Leased Assets and Liabilities

6 Months Ended

Jun. 30, 2019

We lease real estate and equipment under operating and finance lease agreements. Our leases have terms of up to 15 years, some of which may include the option to extend the lease for up to 5 years. At lease commencement, we record a lease liability and corresponding right-of-use asset. Lease liabilities represent the present value of our future lease payments over the expected lease term, which includes options to extend or terminate the lease when it is reasonably certain those options will be exercised. Lease payments include fixed payments and variable payments that are tied to an index. Variable payments not tied to an index are excluded from the right-of-use asset and lease liability and primarily include common area maintenance charges, property taxes, insurance and mileage. The present value of our lease liability is determined using our incremental borrowing rate at lease inception. Information regarding our operating and financing leases are as follows:



Leases	Balance Sheet Location	June 30, 2019		December 31, 2018
Assets
Operating	Operating lease assets	$	180,983	$	156,788
Finance	Property, plant and equipment, net	11,501		10,683
Total leased assets		$	192,484	$	167,471

Liabilities
Operating	Current operating lease liabilities	$	34,612	$	37,208
	Noncurrent operating lease liabilities	154,648		127,237
Finance	Accounts payable and accrued liabilities	2,809		2,708
	Other noncurrent liabilities	7,739		7,054
Total lease liabilities		$	199,808	$	174,207



	Three Months Ended June 30,						Six Months Ended June 30,
Lease Cost	2019			2018			2019			2018
Operating lease expense	$	11,695		$	11,145		$	23,786		$	23,422
Finance lease expense
Amortization of leased assets	811			640			1,691			1,242
Interest on lease liabilities	176			125			348			243
Variable lease expense	7,988			7,952			13,852			13,094
Sublease income	(679		)	(203		)	(1,345		)	(452		)
Total expense	$	19,991		$	19,659		$	38,332		$	37,549

Operating lease expense includes immaterial amounts related to leases with terms of 12 months or less.



Future Lease Payments	Operating Leases		Finance Leases		Total
Remaining for year ending December 31, 2019	$	22,257	$	1,803	$	24,060
Year ending December 31, 2020	42,878		3,105		45,983
Year ending December 31, 2021	35,937		2,712		38,649
Year ending December 31, 2022	27,637		2,162		29,799
Year ending December 31, 2023	21,032		1,518		22,550
Thereafter	89,177		813		89,990
Total	238,918		12,113		251,031
Less: present value discount	49,658		1,565		51,223
Lease liability	$	189,260	$	10,548	$	199,808

Operating leases exclude $28 million of minimum lease payments for leases signed but not yet commenced at June 30, 2019.



Lease Term and Discount Rate	June 30, 2019	December 31, 2018
Weighted-average remaining lease term
Operating leases	7.5 years	5.9 years
Finance leases	4.1 years	3.8 years
Weighted-average discount rate
Operating leases	5.8%	4.7%
Finance leases	6.6%	6.2%



	Three Months Ended June 30,				Six Months Ended June 30,
Cash Flow Information	2019		2018		2019		2018
Operating cash outflows - operating leases	$	11,073	$	10,987	$	22,870	$	22,738
Operating cash outflows - finance leases	$	176	$	125	$	348	$	243
Financing cash outflows - finance leases	$	775	$	592	$	1,520	$	1,156

Leased assets obtained in exchange for new lease obligations
Operating leases	$	40,907	$	3,998	$	49,060	$	6,994
Finance leases	$	430	$	88	$	2,103	$	1,160

Leased Assets and Liabilities



Leases	Balance Sheet Location	June 30, 2019		December 31, 2018
Assets
Operating	Operating lease assets	$	180,983	$	156,788
Finance	Property, plant and equipment, net	11,501		10,683
Total leased assets		$	192,484	$	167,471

Liabilities
Operating	Current operating lease liabilities	$	34,612	$	37,208
	Noncurrent operating lease liabilities	154,648		127,237
Finance	Accounts payable and accrued liabilities	2,809		2,708
	Other noncurrent liabilities	7,739		7,054
Total lease liabilities		$	199,808	$	174,207



	Three Months Ended June 30,						Six Months Ended June 30,
Lease Cost	2019			2018			2019			2018
Operating lease expense	$	11,695		$	11,145		$	23,786		$	23,422
Finance lease expense
Amortization of leased assets	811			640			1,691			1,242
Interest on lease liabilities	176			125			348			243
Variable lease expense	7,988			7,952			13,852			13,094
Sublease income	(679		)	(203		)	(1,345		)	(452		)
Total expense	$	19,991		$	19,659		$	38,332		$	37,549

Operating lease expense includes immaterial amounts related to leases with terms of 12 months or less.



Future Lease Payments	Operating Leases		Finance Leases		Total
Remaining for year ending December 31, 2019	$	22,257	$	1,803	$	24,060
Year ending December 31, 2020	42,878		3,105		45,983
Year ending December 31, 2021	35,937		2,712		38,649
Year ending December 31, 2022	27,637		2,162		29,799
Year ending December 31, 2023	21,032		1,518		22,550
Thereafter	89,177		813		89,990
Total	238,918		12,113		251,031
Less: present value discount	49,658		1,565		51,223
Lease liability	$	189,260	$	10,548	$	199,808

Operating leases exclude $28 million of minimum lease payments for leases signed but not yet commenced at June 30, 2019.



Lease Term and Discount Rate	June 30, 2019	December 31, 2018
Weighted-average remaining lease term
Operating leases	7.5 years	5.9 years
Finance leases	4.1 years	3.8 years
Weighted-average discount rate
Operating leases	5.8%	4.7%
Finance leases	6.6%	6.2%



	Three Months Ended June 30,				Six Months Ended June 30,
Cash Flow Information	2019		2018		2019		2018
Operating cash outflows - operating leases	$	11,073	$	10,987	$	22,870	$	22,738
Operating cash outflows - finance leases	$	176	$	125	$	348	$	243
Financing cash outflows - finance leases	$	775	$	592	$	1,520	$	1,156

Leased assets obtained in exchange for new lease obligations
Operating leases	$	40,907	$	3,998	$	49,060	$	6,994
Finance leases	$	430	$	88	$	2,103	$	1,160