Medtronic 2016 Annual Report Download - page 120
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Table of Contents
Medtronic plc
Notes to Consolidated Financial Statements (Continued)
117
Effective January 1, 2016, the Company froze participation in the existing defined benefit (PPA) and contribution (PIA) pension
plans in the U.S. and implemented a new form of benefit under the existing defined contribution plan for legacy Covidien employees
and employees in the U.S. hired on or after January 1, 2016. Participants in the Medtronic Core Contribution (MCC) also receive
an annual allocation of their salary and bonus and are allowed to determine how to invest their funds among identified fund
alternatives. The cost associated with the MCC is included in U.S. Pension Benefits in the tables presented earlier. The defined
contribution cost associated with the MCC was approximately $12 million in fiscal year 2016.
13. Leases
The Company leases office, manufacturing, and research facilities and warehouses, as well as transportation, data processing, and
other equipment under capital and operating leases. A substantial number of these leases contain options that allow the Company
to renew at the fair rental value on the date of renewal.
Future minimum payments under capitalized leases and non-cancelable operating leases at April 29, 2016 are:
(in millions)
Fiscal Year Capitalized
Leases Operating
Leases
2017 $ 109 $ 180
2018 5 130
2019 4 90
2020 4 56
2021 3 33
Thereafter 16 55
Total minimum lease payments $ 141 $ 544
Less amounts representing interest (9) N/A
Present value of net minimum lease payments $ 132 N/A
Rent expense for all operating leases was $269 million, $195 million, and $150 million in fiscal years 2016, 2015, and 2014,
respectively. The increase in fiscal year 2016 rent expense is primarily related to the Covidien acquisition.