LEASES

12 Months Ended

Dec. 31, 2020

LEASES

LEASES

4. LEASES

Impact of Adoption

The Company adopted ASC 842 on January 1, 2019, utilizing the optional transition method with a cumulative adjustment on the date of adoption. Under this approach, the guidance was applied to leases that had commenced as of January 1, 2019 with a cumulative effect adjustment as of that date and prior periods were not adjusted. Upon adoption, the Company recognized an operating lease ROU asset of $70.8 million, a short-term lease liability of $8.2 million, and a long-term lease liability of $61.2 million. The adoption had no impact on retained earnings or other components of equity.

The Company elected the package of practical expedients. Under the package of practical expedients, for existing leases, the Company does not reassess: i) whether the arrangement contains a lease; ii) lease classification and; iii) initial direct costs.

The Company has operating and financing leases for towers, land, corporate offices, retail facilities, and data transport capacity. The lease terms are generally between 3 and 10 years, some of which include additional renewal options.

Supplemental lease information

The components of lease expense were as follows (in thousands):

	December 31, 2020		December 31, 2019
Operating lease cost:
Operating lease cost	$	16,409	$	15,194
Short-term lease cost		2,712		3,426
Variable lease cost		4,059		2,803
Total operating lease cost	$	23,180	$	21,423
Finance lease cost:
Amortization of right-of-use asset	$	2,181	$	2,318
Variable costs		852		964
Total finance lease cost	$	3,033	$	3,282

During the year ended December 31, 2020 and December 31, 2019, the Company paid $16.1 million and $15.1 million, respectively, related to operating lease liabilities. Also during the year ended December 31, 2020 and December 31, 2019, the Company recorded $7.8 million and $9.7 million, respectively, of lease liabilities arising from ROU assets.

At December 31, 2020, finance leases with a cost of $25.4 million and accumulated amortization of $9.5 million were included in property, plant and equipment. During the year ended December 31, 2020, the Company paid $0.4 million for finance lease liabilities and recorded $1.6 million of additional finance lease liabilities. At December 31, 2020, finance leases had a lease liability of $1.2 million, of which $0.3 million was current. At December 31, 2019, finance leases with a cost of $25.9 million and accumulated amortization of $9.4 million were included in property, plant and equipment.

The weighted average remaining lease terms and discount rates as of December 31, 2020 and December 31, 2019 are noted in the table below:

	December 31, 2020		December 31, 2019
Weighted-average remaining lease term
Operating leases		5.9 years		6.5 years
Financing leases		10.9 years		11.7 years
Weighted-average discount rate
Operating leases		5.0%		5.0%
Financing leases		3.3%		n/a

Maturities of lease liabilities as of December 31, 2020 were as follows (in thousands):

	Operating Leases
2021	$	15,211
2022		14,535
2023		12,132
2024		10,844
2025		7,816
Thereafter		13,094
Total lease payments		73,632
Less imputed interest		(10,179)
Total	$	63,453

Maturities of lease liabilities as of December 31, 2019 were as follows (in thousands):

	Operating Leases
2020	$	14,526
2021		13,714
2022		12,787
2023		10,713
2024		9,671
Thereafter		18,355
Total lease payments		79,766
Less imputed interest		(12,195)
Total	$	67,571

As of December 31, 2020, the Company did not have any material operating or finance leases that have not yet commenced.