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Leases
 12 Months Ended
Dec. 31, 2023
Leases [Abstract]  
Leases Leases
Sale-Leaseback Transaction
In December 2021, we entered into a sale-leaseback transaction for the building and related land for our Gardena performance center located in Carson, California (“Sale-Leaseback Agreement”). The building and related land was sold for $143.1 million and we had no continuing involvement. The carrying value of the building and related land was $9.4 million and we recognized a gain of $132.5 million. As part of the Sale-Leaseback Agreement, we entered into an initial five year lease for the usage of the
just sold building and related land, with three options to renew in five year increments. The lease was classified as an operating lease and the future minimum base monthly lease payments during the initial five year period in aggregate total $19.6 million.
All Leases
We elected to utilize the following practical expedients that are permitted under ASC 842:
•As an accounting policy election by class of underlying asset, elected not to separate nonlease components from lease components and instead to account for each separate lease component and the nonlease components associated with that lease component as a single lease component; and
•As an accounting policy election not to apply the recognition requirements in ASC 842 to short term leases (a lease at commencement date has a lease term of 12 months or less and does not contain a purchase option that the lessee is reasonably certain to exercise).
We have operating and finance leases for manufacturing facilities, corporate offices, and various equipment. Our leases have remaining lease terms of 1 to 9 years, some of which include options to extend the leases for up to 15 years, and some of which include options to terminate the leases within 1 year.
The components of lease expense consisted of the following:
(In thousands)
Years Ended
December 31, 2023December 31, 2022
Operating leases expense$10,855 10,521 
Finance leases expense:
Amortization of right-of-use assets$358 343 
Interest on lease liabilities48 53 
Total finance lease expense$406 $396 
Short term and variable lease expenses for the year ended December 31, 2023 were not material.
Supplemental cash flow information related to leases was as follows:
(In thousands)
Years Ended
December 31, 2023December 31, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$8,853 $7,669 
Operating cash flows from finance leases$48 $53 
Financing cash flows from finance leases$340 $346 
Right-of-use assets obtained in exchange for lease obligations:
Operating leases$5,348 $8,332 
Finance leases$— $245 
The weighted average remaining lease terms were as follows:
(In years)
December 31, 2023December 31, 2022
Operating leases45
Finance leases56
When a lease is identified, we recognize a right-of-use asset and a corresponding lease liability based on the present value of the lease payments over the lease term discounted using our incremental borrowing rate, unless an implicit rate is readily determinable. As the discount rate in our leases is usually not readily available, we use our own incremental borrowing rate as the discount rate. Our incremental borrowing rate is based on the interest rate on our term loan, which is a secured rate. After
we completed a financing of all our existing debt in July 2022, the interest rate on our term loan was based on Term Secured Overnight Financing Rate (“Term SOFR”) plus an applicable margin. Prior to the refinancing, the interest rate on our term loans were based on London Interbank Offered Rate (“LIBOR”) plus an applicable margin.
The weighted average discount rates were as follows:
Years Ended
December 31, 2023December 31, 2022
Operating leases3.0%3.0%
Finance leases3.7%3.6%
Maturity of operating and finance lease liabilities are as follows:
(In thousands)
Operating LeasesFinance Leases
2024$8,647 $321 
20258,398 262 
20268,113 208 
20272,885 175 
20282,385 135 
Thereafter2,505 176 
Total lease payments32,933 1,277 
Less imputed interest2,113 113 
Total$30,820 $1,164 
Operating lease payments related to options to extend lease terms that are reasonably certain of being exercised are not significant. As of December 31, 2023, there are no legally binding minimum lease payments for leases signed but not yet commenced.
Finance lease payments related to options to extend lease terms that are reasonably certain of being exercised are not significant. As of December 31, 2023, there are no legally binding minimum lease payments for leases signed but not yet commenced.
Leases Leases
Sale-Leaseback Transaction
In December 2021, we entered into a sale-leaseback transaction for the building and related land for our Gardena performance center located in Carson, California (“Sale-Leaseback Agreement”). The building and related land was sold for $143.1 million and we had no continuing involvement. The carrying value of the building and related land was $9.4 million and we recognized a gain of $132.5 million. As part of the Sale-Leaseback Agreement, we entered into an initial five year lease for the usage of the
just sold building and related land, with three options to renew in five year increments. The lease was classified as an operating lease and the future minimum base monthly lease payments during the initial five year period in aggregate total $19.6 million.
All Leases
We elected to utilize the following practical expedients that are permitted under ASC 842:
•As an accounting policy election by class of underlying asset, elected not to separate nonlease components from lease components and instead to account for each separate lease component and the nonlease components associated with that lease component as a single lease component; and
•As an accounting policy election not to apply the recognition requirements in ASC 842 to short term leases (a lease at commencement date has a lease term of 12 months or less and does not contain a purchase option that the lessee is reasonably certain to exercise).
We have operating and finance leases for manufacturing facilities, corporate offices, and various equipment. Our leases have remaining lease terms of 1 to 9 years, some of which include options to extend the leases for up to 15 years, and some of which include options to terminate the leases within 1 year.
The components of lease expense consisted of the following:
(In thousands)
Years Ended
December 31, 2023December 31, 2022
Operating leases expense$10,855 10,521 
Finance leases expense:
Amortization of right-of-use assets$358 343 
Interest on lease liabilities48 53 
Total finance lease expense$406 $396 
Short term and variable lease expenses for the year ended December 31, 2023 were not material.
Supplemental cash flow information related to leases was as follows:
(In thousands)
Years Ended
December 31, 2023December 31, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$8,853 $7,669 
Operating cash flows from finance leases$48 $53 
Financing cash flows from finance leases$340 $346 
Right-of-use assets obtained in exchange for lease obligations:
Operating leases$5,348 $8,332 
Finance leases$— $245 
The weighted average remaining lease terms were as follows:
(In years)
December 31, 2023December 31, 2022
Operating leases45
Finance leases56
When a lease is identified, we recognize a right-of-use asset and a corresponding lease liability based on the present value of the lease payments over the lease term discounted using our incremental borrowing rate, unless an implicit rate is readily determinable. As the discount rate in our leases is usually not readily available, we use our own incremental borrowing rate as the discount rate. Our incremental borrowing rate is based on the interest rate on our term loan, which is a secured rate. After
we completed a financing of all our existing debt in July 2022, the interest rate on our term loan was based on Term Secured Overnight Financing Rate (“Term SOFR”) plus an applicable margin. Prior to the refinancing, the interest rate on our term loans were based on London Interbank Offered Rate (“LIBOR”) plus an applicable margin.
The weighted average discount rates were as follows:
Years Ended
December 31, 2023December 31, 2022
Operating leases3.0%3.0%
Finance leases3.7%3.6%
Maturity of operating and finance lease liabilities are as follows:
(In thousands)
Operating LeasesFinance Leases
2024$8,647 $321 
20258,398 262 
20268,113 208 
20272,885 175 
20282,385 135 
Thereafter2,505 176 
Total lease payments32,933 1,277 
Less imputed interest2,113 113 
Total$30,820 $1,164 
Operating lease payments related to options to extend lease terms that are reasonably certain of being exercised are not significant. As of December 31, 2023, there are no legally binding minimum lease payments for leases signed but not yet commenced.
Finance lease payments related to options to extend lease terms that are reasonably certain of being exercised are not significant. As of December 31, 2023, there are no legally binding minimum lease payments for leases signed but not yet commenced.