LEASES LEASES (Notes)

9 Months Ended

Dec. 31, 2019

Leases

The Company leases office space, manufacturing facilities, land, vehicles, and equipment. The Company determines if an agreement is or contains a lease at the lease inception date and recognizes right-of-use assets and lease liabilities at the lease commencement date. A ROU asset and corresponding lease liability are not recorded for leases with an initial term of 12 months or less (short-term leases).

ROU assets represent the Company's right to use an underlying asset during the lease term, and lease liabilities represent the Company's obligation to make lease payments arising from the lease. The determination of the length of lease terms is affected by options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The existence of significant economic incentive is the primary consideration when assessing whether the Company is reasonably certain of exercising an option in a lease. Both finance and operating lease ROU assets and liabilities are recognized at commencement date and measured as the present value of lease payments to be made over the lease term. As the interest rate implicit in the lease is not readily available for most of the Company's leases, the Company uses its estimated incremental borrowing rate in determining the present value of lease payments. The estimated incremental borrowing rate is derived from information available at the lease commencement date. The lease ROU asset recognized at commencement is adjusted for any lease payments related to initial direct costs, prepayments, and lease incentives.

For operating leases, lease expense is recognized on a straight-line basis over the lease term. For finance leases, lease expense comprises the amortization of the ROU assets recognized on a straight-line basis generally over the shorter of the lease term or the estimated useful life of the underlying asset and interest on the lease liability. Variable lease payments not dependent on a rate or index are recognized when the event, activity, or circumstance in the lease agreement upon which those payments are contingent is probable of occurring and are presented in the same line of the consolidated balance sheet as the rent expense arising from fixed payments. The Company has lease agreements with lease and non-lease components. Non-lease components are combined with the related lease components and accounted for as lease components for all classes of underlying assets.

5. LEASES

The components of lease expense for the nine months ended December 31, 2019, are disclosed in the table below.



Lease Cost	Financial Statement Classification	Nine Months Ended December 31, 2019
Operating lease cost	Cost of sales or Selling, general and administrative expense	$	17,829
Variable lease cost	Cost of sales or Selling, general and administrative expense	5,892

Financing Lease Cost:
Amortization of right-of-use assets	Depreciation and amortization	4,224
Interest on lease liability	Interest expense and other	1,579
Total lease cost (1)		$	29,524

(1) Total lease cost does not include short-term leases or sublease income, both of which are immaterial.

Supplemental cash flow information for the nine months ended December 31, 2019, is disclosed in the table below.



	Nine Months Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows used in operating leases	$	14,046
Operating cash flows used in finance leases	1,600
Financing cash flows used in finance leases	6,516

ROU assets obtained in exchange for lease liabilities
Operating leases	$	2,569
Finance leases	811

Supplemental balance sheet information related to leases as of December 31, 2019, is disclosed in the table below.



Leases	Classification	December 31, 2019
Assets
Operating lease ROU assets	Other, net	$	66,578

Finance lease ROU assets, cost	Property and equipment, net	39,364
Accumulated amortization	Property and equipment, net	(17,557		)
Finance lease ROU assets, net		21,807
Total lease assets		$	88,385

Liabilities
Current
Operating	Accrued expenses	$	14,028
Finance	Current portion of long-term debt	7,795
Noncurrent
Operating	Other noncurrent liabilities	58,152
Finance	Long-term debt, less current portion	18,172
Total lease liabilities		$	98,147

Information related to lease terms and discount rates as of December 31, 2019, is disclosed in the table below:



	December 31, 2019
Weighted average remaining lease term (years)
Operating leases	7.2
Finance leases	6.7

Weighted average discount rate
Operating leases	6.4	%
Finance leases	5.8	%

The maturity of the Company's lease liabilities as of December 31, 2019, is disclosed in the table below.



	Operating leases			Finance leases			Total
FY2020 (remaining of year)	$	7,359		$	2,348		$	9,707
FY2021	16,753			8,786			25,539
FY2022	14,451			5,751			20,202
FY2023	11,021			2,873			13,894
FY2024	8,322			2,112			10,434
Thereafter	35,810			11,263			47,073
Total lease payments	93,716			33,133			126,849
Less: Imputed interest	(21,536		)	(7,166		)	(28,702		)
Total lease liabilities	$	72,180		$	25,967		$	98,147