Leases

3 Months Ended

Mar. 31, 2023

12.LEASES

The Company determines if an arrangement is a lease at inception. The right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. The Company uses its incremental borrowing rate in each of the jurisdictions in which its subsidiaries operate to calculate the present value of lease payments. Lease terms may include options to extend or terminate the lease. These options are included in the lease term when it is reasonably certain that the Company will exercise those options. Operating lease expense is recorded on a straight-line basis over the lease term.

The Company accounts for lease agreements with lease and non-lease components as a single lease component for all asset classes. The Company does not establish ROU assets or lease liabilities for operating leases with terms of 12 months or less.

The Company’s operating and finance leases include land, casino space, corporate offices, and gaming and other equipment. The leases have remaining lease terms of one month to 14 years.

The components of lease expense were as follows:


	For the three months ended
	March 31,
Amounts in thousands	2023		2022
Operating lease expense	$	1,334	$	1,386

Finance lease expense:
Amortization of right-of-use assets	$	24	$	42
Interest on lease liabilities		9		5
Total finance lease expense	$	33	$	47

Variable lease expense	$	293	$	454

Variable lease expense relates primarily to rates based on changes in indexes that are excluded from the lease liability and fluctuations in foreign currency related to leases in Poland.

Supplemental cash flow information related to leases was as follows:


	For the three months ended
	March 31,
Amounts in thousands	2023		2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	9	$	4
Operating cash flows from operating leases		1,249		1,344
Financing cash flows from finance leases		38		41

Right-of-use assets obtained in exchange for operating lease liabilities	$	48	$	—

‎

Supplemental balance sheet information related to leases was as follows:


	As of		As of
Amounts in thousands	March 31, 2023		December 31, 2022
Operating leases
Leased right-of-use assets, net	$	24,532	$	27,190

Current portion of operating lease liabilities		3,768		3,947
Operating lease liabilities, net of current portion		23,642		26,016
Total operating lease liabilities		27,410		29,963

Finance leases
Finance lease right-of-use assets, gross		768		764
Accumulated depreciation		(202)		(175)
Property and equipment, net		566		589

Current portion of finance lease liabilities		150		150
Finance lease liabilities, net of current portion		363		399
Total finance lease liabilities		513		549

Weighted-average remaining lease term
Operating leases		10.0 years		10.5 years
Finance leases		3.3 years		3.6 years

Weighted-average discount rate
Operating leases		6.4%		4.9%
Finance leases		7.0%		7.0%

Maturities of lease liabilities as of March 31, 2023 were as follows:


Amounts in thousands		Operating Leases	Finance Leases
2023	$	3,948	$	137
2024		4,572		178
2025		3,497		161
2026		3,213		85
2027		3,201		15
Thereafter		20,913		—
Total lease payments		39,344		576
Less imputed interest		(11,934)		(63)
Total	$	27,410	$	513