LEASES (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of operating and finance ROU assets and lease liabilities


(In millions)	Balance Sheet Classification	December 31, 2019
Assets
Operating lease right-of-use assets (1)	Operating lease right-of-use assets	$	4,796.0
Finance lease right-of-use assets (2)	Property, net		73.4
Total leased assets		$	4,869.4

Liabilities
Current
Operating lease liabilities (1)	Current maturities of operating lease liabilities	$	585.8
Finance lease liabilities (2)	Current maturities of finance lease liabilities		10.3
Noncurrent
Operating lease liabilities (1)	Operating lease liabilities		4,913.8
Finance lease liabilities (2)	Finance lease liabilities		89.6
Total lease liabilities		$	5,599.5

(1)Included in the operating lease right-of-use assets and operating lease liabilities are assets and liabilities for leases related to previous build-to-suit failed sale leaseback transactions, that were derecognized and recorded as a cumulative effect adjustment to accumulated deficit upon adoption of ASC 842. These leases were classified and remeasured at January 1, 2019 as operating right-of-use assets and operating lease liabilities.

(2)Corresponding with the adoption of ASC 842, the Company renamed previously classified capital lease assets and capital lease obligations under ASC 840 as finance lease right-of-use assets and finance lease liabilities, respectively. The Company recognized the finance lease right-of-use assets and finance lease liabilities on January 1, 2019 at the carrying amount of the capital lease asset and capital lease obligation as of December 31, 2018.

Schedule of cumulative effect adjustment to accumulated deficit


	Accumulated
(In millions)	Deficit
Balance as of December 31, 2018	$	(550.9)
Derecognition of existing assets for certain sale leaseback transactions previously recorded in property, net		(405.9)
Derecognition of existing liabilities for certain sale leaseback transactions previously recorded in current maturities of capital and financing lease obligations and in finance lease liabilities		427.5
Derecognition of deferred gains from the sale leaseback transactions previously recorded in other long-term liabilities		102.4
Difference in fair value compared to the basis of the right-of-use assets for previously impaired asset groups		(49.0)
Deferred taxes		1.2
Cumulative effect adjustment to accumulated deficit		76.2
Balance as of January 1, 2019	$	(474.7)

Schedule of lease impact on the income statement


	Year Ended December 31, 2019
	Without Adoption of		U.S. Markets		International Markets
(In millions)	ASC 842		Adjustments		Adjustments		As Reported
Operating costs and expenses
Rent (1)(2)(4)	$	851.3	$	69.5	$	47.0	$	967.8
Depreciation and amortization (2)(3)		546.0		(53.6)		(42.4)		450.0
Operating costs and expenses		5,314.5		15.9		4.6		5,335.0
Operating income		156.5		(15.9)		(4.6)		136.0

Other expense (income)
Interest expense:
Capital and financing lease obligations (1)		35.2		(13.2)		(14.4)		7.6
Net loss		(156.2)		(2.7)		9.8		(149.1)

(1)Cash rent payments for build-to-suit failed sale leasebacks of $44.0 million and $39.6 million for U.S. Markets and International markets, respectively, are accounted for as operating leases under ASC 842 that were previously accounted for as financing leases under ASC 840.

(2)Non-cash amortization expense for favorable lease terms of $18.3 million and $7.4 million for U.S. Markets and International markets, respectively, reclassified to rent expense and amortized over the shorter base lease term under ASC 842.

(3)Depreciation on build-to-suit failed sale leaseback buildings that are eliminated upon adoption of ASC 842.

(4)Amortization of deferred gains on sale leaseback transactions of $7.2 million for U.S. markets is eliminated upon adoption of ASC 842.

Schedule of components of lease costs


		Year Ended
(In millions)	Consolidated Statement of Operations	December 31, 2019
Operating lease cost
Theatre properties	Rent	$	876.0
Theatre properties	Operating expense		9.1
Equipment	Operating expense		14.4
Office and other	General and administrative: other		5.5
Finance lease cost
Amortization of finance lease assets	Depreciation and amortization		9.2
Interest expense on lease liabilities	Finance lease obligations		7.6
Variable lease cost
Theatre properties	Rent		91.8
Equipment	Operating expense		56.3
Total lease cost		$	1,069.9

Schedule of weighted average remaining lease term and discount rate


	As of December 31, 2019
	Weighted Average		Weighted Average
	Remaining		Discount
Lease Term and Discount Rate	Lease Term (years)		Rate
Operating leases		10.2		7.2%
Finance leases		13.0		6.5%

Schedule of cash flow and supplemental information


	Year Ended
(In millions)	December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used in finance leases	$	(7.6)
Operating cash flows used in operating leases		(941.6)
Financing cash flows used in finance leases		(10.9)

Landlord contributions:
Operating cashflows provided by operating leases		106.5
Supplemental disclosure of noncash leasing activities:
Right-of-use assets obtained in exchange for new operating lease liabilities (1)		463.2

(1)

Includes lease extensions and an option exercise.

Schedule of minimum annual payments required under existing leases


	Operating Lease		Financing Lease
(In millions)	Payments (1)(2)		Payments
2020	$	952.5	$	16.4
2021		899.1		15.4
2022		836.1		14.9
2023		743.6		11.8
2024		667.2		10.6
Thereafter		3,738.4		80.5
Total lease payments		7,836.9		149.6
Less imputed interest		(2,337.3)		(49.7)
Total	$	5,499.6	$	99.9

(1)Included in this column upon adoption of ASC 842 are liabilities for leases that were previously classified as build-to-suit failed sale leaseback transactions that were included in the capital and finance lease obligations columns in the prior year.

(2)Included in this column upon adoption of ASC 842 are fixed executory costs that were previously excluded as part of the minimum lease payments. Fixed executory costs, which primarily consist of common area maintenance, insurance and taxes that meet the classification of fixed payments are included as part of the minimum lease payments.