Ulta Beauty, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Leases

Leases

9 Months Ended

Oct. 30, 2021

6.Leases

The Company leases retail stores, distribution centers, fast fulfillment centers, corporate offices, and certain equipment under non-cancelable operating leases with various expiration dates through 2033. All leases are classified as operating leases and generally have initial lease terms of 10 years and, when determined applicable, include renewal options under substantially the same terms and conditions as the original leases. Leases do not contain any material residual value guarantees or material restrictive covenants.

Lease cost

The majority of operating lease cost relates to retail stores, distribution centers, and fast fulfillment centers and is classified within cost of sales. Operating lease cost for corporate offices is classified within selling, general and administrative expenses. Operating lease cost from the control date through store opening date is classified within pre-opening expenses.

The following table presents a summary of operating lease costs for the 13 and 39 weeks ended October 30, 2021 and October 31, 2020:


	13 weeks ended				39 weeks ended
	October 30,		October 31,		October 30,		October 31,
(In thousands)	2021		2020		2021		2020
Operating lease cost	$	77,976	$	75,649	$	233,488	$	228,881

Other information

The following table presents supplemental disclosures of cash flow information related to operating leases:


	39 Weeks Ended
	October 30,		October 31,
(In thousands)	2021		2020
Cash paid for operating lease liabilities (1)	$	275,016	$	263,893
Operating lease assets obtained in exchange for operating lease liabilities (non-cash)		165,936		188,240

(1)	Excludes $24,570 and $22,789 related to cash received for tenant incentives for the 39 weeks ended October 30, 2021 and October 31, 2020, respectively.