LEASES

12 Months Ended

Jun. 30, 2020

Leases [Abstract]

LEASES

LEASES

The Company leases office space, warehouse and distribution facilities, manufacturing equipment and vehicles primarily in North America and Europe. The Company determines if an arrangement is or contains a lease at inception. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company’s lease agreements generally do not contain residual value guarantees or material restrictive covenants. A limited number of lease agreements include rental payments adjusted periodically for inflation.

Certain of the Company’s leases contain variable lease payments, which are expensed as incurred unless those payments are based on an index or rate. Variable lease payments based on an index or rate are initially measured using the index or rate in effect at lease commencement and included in the measurement of the lease liability; thereafter, changes to lease payments due to rate or index changes are recorded as variable lease expense in the period incurred. The Company does not have any related party leases, and sublease transactions are de minimis.

The components of lease expenses for the fiscal year ended June 30, 2020 were as follows:

	Fiscal Year Ended
	June 30, 2020
Operating lease expenses (a)	$	18,981
Finance lease expenses (a)	1,197
Variable lease expenses	2,570
Short-term lease expenses	1,723
Total lease expenses	$	24,471

^(a) Operating lease expenses and finance lease expenses include $1,505 and $251 of ROU asset impairment charges, respectively, associated with the Company’s ongoing productivity and transformation costs initiatives. Of this amount, $929 was recognized as a component of Long-lived asset and intangibles impairment on the Consolidated Statement of Operations with the remainder recognized as a component of Cost of Sales.

Supplemental balance sheet information related to leases was as follows:

Leases	Classification	June 30, 2020
Assets
Operating lease ROU assets	Operating lease right-of-use assets	$	88,165
Finance lease ROU assets, net	Property, plant and equipment, net	691
Total leased assets		$	88,856
Liabilities
Current
Operating	Accrued expenses and other current liabilities	$	12,338
Finance	Current portion of long-term debt	308
Non-current
Operating	Operating lease liabilities, noncurrent portion	82,962
Finance	Long-term debt, less current portion	316
Total lease liabilities		$	95,924

Additional information related to leases is as follows:

	Fiscal Year Ended
	June 30, 2020
Supplemental cash flow information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	17,290
Operating cash flows from finance leases	$	26
Financing cash flows from finance leases	$	543
ROU assets obtained in exchange for lease obligations (b):
Operating leases	$	104,915
Finance leases	$	1,475
Weighted average remaining lease term:
Operating leases	10.0 years
Finance leases	2.5 years
Weighted average discount rate:
Operating leases	3.0		%
Finance leases	2.3		%

^(b) ROU assets obtained in exchange for lease obligations includes the impact of the adoption of ASU 2016-02 effective July 1, 2019 (see Note 2) and leases which commenced, were modified or terminated during the fiscal year ended June 30, 2020.

Maturities of lease liabilities as of June 30, 2020 were as follows:

Fiscal Year	Operating leases		Finance leases		Total
2021	$	14,781	$	308	$	15,089
2022	13,798		205		14,003
2023	12,833		95		12,928
2024	10,941		18		10,959
2025	9,521		6		9,527
Thereafter	51,545		—		51,545
Total lease payments	113,419		632		114,051
Less: Imputed interest	18,119		8		18,127
Total lease liabilities	$	95,300	$	624	$	95,924

The aggregate minimum future lease payments for operating leases at June 30, 2019, adjusted for discontinued operations, were as follows:

Fiscal Year
2020	$	19,066
2021	16,281
2022	14,002
2023	13,134
2024	11,012
Thereafter	44,452
	$	117,947

At June 30, 2020, the Company has additional operating leases that had not yet commenced. Obligations under these leases are approximately $9,797 and the leases are expected to commence during the fiscal year ending June 30, 2021 with lease terms ranging from 10 to 11 years, excluding renewal options.

LEASES

LEASES

The Company leases office space, warehouse and distribution facilities, manufacturing equipment and vehicles primarily in North America and Europe. The Company determines if an arrangement is or contains a lease at inception. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company’s lease agreements generally do not contain residual value guarantees or material restrictive covenants. A limited number of lease agreements include rental payments adjusted periodically for inflation.

Certain of the Company’s leases contain variable lease payments, which are expensed as incurred unless those payments are based on an index or rate. Variable lease payments based on an index or rate are initially measured using the index or rate in effect at lease commencement and included in the measurement of the lease liability; thereafter, changes to lease payments due to rate or index changes are recorded as variable lease expense in the period incurred. The Company does not have any related party leases, and sublease transactions are de minimis.

The components of lease expenses for the fiscal year ended June 30, 2020 were as follows:

	Fiscal Year Ended
	June 30, 2020
Operating lease expenses (a)	$	18,981
Finance lease expenses (a)	1,197
Variable lease expenses	2,570
Short-term lease expenses	1,723
Total lease expenses	$	24,471

^(a) Operating lease expenses and finance lease expenses include $1,505 and $251 of ROU asset impairment charges, respectively, associated with the Company’s ongoing productivity and transformation costs initiatives. Of this amount, $929 was recognized as a component of Long-lived asset and intangibles impairment on the Consolidated Statement of Operations with the remainder recognized as a component of Cost of Sales.

Supplemental balance sheet information related to leases was as follows:

Leases	Classification	June 30, 2020
Assets
Operating lease ROU assets	Operating lease right-of-use assets	$	88,165
Finance lease ROU assets, net	Property, plant and equipment, net	691
Total leased assets		$	88,856
Liabilities
Current
Operating	Accrued expenses and other current liabilities	$	12,338
Finance	Current portion of long-term debt	308
Non-current
Operating	Operating lease liabilities, noncurrent portion	82,962
Finance	Long-term debt, less current portion	316
Total lease liabilities		$	95,924

Additional information related to leases is as follows:

	Fiscal Year Ended
	June 30, 2020
Supplemental cash flow information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	17,290
Operating cash flows from finance leases	$	26
Financing cash flows from finance leases	$	543
ROU assets obtained in exchange for lease obligations (b):
Operating leases	$	104,915
Finance leases	$	1,475
Weighted average remaining lease term:
Operating leases	10.0 years
Finance leases	2.5 years
Weighted average discount rate:
Operating leases	3.0		%
Finance leases	2.3		%

^(b) ROU assets obtained in exchange for lease obligations includes the impact of the adoption of ASU 2016-02 effective July 1, 2019 (see Note 2) and leases which commenced, were modified or terminated during the fiscal year ended June 30, 2020.

Maturities of lease liabilities as of June 30, 2020 were as follows:

Fiscal Year	Operating leases		Finance leases		Total
2021	$	14,781	$	308	$	15,089
2022	13,798		205		14,003
2023	12,833		95		12,928
2024	10,941		18		10,959
2025	9,521		6		9,527
Thereafter	51,545		—		51,545
Total lease payments	113,419		632		114,051
Less: Imputed interest	18,119		8		18,127
Total lease liabilities	$	95,300	$	624	$	95,924

The aggregate minimum future lease payments for operating leases at June 30, 2019, adjusted for discontinued operations, were as follows:

Fiscal Year
2020	$	19,066
2021	16,281
2022	14,002
2023	13,134
2024	11,012
Thereafter	44,452
	$	117,947

At June 30, 2020, the Company has additional operating leases that had not yet commenced. Obligations under these leases are approximately $9,797 and the leases are expected to commence during the fiscal year ending June 30, 2021 with lease terms ranging from 10 to 11 years, excluding renewal options.