Leases (Notes)

3 Months Ended

Mar. 31, 2020

We lease manufacturing facilities, warehouse space, office space, machinery and equipment, information technology equipment and vehicles under operating leases. We also lease one building and machinery and equipment under finance leases. For operating leases with terms greater than 12 months, we record the operating right-of-use asset and related lease liability at the present value of lease payments over the lease term. In certain real estate leases, we have options to renew lease terms, generally at our sole discretion. We evaluate renewal options at the lease commencement date to determine if we are reasonably certain to exercise the option on the basis of economic factors.

The discount rate implicit in our operating leases is generally not determinable, and therefore the Company determines the discount rate for each lease based on its incremental borrowing rate. The incremental borrowing rate is calculated based on lease term, currency and collateral adjustments.

During the three months ended March 31, 2020, the Company obtained right-of-use assets in exchange for new operating lease liabilities of $1.5 million.

Balance Sheet as of March 31, 2020 and December 31, 2019



		March 31, 2020			December 31, 2019
	Classification on the Balance Sheet	(in millions)
Assets
Operating lease assets	Operating lease right-of-use assets	$	60.7		$	64.3
Finance lease assets	Property, plant and equipment, net	28.2			27.1
Total lease assets		$	88.9		$	91.4

Liabilities
Current
Operating	Current portion of operating lease liabilities	$	11.4		$	11.9
Finance	Current portion of long-term debt and short-term debt	6.7			7.0
Noncurrent
Operating	Long-term operating lease liabilities	50.5			53.6
Finance	Long-term debt	11.2			10.2
Total lease liabilities		$	79.8		$	82.7

Weighted-average remaining lease term (in years)
Operating leases		6.9			7.1
Finance leases		4.0			3.9
Weighted-average discount rate
Operating leases		5.3		%	5.4		%
Finance leases		3.9		%	3.7		%

Lease Expense for the three months ended March 31, 2020 and 2019

Operating lease expense is recognized on a straight-line basis over the lease term, with variable payments recognized in the period those payments are incurred.



	Three Months Ended March 31,
	2020		2019
Finance lease expense	(in millions)
Amortization of right-of-use assets	$	1.1	$	1.0
Interest on lease liabilities	0.2		0.2
Operating lease expense	3.9		4.6
Other lease expense⁽¹⁾	1.8		1.0
Total lease expense	$	7.0	$	6.8

(1) - Other lease expense includes variable lease costs and short-term lease costs.

Cash Flow Information



	March 31,
	2020			2019
Cash paid for amounts included in the measurement of lease liabilities	(in millions)
Operating cash flows for operating leases	$	(3.9	)	$	(4.4	)
Operating cash flows for finance leases	$	(0.2	)	$	(0.2	)
Financing cash flows for finance leases	$	0.6		$	(1.6	)

Leases

During the three months ended March 31, 2020, the Company obtained right-of-use assets in exchange for new operating lease liabilities of $1.5 million.

Balance Sheet as of March 31, 2020 and December 31, 2019



		March 31, 2020			December 31, 2019
	Classification on the Balance Sheet	(in millions)
Assets
Operating lease assets	Operating lease right-of-use assets	$	60.7		$	64.3
Finance lease assets	Property, plant and equipment, net	28.2			27.1
Total lease assets		$	88.9		$	91.4

Liabilities
Current
Operating	Current portion of operating lease liabilities	$	11.4		$	11.9
Finance	Current portion of long-term debt and short-term debt	6.7			7.0
Noncurrent
Operating	Long-term operating lease liabilities	50.5			53.6
Finance	Long-term debt	11.2			10.2
Total lease liabilities		$	79.8		$	82.7

Weighted-average remaining lease term (in years)
Operating leases		6.9			7.1
Finance leases		4.0			3.9
Weighted-average discount rate
Operating leases		5.3		%	5.4		%
Finance leases		3.9		%	3.7		%

Lease Expense for the three months ended March 31, 2020 and 2019

Operating lease expense is recognized on a straight-line basis over the lease term, with variable payments recognized in the period those payments are incurred.



	Three Months Ended March 31,
	2020		2019
Finance lease expense	(in millions)
Amortization of right-of-use assets	$	1.1	$	1.0
Interest on lease liabilities	0.2		0.2
Operating lease expense	3.9		4.6
Other lease expense⁽¹⁾	1.8		1.0
Total lease expense	$	7.0	$	6.8

(1) - Other lease expense includes variable lease costs and short-term lease costs.

Cash Flow Information



	March 31,
	2020			2019
Cash paid for amounts included in the measurement of lease liabilities	(in millions)
Operating cash flows for operating leases	$	(3.9	)	$	(4.4	)
Operating cash flows for finance leases	$	(0.2	)	$	(0.2	)
Financing cash flows for finance leases	$	0.6		$	(1.6	)