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Leases

12 Months Ended

Dec. 31, 2022

The Company has operating and finance leases for service centers, warehouses, showrooms, and machinery and equipment. Certain of the Company’s leases include rental payments that will adjust periodically for inflation or certain adjustments based on step increases. An insignificant number of the Company’s leases contain residual value guarantees and none of the Company’s agreements contain material restrictive covenants.

The Company rents or subleases certain real estate to third parties. The Company’s sublease portfolio consists mainly of operating leases.

The components of lease costs for the twelve months ended December 31, 2022, 2021 and 2020, respectively, are as follows:


December 31, 2022	Cost of Goods Sold		Selling, General and Administrative Expenses	Total
Operating lease costs
Fixed	$	21,321	110,716	132,037
Short-term	17,005		19,154	36,159
Variable	7,689		35,985	43,674
Sub-leases	(691)		(1,652)	(2,343)
	$	45,324	164,203	209,527

	Depreciation and Amortization		Interest	Total
Finance lease costs
Amortization of leased assets	$	11,108	—	11,108
Interest on lease liabilities	—		816	816
	$	11,108	816	11,924
Net lease costs				$	221,451


December 31, 2021	Cost of Goods Sold		Selling, General and Administrative Expenses	Total
Operating lease costs
Fixed	$	20,130	104,651	124,781
Short-term	13,415		18,434	31,849
Variable	7,949		30,127	38,076
Sub-leases	(529)		(1,113)	(1,642)
	$	40,965	152,099	193,064

	Depreciation and Amortization		Interest	Total
Finance lease costs
Amortization of leased assets	$	9,193	—	9,193
Interest on lease liabilities	—		772	772
	$	9,193	772	9,965
Net lease costs				$	203,029


December 31, 2020	Cost of Goods Sold		Selling, General and Administrative Expenses	Total
Operating lease costs
Fixed	$	25,067	102,504	127,571
Short-term	11,633		16,021	27,654
Variable	8,285		30,036	38,321
Sub-leases	(411)		(741)	(1,152)
	$	44,574	147,820	192,394

	Depreciation and Amortization		Interest	Total
Finance lease costs
Amortization of leased assets	$	6,423	—	6,423
Interest on lease liabilities	—		690	690
	$	6,423	690	7,113
Net lease costs				$	199,507

Supplemental balance sheet information related to leases is as follows:


	Classification	December 31, 2022		December 31, 2021
Assets
Operating Leases
ROU operating lease assets	ROU operating lease assets	$	387,816	389,967
Finance Leases
Property, plant and equipment, gross	Property, plant and equipment	82,653		67,984
Accumulated depreciation	Accumulated depreciation	(30,218)		(19,902)
Property, plant and equipment, net	Property, plant and equipment, net	52,435		48,082
Total lease assets		$	440,251	438,049

Liabilities
Operating Leases
Other current	Current operating lease liabilities	$	105,266	104,434
Non-current	Non-current operating lease liabilities	296,136		297,390
Total operating liabilities		401,402		401,824
Finance Leases
Short-term debt	Short-term debt and current portion of long-term debt	11,765		9,560
Long-term debt	Long-term debt, less current portion	40,285		38,390
Total finance liabilities		52,050		47,950
Total lease liabilities		$	453,452	449,774

Maturities of lease liabilities as of December 31, 2022 are as follows:


Year ending December 31,	Finance Leases		Operating Leases	Total
2023	$	12,574	125,068	137,642
2024	10,939		103,229	114,168
2025	9,498		82,839	92,337
2026	7,344		61,815	69,159
2027	4,433		34,829	39,262
Thereafter	10,509		27,414	37,923
Total lease payments	55,297		435,194	490,491
Less imputed interest	3,247		33,792
Present value, Total	$	52,050	401,402

The Company had approximately $6,516 of leases that commenced after December 31, 2022 that created rights and obligations to the Company. These leases are not included in the above maturity schedule.

Lease term and discount rate are as follows:


	December 31, 2022		December 31, 2021
Weighted Average Remaining Lease Term
Operating Leases	4.5 years		4.7 years
Finance Leases	6.2 years		7.2 years

Weighted Average Discount Rate
Operating Leases	3.8	%	2.4	%
Finance Leases	1.5	%	1.3	%

Supplemental cash flow information related to leases was as follows:


	Twelve Months Ended
	December 31, 2022		December 31, 2021	December 31, 2020
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows from operating leases	$	129,895	122,886	124,708
Operating cash flows from finance leases	816		772	690
Financing cash flows from finance leases	10,770		9,289	6,386
ROU assets obtained in exchange for lease obligations:
Operating leases	119,115		186,605	110,036
Finance leases	16,160		13,395	18,248
Amortization:
Amortization of ROU operating lease assets (1)	120,666		115,650	113,898

(1) Amortization of ROU operating lease assets during the period is reflected in Other assets and prepaid expenses on the Consolidated Statements of Cash Flows.

Leases