Property, Plant and Equipment, net and Intangibles, net

12 Months Ended

Jan. 02, 2021

Property, Plant and Equipment [Line Items]

Property, Plant and Equipment, net and Intangibles, net

Property, Plant and Equipment, net and Intangibles, net

Property, plant and equipment, net consisted of the following as of January 2, 2021 and December 28, 2019: 

	2020		2019
Mineral bearing land and leased interests	$	468,966	$	333,024
Land (non-mineral bearing)	197,432		182,065
Buildings and improvements	181,198		178,088
Plants, machinery and equipment	1,397,410		1,318,512
Mobile equipment and barges	543,133		501,809
Truck and auto fleet	56,163		54,838
Landfill airspace and improvements	52,202		49,766
Office equipment	45,942		43,155
Construction in progress	40,648		42,007
Property, plant and equipment	2,983,094		2,703,264
Less accumulated depreciation, depletion and amortization	(1,132,925)		(955,815)
Property, plant and equipment, net	$	1,850,169	$	1,747,449

Depreciation on property, plant and equipment, including assets subject to capital leases, is generally computed on a straight-line basis. Depletion of mineral reserves and leased mineral interests are computed based on the portion of the reserves used during the period compared to the gross estimated value of proven and probable reserves, which is updated periodically as circumstances dictate. Leasehold improvements are amortized on a straight-line basis over the lesser of the asset’s useful life or the remaining lease term. The estimated useful lives are generally as follows:

Buildings and improvements	10 - 30	years
Plant, machinery and equipment	7 - 20	years
Office equipment	3 - 7	years
Truck and auto fleet	5 - 8	years
Mobile equipment and barges	6 - 8	years
Landfill airspace and improvements	10 - 30	years
Other	4 - 20	years

Depreciation, depletion and amortization expense of property, plant and equipment was $195.3 million, $196.8 million and $199.6 million in the years ended January 2, 2021, December 28, 2019 and December 29, 2018, respectively.

Property, plant and equipment at January 2, 2021 and December 28, 2019 included $92.7 million and $82.7 million, respectively, of finance leases for certain equipment and a building with accumulated amortization of $32.8 million and $24.9 million, respectively. The equipment leases generally have terms of less than five years and the building lease had an original term of 30 years. Approximately $24.6 million and $16.0 million of the future obligations associated with the finance leases are included in accrued expenses as of January 2, 2021 and December 28, 2019, respectively, and the present value of the remaining finance lease payments, $31.7 million and $40.4 million, respectively, is included in other noncurrent liabilities on the consolidated balance sheets. Future minimum rental commitments under long-term capital leases are $26.7 million, $18.6 million, $7.1 million, $3.2 million, and $2.6 million for the years ended 2021, 2022, 2023, 2024 and 2025, respectively.

Assets are assessed for impairment charges when identified for disposition. The net gain from asset dispositions recognized in general and administrative expenses in fiscal years 2020, 2019 and 2018 was $7.6 million, $10.7 million and $12.6 million, respectively. No material impairment charges have been recognized on assets held for use in fiscal 2020, 2019 or 2018.

Intangible Assets—The Company’s intangible assets subject to amortization are primarily composed of operating permits, mineral lease agreements and reserve rights. Operating permits relate to permitting and zoning rights acquired outside of a business combination. The assets related to mineral lease agreements reflect the submarket royalty rates paid under agreements, primarily for extracting aggregates. The values were determined as of the respective acquisition dates by a comparison of market-royalty rates. The reserve rights relate to aggregate reserves to which the Company has the rights of ownership, but does not own the reserves. The intangible assets are amortized on a straight-line basis over the lives of the leases or permits, or computed based on the portion of the reserves used during the period compared to the gross estimated value of proven and probable reserves. The following table shows intangible assets by type and in total: 

	January 2, 2021						December 28, 2019
	Gross				Net		Gross				Net
	Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
	Amount		Amortization		Amount		Amount		Amortization		Amount
Operating permits	$	33,671	$	(1,207)	$	32,464	$	6,609	$	(290)	$	6,319
Mineral leases	19,225		(7,571)		11,654		19,064		(6,408)		12,656
Reserve rights	6,234		(2,504)		3,730		6,234		(2,248)		3,986
Trade names	—		—		—		1,000		(958)		42
Other	586		(582)		4		957		(462)		495
Total intangible assets	$	59,716	$	(11,864)	$	47,852	$	33,864	$	(10,366)	$	23,498

Amortization expense in fiscal 2020, 2019 and 2018 was $2.7 million, $2.1 million and $1.5 million, respectively. The estimated amortization expense for intangible assets for each of the next five years and thereafter is as follows:

2021	$	3,129
2022	3,136
2023	3,003
2024	2,908
2025	2,863
Thereafter	32,813
Total	$	47,852

Summit Materials, LLC

Property, Plant and Equipment [Line Items]

Property, Plant and Equipment, net and Intangibles, net

Property, Plant and Equipment, net and Intangibles, net

Property, plant and equipment, net consisted of the following as of January 2, 2021 and December 28, 2019:

	2020		2019
Mineral bearing land and leased interests	$	468,966	$	333,024
Land (non-mineral bearing)	197,432		182,065
Buildings and improvements	181,198		178,088
Plants, machinery and equipment	1,397,410		1,318,512
Mobile equipment and barges	543,133		501,809
Truck and auto fleet	56,163		54,838
Landfill airspace and improvements	52,202		49,766
Office equipment	45,942		43,155
Construction in progress	40,648		42,007
Property, plant and equipment	2,983,094		2,703,264
Less accumulated depreciation, depletion and amortization	(1,132,925)		(955,815)
Property, plant and equipment, net	$	1,850,169	$	1,747,449

Depreciation on property, plant and equipment, including assets subject to capital leases, is generally computed on a straight-line basis. Depletion of mineral reserves and leased mineral interests are computed based on the portion of the reserves used during the period compared to the gross estimated value of proven and probable reserves, which is updated periodically as circumstances dictate. Leasehold improvements are amortized on a straight-line basis over the lesser of the asset’s useful life or the remaining lease term. The estimated useful lives are generally as follows:

Buildings and improvements	10 - 30 years
Plant, machinery and equipment	7 - 20 years
Office equipment	3 - 7 years
Truck and auto fleet	5 - 8 years
Mobile equipment and barges	6 - 8 years
Landfill airspace and improvements	10 - 30 years
Other	4 - 20 years

Depreciation, depletion and amortization expense of property, plant and equipment was $195.3 million, $196.8 million and $199.6 million in the years ended January 2, 2021, December 28, 2019 and December 29, 2018, respectively.

Property, plant and equipment at January 2, 2021 and December 28, 2019 included $92.7 million and $82.7 million, respectively, of finance leases for certain equipment and a building with accumulated amortization of $32.8 million and $24.9 million, respectively. The equipment leases generally have terms of less than five years and the building lease had an original term of 30 years. Approximately $24.6 million and $16.0 million of the future obligations associated with the finance leases are included in accrued expenses as of January 2, 2021 and December 28, 2019, respectively, and the present value of the remaining finance lease payments, $31.7 million and $40.4 million, respectively, is included in other noncurrent liabilities on the consolidated balance sheets. Future minimum rental commitments under long-term capital leases are $26.7 million, $18.6 million, $7.1 million, $3.2 million, and $2.6 million for the years ended 2021, 2022, 2023, 2024 and 2025, respectively.

Assets are assessed for impairment charges when identified for disposition. The net gain from asset dispositions recognized in general and administrative expenses in fiscal years 2020, 2019 and 2018 was $7.6 million, $10.7 million and $12.6 million, respectively. No material impairment charges have been recognized on assets held for use in fiscal 2020, 2019 or 2018.

Intangible Assets—The Company’s intangible assets subject to amortization are primarily composed of operating permits, mineral lease agreements and reserve rights. Operating permits relate to permitting and zoning rights acquired outside of a business combination. The assets related to mineral lease agreements reflect the submarket royalty rates paid under agreements, primarily for extracting aggregates. The values were determined as of the respective acquisition dates by a comparison of market-royalty rates. The reserve rights relate to aggregate reserves to which the Company has the rights of ownership, but does not own the reserves. The intangible assets are amortized on a straight-line basis over the lives of the leases or permits, or computed based on the portion of the reserves used during the period compared to the gross estimated value of proven and probable reserves. The following table shows intangible assets by type and in total:

	January 2, 2021						December 28, 2019
	Gross				Net		Gross				Net
	Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
	Amount		Amortization		Amount		Amount		Amortization		Amount
Operating permits	$	33,671	$	(1,207)	$	32,464	$	6,609	$	(290)	$	6,319
Mineral leases	19,225		(7,571)		11,654		19,064		(6,408)		12,656
Reserve rights	6,234		(2,504)		3,730		6,234		(2,248)		3,986
Trade names	—		—		—		1,000		(958)		42
Other	586		(582)		4		957		(462)		495
Total intangible assets	$	59,716	$	(11,864)	$	47,852	$	33,864	$	(10,366)	$	23,498

Amortization expense in fiscal 2020, 2019 and 2018 was $2.7 million, $2.1 million and $1.5 million, respectively. The estimated amortization expense for intangible assets for each of the next five years and thereafter is as follows:

2021	$	3,129
2022	3,136
2023	3,003
2024	2,908
2025	2,863
Thereafter	32,813
Total	$	47,852