Quarterly report pursuant to Section 13 or 15(d)

Leases

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Leases
3 Months Ended
Dec. 31, 2019
Leases [Abstract]  
Leases
Leases

The Company’s lease portfolio is comprised of operating leases primarily for manufacturing facilities, offices, vehicles, and certain equipment. At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on whether the contract conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. Leases are classified as operating or finance leases at the commencement date of the lease. Operating leases are recorded within operating lease right-of-use assets, other current liabilities, and operating lease liabilities in the Consolidated Balance Sheets. The Company’s finance leases were insignificant as of December 31, 2019. Leases with an initial term of 12 months or less are not recorded on the Consolidated Balance Sheets. We have elected an accounting policy to combine lease and non-lease components for all leases.

Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the implicit rate is generally not readily determinable for most leases, the Company uses an incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate reflects the estimated rate of interest that the Company would pay to borrow on a collateralized basis over a similar term in a similar economic environment. Lease expense for operating leases is recognized on a straight-line basis over the lease term.

Leases may include renewal options, and the renewal option is included in the lease term if the Company concludes that it is reasonably certain that the option will be exercised. A certain number of the Company’s leases contain rent escalation clauses, either fixed or adjusted periodically for inflation of market rates, that are factored into the calculation of lease payments to the extent they are fixed and determinable at lease inception. The Company also has variable lease payments that do not depend on a rate or index, primarily for items such as common area maintenance and real estate taxes, which are recorded as variable costs when incurred.

For the three months ended December 31, 2019, the Company recognized $8.0 of operating lease expense, including short-term lease expense and variable lease costs, which were immaterial in the quarter.

The following table presents supplemental Consolidated Balance Sheet information related to the Company’s operating leases.
 
December 31, 2019
Operating lease right-of-use assets
$
172.5

 
 
Other current liabilities
$
32.9

Operating lease liabilities
137.1

Total operating lease liabilities
$
170.0

 
 
Weighted-average remaining lease term (in years)
7.9

 
 
Weighted-average discount rate
2.2
%


As of December 31, 2019, the maturities of the Company’s operating lease liabilities were as follows:
2020 (excluding the three months ended December 31, 2019)
$
27.4

2021
32.8

2022
28.0

2023
22.8

2024
15.4

Thereafter
57.8

Total lease payments
184.2

Less: imputed interest
(14.2
)
Total present value of lease payments
$
170.0



Supplemental Consolidated Statement of Cash Flow information is as follows:
 
Three Months Ended December 31, 2019
Cash paid for amounts included in the measurement of operating lease liabilities
$
8.0

Operating lease right-of-use assets obtained in exchange for new operating lease liabilities
13.3