| Leases |
5. Leases
As of June 30, 2023, the Company leased 1,278 of the convenience stores that it operates, 209 dealer locations, 157 cardlock locations and certain office and storage spaces, including land and buildings in certain cases. Most of the lease agreements are for
long-term periods, ranging from 15 to 20 years, and generally include several renewal options for extension periods for five to 25 years each. Additionally, the Company leases certain store equipment, office equipment, automatic tank gauges and fuel dispensers.
The components of lease cost recorded on the condensed consolidated statements of operations were as follows:
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For the Three Months
Ended June 30, |
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|
For the Six Months
Ended June 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
|
(in thousands) |
|
Finance lease cost: |
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|
|
|
|
|
|
|
|
|
|
|
Depreciation of right-of-use assets |
|
$ |
2,785 |
|
|
$ |
3,037 |
|
|
$ |
5,638 |
|
|
$ |
6,084 |
|
Interest on lease liabilities |
|
|
4,142 |
|
|
|
4,260 |
|
|
|
8,304 |
|
|
|
8,631 |
|
Operating lease costs included in store operating expenses |
|
|
45,752 |
|
|
|
34,358 |
|
|
|
87,336 |
|
|
|
68,653 |
|
Operating lease costs included in general and administrative
expenses |
|
|
587 |
|
|
|
351 |
|
|
|
1,121 |
|
|
|
738 |
|
Lease cost related to variable lease payments, short-term
leases and leases of low value assets |
|
|
711 |
|
|
|
569 |
|
|
|
1,401 |
|
|
|
1,213 |
|
Right-of-use asset impairment charges and loss (gain) on
disposals of leases |
|
|
1,994 |
|
|
|
— |
|
|
|
1,454 |
|
|
|
— |
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Total lease costs |
|
$ |
55,971 |
|
|
$ |
42,575 |
|
|
$ |
105,254 |
|
|
$ |
85,319 |
|
Supplemental balance sheet date related to leases was as follows:
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June 30,
2023 |
|
|
December 31,
2022 |
|
|
|
(in thousands) |
|
Operating leases |
|
|
|
|
|
|
Weighted average remaining lease term (in years) |
|
|
14.4 |
|
|
|
14.1 |
|
Weighted average discount rate |
|
|
7.8 |
% |
|
|
7.7 |
% |
Financing leases |
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|
|
|
|
|
Weighted average remaining lease term (in years) |
|
|
23.1 |
|
|
|
23.4 |
|
Weighted average discount rate |
|
|
7.2 |
% |
|
|
7.2 |
% |
As of June 30, 2023, maturities of lease liabilities for operating lease obligations and financing lease obligations having an initial or remaining non-cancellable lease terms in excess of one year were presented in the table below. The minimum lease payments presented below include periods where an option is reasonably certain to be exercised and do not take into consideration any future consumer price index adjustments for these agreements.
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Operating |
|
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Financing |
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|
|
(in thousands) |
|
July 2023 through June 2024 |
|
$ |
174,609 |
|
|
$ |
21,279 |
|
July 2024 through June 2025 |
|
|
176,244 |
|
|
|
21,046 |
|
July 2025 through June 2026 |
|
|
176,841 |
|
|
|
20,914 |
|
July 2026 through June 2027 |
|
|
174,535 |
|
|
|
20,772 |
|
July 2027 through June 2028 |
|
|
171,421 |
|
|
|
20,860 |
|
Thereafter |
|
|
1,688,912 |
|
|
|
414,378 |
|
Gross lease payments |
|
$ |
2,562,562 |
|
|
$ |
519,249 |
|
Less: imputed interest |
|
|
(1,076,015 |
) |
|
|
(290,462 |
) |
Total lease liabilities |
|
$ |
1,486,547 |
|
|
$ |
228,787 |
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|