TopBuild Corp. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Leases

Six Months Ended June 30,

Cash paid for amounts included in the measurement of lease liabilities

Leases

6 Months Ended

Jun. 30, 2021

8. LEASES

We have operating leases for our installation branch locations, distribution centers, our Branch Support Center in Daytona Beach, Florida, vehicles and certain equipment. In addition, we lease certain operating facilities from related parties, primarily former owners (and in certain cases, current management personnel) of companies acquired. These related party leases are immaterial to our consolidated statements of operations. As of June 30, 2021, we did not have any finance leases.

The components of lease expense were as follows and are primarily included in cost of sales on the accompanying unaudited condensed consolidated statements of operations, in thousands:


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Operating lease cost (a)	$	12,636	$	12,096	$	24,446	$	24,367
Short-term lease cost		3,844		2,813		7,198		5,877
Sublease income		(215)		(49)		(421)		(111)
Net lease cost	$	16,265	$	14,860	$	31,223	$	30,133

(a)	Includes variable cost components of $1,808 and $1,330 in the three months ended June 30, 2021 and 2020, respectively, and $3,505 and $2,774 of variable cost components in the six months ended June 30, 2021 and 2020, respectively.

Future minimum lease payments under non-cancellable operating leases as of June 30, 2021 were as follows, in thousands:


Payments due by Period
2021	$	21,141
2022		34,701
2023		23,826
2024		16,212
2025		11,147
2026 & Thereafter		7,791
Total future minimum lease payments		114,818

Less: imputed interest		(9,688)

Lease liability at June 30, 2021	$	105,130

As of June 30, 2021, the weighted average remaining lease term was 3.7 years and the related lease liability was calculated using a weighted average discount rate of 3.4%.

The amount below is included in the cash flows provided by (used in) operating activities section on the accompanying unaudited condensed consolidated statements of cash flows, in thousands: