Quarterly report pursuant to Section 13 or 15(d)

LEASES

v3.21.2
LEASES
6 Months Ended
Jun. 30, 2021
LEASES  
10. LEASES

10. LEASES

 

The Company adopted ASU 2016-02 (Topic 842) effective January 1, 2019 using the modified retrospective adoption method which allowed it to initially apply the new standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of accumulated deficit. In connection with the adoption of the new lease pronouncement, the Company recorded a charge to accumulated deficit of $847.

 

A reconciliation of lease obligations for the six months ended June 30, 2021, is as follows:

 

(in thousands)

 

 

 

Lease Liability:

 

 

 

December 31, 2020

 

$ 38,834

 

Lease principal payments

 

 

(1,164 )

June 30, 2021

 

$ 37,670

 

 

 

 

 

 

 

 

June 30,

 

 

 

2021

 

Lease obligation, current portion

 

$ 2,410

 

Lease obligation, long-term portion

 

 

35,260

 

Total

 

$ 37,670

 

 

All extension options that are reasonably certain to be exercised have been included in the measurement of lease obligations. The Company reassesses the likelihood of extension option exercise if there is a significant event or change in circumstances within its control.

 

The components of lease expense for the three and six months ended June 30, 2021 and 2020 are as follows:

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30,

 

 

June 30,

 

 

June 30,

 

 

June 30,

 

(in thousands)

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Amortization of leased assets (1)

 

$ 785

 

 

$ 839

 

 

$ 1,527

 

 

$ 1,631

 

Interest on lease liabilities (2)

 

 

634

 

 

 

491

 

 

 

1,197

 

 

 

964

 

Total

 

$ 1,419

 

 

$ 1,330

 

 

$ 2,724

 

 

$ 2,595

 

____________

(1) Included in cost of goods sold and general and administrative in the consolidated statement of operations.

(2) Included in interest expense in the consolidated statement of operations.

 

The key assumptions used in accounting for leases as of June 30, 2021 were a weighted average remaining lease term of 17.6 years and a weighted average discount rate of 6%. The key assumptions used in accounting for leases as of December 31, 2020 were a weighted average remaining lease term of 18.1 years and a weighted average discount rate of 6.0%.

 

The future lease payments with initial remaining terms in excess of one year as of June 30, 2021 were as follows:

 

 

 

June 30,

 

(in thousands)

 

2021

 

Balance of 2021

 

$ 1,187

 

2022 - 2023

 

 

5,137

 

2024 - 2025

 

 

3,844

 

2026 and beyond

 

 

27,502

 

Total

 

$ 37,670