Leases

9 Months Ended

Sep. 30, 2023

The Company has operating and finance leases for office and warehouse facilities, headquarters, call centers, machinery and certain computer and communications equipment which provide the right to use the underlying assets in exchange for agreed upon lease payments, determined by the payment schedule contained in each lease. The Company’s lease portfolio consists primarily of operating leases which expire at various dates through 2032. In the third quarter of 2023, the Company recorded a right-of-use ("ROU") asset and related lease liability of approximately $0.2 million related to equipment acquired under a finance lease for a five year term. In the second quarter of 2023, the Company recorded a ROU asset and related lease liability of approximately $5.1 million related to an extension of an existing warehouse facility in the U.S. consisting of approximately 317,000 square feet. The lease extension is for a three year term unless terminated earlier as provided in the lease.

In addition, as part of the Indoff acquisition, ROU assets and related lease liabilities of $0.8 million were recorded. These operating leases include two administrative office locations and one distribution center which expire at various dates through 2027. These properties aggregate to approximately 31,800 square feet of space.

The Company's operating lease costs, included in continuing operations, was $4.3 million for the three months ended September 30, 2023 and 2022, and $12.7 million and $11.2 million for the nine months ended September 30, 2023 and 2022, respectively. The Company recorded sublease income of $0.6 million and $1.8 million for the three and nine months ended September 30, 2023, respectively, and recorded $0.4 million and $0.5 million for the three and nine months ended September 30, 2022, respectively.

Information relating to operating and finance leases for continuing and discontinued operations as of September 30, 2023 and December 31, 2022:


	Nine Months Ended September 30,			Year Ended December 31,
	2023			2022
Weighted Average Remaining Lease Term
Operating and finance leases	7.4 years			8.2 years

Weighted Average Discount Rate
Operating and finance leases	5.4		%	5.4		%

ROU assets obtained in exchange for operating and finance lease obligations (in millions)	$	6.1		$	34.5

Maturities of lease liabilities were as follows (in millions):


Year Ending December 31	Operating Leases
2023 (adjusted for nine months of payments)	$	4.7
2024	18.9
2025	17.7
2026	15.5
2027	11.8
2028	11.9
Thereafter	40.6
Total lease payments	121.1
Less: interest	(23.1)
Total present value of lease liabilities	$	98.0