Leases (Notes)

12 Months Ended

Dec. 31, 2020

Leases of Lessee Disclosure [Text Block]

. LEASES

The Company's operating leases consist of rent commitments under various leases for office space, warehouses, land and buildings at varying dates from January 2021 to December 2024. The terms of most of these leases are in the range of 3 to 8 years, with certain leases renewable for varying periods. It is expected that in the normal course of business leases that expire will be renewed or replaced by leases on other similar property. Some of the Company's lease obligations have rent escalations or contingent rent that are recognized on a straight-line basis over the entire lease term. Material leasehold improvements and other landlord incentives are amortized over the shorter of their economic lives or the lease term, including renewal periods, if reasonably assured. Substantially all real estate taxes, insurance and maintenance expenses associated with leased facilities are obligations of the Company. The terms for most machinery and equipment leases range from 3 to 5 years.

The Company's finance leases are included in machinery, office furniture and equipment and construction in process and amortization of these assets is included in depreciation and amortization expense. The terms of these leases are 5 years. At December 31, 2020, $6.7 million of assets included in property, plant and equipment were accounted for as finance leases. At December 31, 2020, the Company had accumulated depreciation of $2.1 million associated with these assets. At December 31, 2019, $8.2 million of assets included in property, plant and equipment were accounted for as finance leases. At December 31, 2019, the Company had accumulated depreciation of $2.4 million associated with these assets. Additionally, $2.7 million of assets included in construction in process in property, plant and equipment, net of accumulated depreciation related to finance leases.

At the commencement date of a contract containing a lease, a right-of-use asset and lease liability are recorded to the Company's Consolidated Balance Sheets when the Company obtains control of the use of the asset. Right-of-use assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make payments upon entering into a lease agreement.

Right-of-use assets, net consisted of the following:


	Classification	December 31, 2020		December 31, 2019
In thousands
Assets
Operating lease right of use assets	Operating lease right-of-use assets, net	$	12,880	$	15,159
Finance lease right of use assets	Property, plant and equipment, net of accumulated depreciation	4,618		5,840
Total leased assets		$	17,498	$	20,999

20. LEASES (CONTINUED)

The lease liability and future rental payments are required under leases that have initial or remaining non-cancellable lease terms in excess of one year as of December 31, 2020. Lease liabilities consisted of the following:


	Classification	December 31, 2020		December 31, 2019
In thousands
Liabilities
Current
Operating lease liability, current portion	Operating lease liabilities, current portion	$	4,305	$	4,306
Finance lease liability, current portion	Other current liabilities	1,899		1,838
Noncurrent
Operating lease liability, noncurrent portion	Operating lease liabilities, noncurrent portion	9,325		11,617
Finance lease liability, noncurrent portion	Other long-term liabilities	4,315		5,559
Total lease liabilities(1)		$	19,844	$	23,320

(1) Total leased liabilities attributable to the Company's UK Composites business were included in liabilities held for sale, current portion and liabilities held for sale, noncurrent portion as of December 31, 2020 on the Company's Consolidated Balance Sheets. See Note 2, Discontinued Operations and Liabilities Held for Sale, for further information.

Future rental payments for continuing operations consisted of the following:


	December 31, 2020
In thousands

Operating leases
2021	$	4,738
2022	3,845
2023	3,184
2024	2,507
2025	285
Thereafter	—
Total future operating lease payments	$	14,559
Interest	(929)
Present value of future operating lease payments	$	13,630

Finance leases
2021	2,030
2022	1,769
2023	1,253
2024	775
2025	669
Thereafter	—
Total future finance lease payments	$	6,496
Interest	(282)
Present value of future finance lease payments	$	6,214

Present value of total future lease payments	$	19,844

20. LEASES (CONTINUED)

The following table illustrates the components of lease expense for the Company's leases.


	For the Years Ended December 31,
	2020		2019
In thousands
Finance lease cost
Amortization of right-of-use assets	$	880	$	941
Interest on lease liabilities	196		297
Operating lease cost	5,465		5,064
Short-term lease cost	443		177
Variable lease cost	96		83
Total lease expense	$	7,080	$	6,562

The following table segregates cash paid for the Company's leases from continuing operations.


	For the Years Ended December 31,
	2020		2019
In thousands
Operating cash flows from operating leases	$	(5,556)	$	(4,950)
Operating cash flows from finance leases	(1,533)		(1,609)
Financing cash flows from finance leases	(196)		(297)
Total cash flows from leasing activities	$	(7,285)	$	(6,856)

During the twelve-month fiscal period ended December 31, 2020, $4.0 million in right-of-use assets were obtained in exchange for new operating lease liabilities. No right-of-use assets were obtained in exchange for new finance lease liabilities in the year ended December 31, 2020.

Other information related to leases is as follows:


	December 31, 2020

Weighted-average remaining lease term (years)
Operating leases	3.51
Finance leases	3.81
Weighted-average discount rate
Operating leases	3.87	%
Finance leases	2.75	%