LEASES (Tables)

9 Months Ended

Sep. 28, 2019

Schedule of Cumulative Effect of Adoption of ASC 842

The cumulative effect of applying ASC 842 to all leases that had commenced as of December 30, 2018 was as follows:



Balance sheet captions impacted by ASC 842	December 30, 2018 (Prior to adoption of ASC 842)		Effect of the adoption of ASC 842				December 30, 2018 (As adjusted)
	(in thousands)
Prepaid assets	$	53,447	$	(4,413	)	⁽¹⁾	$	49,034
Property, plant and equipment, net	932,877		(23,448		)	⁽²⁾	909,429
Operating lease right-of-use assets, net	—		134,172			⁽³⁾	134,172
Other assets	143,759		(4,989		)	⁽⁴⁾	138,770
Other current liabilities	71,280		15,935			⁽⁵⁾	87,215
Operating lease right-of-use liabilities	—		111,570			⁽⁶⁾	111,570
Long-term debt, net and finance leases	1,636,598		(26,183		)	⁽⁷⁾	1,610,415
ASC 842 adoption adjustments:
⁽¹⁾ Short term prepaid rent reclassified from Prepaid assets to the Operating lease right-of-use asset.
⁽²⁾ Derecognition of approximately $26 million of leased properties, recorded in Property, plant and equipment, specifically Construction-in-process, that were recognized under the previously existing build-to-suit accounting rules; partially offset by Prepaid assets related to finance leases reclassified from Prepaid assets.
⁽³⁾ Recognition of Operating lease right-to-use asset and adjusted for prepaid rent and deferred rent liability reclassification adjustments identified in adjustments ⁽¹⁾ ⁽⁴⁾ ⁽⁵⁾.
⁽⁴⁾ Long-term prepaid rent reclassified from Other assets to the Operating lease right-of-use asset.
⁽⁵⁾ Recognition of short-term portion of the Operating lease right-of-use liabilities offset by reclassification of deferred rent liability to Operating lease right-of-use asset.
⁽⁶⁾ Recognition of long-term portion of the Operating lease right-of-use liabilities.
⁽⁷⁾ Derecognition of approximately $26 million of Other debt associated with leased properties that were recognized under the previously existing build-to-suit accounting rules.

Schedule of Right-of-Use Lease Assets and Lease Liabilities in Condensed Financial Statements

Right-of-use lease assets and lease liabilities are reported in the Company’s unaudited condensed consolidated balance sheets as follows:



	September 28, 2019
	(in thousands)
Operating leases
Operating lease right-of-use assets, net	$	140,359

Other current liabilities	$	20,032
Operating lease right-of-use liabilities	116,868
Total operating lease liabilities	$	136,900

Finance leases
Property, plant and equipment, net	$	32,076

Current portion of long-term debt and finance leases	$	3,002
Long-term debt, net and finance leases	26,710
Total finance lease liabilities	$	29,712

Schedule of Operating and Finance Lease Costs and Supplemental Cash Flow Information

Supplemental cash flow information



	Nine Months Ended
	September 28, 2019
	(in thousands)
Cash flows included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	20,084
Operating cash flows from finance leases	1,058
Finance cash flows from finance leases	2,862

Non-cash leases activity:
Right-of-use lease assets obtained in exchange for new operating lease liabilities	$	20,805
Right-of-use lease assets obtained in exchange for new finance lease liabilities	4,741

Lease term and discount rate



		As of
		September 28, 2019
Weighted-average remaining lease term (in years)
Operating lease		8.35
Finance lease		12.94
Weighted-average discount rate
Operating lease		4.37
Finance lease		4.40

The components of operating and finance lease costs for the three and nine months ended September 28, 2019 were as follows:



	September 28, 2019
	Three Months Ended			Nine Months Ended
	(in thousands)
Operating lease costs	$	7,839		$	23,433
Finance lease costs:
Amortization of right-of-use assets	1,070			2,921
Interest on lease liabilities	360			1,001
Short-term lease costs	256			652
Variable lease costs	646			1,911
Sublease income	(383		)	(474		)
Total lease costs	$	9,788		$	29,444

Schedule of Future Minimum Lease Payments Under Non-Cancellable Operating Leases After Adoption

As of September 28, 2019, maturities of operating and finance lease liabilities for each of the following five years and a total thereafter were as follows:



	Operating Leases		Finance Leases
	(in thousands)
2019 (excluding the nine months ended September 28, 2019)	$	6,264	$	1,244
2020	25,519		4,658
2021	23,993		3,651
2022	20,188		3,622
2023	16,197		2,760
Thereafter	74,148		24,235
Total minimum future lease payments	166,309		40,170
Less: Imputed interest	29,409		10,458
Total lease liabilities	$	136,900	$	29,712

Schedule of Future Minimum Lease Payments Under Non-Cancellable Finance Leases After Adoption

As of September 28, 2019, maturities of operating and finance lease liabilities for each of the following five years and a total thereafter were as follows:



	Operating Leases		Finance Leases
	(in thousands)
2019 (excluding the nine months ended September 28, 2019)	$	6,264	$	1,244
2020	25,519		4,658
2021	23,993		3,651
2022	20,188		3,622
2023	16,197		2,760
Thereafter	74,148		24,235
Total minimum future lease payments	166,309		40,170
Less: Imputed interest	29,409		10,458
Total lease liabilities	$	136,900	$	29,712

Schedule of Future Minimum Lease Payments, Non-Cancellable Operating Leases Before Adoption

As of December 29, 2018, minimum future lease payments under non-cancellable leases for each of the following five years and a total thereafter were as follows:



	Operating Leases ⁽¹⁾		Finance Leases ⁽¹⁾
	(in thousands)
2019	$	25,411	$	3,972
2020	22,400		3,759
2021	21,544		2,869
2022	18,535		2,967
2023	15,398		2,209
Thereafter	66,870		24,304
Total minimum future lease payments	$	170,158	$	40,080
⁽¹⁾ Lease commitments are presented under the guidance of ASC 840 and includes approximately $14 million of minimum future lease payments for leases that had not commenced as of December 29, 2018. These commitments relate to existing leases for which the Company does not yet control certain expansion space.

Schedule of Future Minimum Lease Payments, Non-Cancellable Capital Leases Before Adoption

As of December 29, 2018, minimum future lease payments under non-cancellable leases for each of the following five years and a total thereafter were as follows:



	Operating Leases ⁽¹⁾		Finance Leases ⁽¹⁾
	(in thousands)
2019	$	25,411	$	3,972
2020	22,400		3,759
2021	21,544		2,869
2022	18,535		2,967
2023	15,398		2,209
Thereafter	66,870		24,304
Total minimum future lease payments	$	170,158	$	40,080
⁽¹⁾ Lease commitments are presented under the guidance of ASC 840 and includes approximately $14 million of minimum future lease payments for leases that had not commenced as of December 29, 2018. These commitments relate to existing leases for which the Company does not yet control certain expansion space.