Walgreens 2015 Annual Report Download - page 83

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Restructuring costs by segment are as follows (in millions):
Retail Pharmacy Pharmaceutical
Wholesale ConsolidatedUSA International
Fiscal 2015
Asset impairments $216 $ 7 $— $223
Real estate costs 219 — — 219
Severance and other business transition and exit costs 105 12 — 117
Total restructuring costs 540 $ 19 $— $559
Fiscal 2014
Real estate costs $137 $— $— $137
Asset impairments 71 — — 71
Severance and other business transition and exit costs 1 — — 1
Total restructuring costs $209 $— $— $209
5. Leases
Initial terms for leased premises in the U.S. are typically 15 to 25 years, followed by additional terms containing
renewal options at five-year intervals, and may include rent escalation clauses. Non-U.S. leases are typically for
shorter terms and may include cancellation clauses or renewal options. The commencement date of all lease
terms is the earlier of the date the Company becomes legally obligated to make rent payments or the date the
Company has the right to control the property. The Company recognizes rent expense on a straight-line basis
over the term of the lease. In addition to minimum fixed rentals, some leases provide for contingent rentals based
upon a portion of sales.
The Company continuously evaluates its real estate portfolio in conjunction with its capital needs. The Company
has entered into several sale-leaseback transactions. In fiscal 2015, 2014 and 2013, the Company recorded
proceeds from sale-leaseback transactions of $867 million, $67 million and $115 million, respectively. In other
transactions, the Company negotiated fixed rate renewal options which constitute a form of continuing
involvement, resulting in the assets remaining on the balance sheet and a corresponding finance lease obligation.
Annual minimum rental commitments under all leases having an initial or remaining non-cancelable term of
more than one year are shown below (in millions):
Financing
Obligation
Capital
Lease
Operating
Lease
2016 $ 18 $ 69 $ 3,141
2017 18 65 3,008
2018 18 62 2,944
2019 18 60 2,734
2020 18 61 2,518
Later 1,234 881 23,625
Total Minimum Lease Payments $1,324 $1,198 $37,970
The capital and finance lease amounts include $1.6 billion of imputed interest and executory costs. Total
minimum lease payments have not been reduced by minimum sublease rentals of approximately $214 million on
leases due in the future under non-cancelable subleases.
The Company provides for future costs related to closed locations. The liability is based on the present value of
future rent obligations and other related costs (net of estimated sublease rent) to the first lease option date. In
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