Leases

6 Months Ended

Jun. 30, 2020

The Company has obligations under lease arrangements primarily for facilities, equipment and vehicles. These leases have original lease periods expiring between July 2020 and August 2034. For the three and six months ended June 30, 2020, the Company recorded lease expense of $1.6 million and $3.4 million within Cost of sales, $0.1 million and $0.2 million within Research, development, and engineering, $0.1 million and $0.2 million within Selling, general and administrative and less than $0.1 million within Interest expense in the Consolidated Statements of Operations, respectively. For the three and six months ended June 30, 2019, the Company recorded lease expense of $1.8 million and $3.6 million within Cost of sales, less than $0.1 million and $0.2 million within Research, development and engineering expenses, $0.1 million within Selling, general and administrative and less than $0.1 million within Interest expense in the Consolidated Statements of Operations, respectively.

The following table summarizes the components of lease expense:



(in thousands)	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2020		2019		2020		2019
Operating lease cost	$	1,368	$	1,406	$	2,747	$	2,807
Finance lease cost
Amortization of right-of-use (“ROU”) asset	52		45		104		69
Interest expense	12		14		25		21
Short-term lease cost	108		133		217		276
Variable lease cost	374		311		797		766
Total lease cost	$	1,914	$	1,909	$	3,890	$	3,939

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



(in thousands)	For the Six Months Ended June 30,
	2020		2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows paid for operating leases	$	2,734	$	2,444
Operating cash flows paid for interest portion of finance leases	25		21
Financing cash flows paid for principal portion of finance leases	96		61
Right-of-use assets obtained in exchange for lease obligations
Operating leases	299		280
Finance leases	—		517

As of June 30, 2020 and December 31, 2019, the weighted-average remaining lease term was 6.4 years and 6.7 years for operating leases and 4.1 years and 4.5 years for finance leases, respectively. The weighted-average discount rate was 7.2% for operating leases and 6.8% for finance leases as of both June 30, 2020 and December 31, 2019.

The following table presents supplemental balance sheet information related to leases:



(in thousands)	June 30, 2020		December 31, 2019
Operating lease ROU assets, net ¹	$	19,014	$	20,677

Operating lease liabilities, current ²	3,759		3,789
Operating lease liabilities, non-current ³	16,063		17,679
Total operating lease liabilities	$	19,822	$	21,468

Finance lease ROU assets, net ¹	$	656	$	777

Finance lease liabilities, current ²	192		195
Finance lease liabilities, non-current ³	524		617
Total finance lease liabilities	$	716	$	812


1.	Included in Other noncurrent assets for operating leases and Property, plant and equipment, net for finance leases on the Consolidated Balance Sheets.


2.	Included in Other accrued liabilities for operating leases and Current maturities of long-term debt for finance leases on the Consolidated Balance Sheets.


3.	Included in Other noncurrent liabilities for operating leases and Long-term debt, net of current maturities for finance leases on the Consolidated Balance Sheets.

The following table presents maturity analysis of lease liabilities as of June 30, 2020:



(in thousands)	Operating Leases		Finance Leases
Six months ending December 31, 2020	$	2,555	$	121
Year ending December 31, 2021	4,948		243
Year ending December 31, 2022	4,788		175
Year ending December 31, 2023	3,283		101
Year ending December 31, 2024	1,813		82
Thereafter	7,399		96
Total undiscounted lease payments	24,786		818
Less: imputed interest	4,964		102
Total lease liabilities	$	19,822	$	716

Leases

The following table summarizes the components of lease expense:



(in thousands)	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2020		2019		2020		2019
Operating lease cost	$	1,368	$	1,406	$	2,747	$	2,807
Finance lease cost
Amortization of right-of-use (“ROU”) asset	52		45		104		69
Interest expense	12		14		25		21
Short-term lease cost	108		133		217		276
Variable lease cost	374		311		797		766
Total lease cost	$	1,914	$	1,909	$	3,890	$	3,939

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



(in thousands)	For the Six Months Ended June 30,
	2020		2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows paid for operating leases	$	2,734	$	2,444
Operating cash flows paid for interest portion of finance leases	25		21
Financing cash flows paid for principal portion of finance leases	96		61
Right-of-use assets obtained in exchange for lease obligations
Operating leases	299		280
Finance leases	—		517

The following table presents supplemental balance sheet information related to leases:



(in thousands)	June 30, 2020		December 31, 2019
Operating lease ROU assets, net ¹	$	19,014	$	20,677

Operating lease liabilities, current ²	3,759		3,789
Operating lease liabilities, non-current ³	16,063		17,679
Total operating lease liabilities	$	19,822	$	21,468

Finance lease ROU assets, net ¹	$	656	$	777

Finance lease liabilities, current ²	192		195
Finance lease liabilities, non-current ³	524		617
Total finance lease liabilities	$	716	$	812


1.	Included in Other noncurrent assets for operating leases and Property, plant and equipment, net for finance leases on the Consolidated Balance Sheets.


2.	Included in Other accrued liabilities for operating leases and Current maturities of long-term debt for finance leases on the Consolidated Balance Sheets.


3.	Included in Other noncurrent liabilities for operating leases and Long-term debt, net of current maturities for finance leases on the Consolidated Balance Sheets.

The following table presents maturity analysis of lease liabilities as of June 30, 2020:



(in thousands)	Operating Leases		Finance Leases
Six months ending December 31, 2020	$	2,555	$	121
Year ending December 31, 2021	4,948		243
Year ending December 31, 2022	4,788		175
Year ending December 31, 2023	3,283		101
Year ending December 31, 2024	1,813		82
Thereafter	7,399		96
Total undiscounted lease payments	24,786		818
Less: imputed interest	4,964		102
Total lease liabilities	$	19,822	$	716