XML 28 R20.htm IDEA: XBRL DOCUMENT v3.23.1

Leases

3 Months Ended

Apr. 02, 2023

Leases [Abstract]

Leases

Leases

The Company routinely enters into leasing arrangements for real estate (including manufacturing facilities, office space, and warehouses), transportation equipment (automobiles, forklifts, and trailers), and office equipment (copiers and postage machines). The assessment of the certainty associated with the exercise of various lease renewal, termination, and purchase options included in the Company's lease contracts is performed after contemplating all the relevant facts and circumstances in accordance with guidance under ASC 842 - Leases. Most real estate leases, in particular, include one or more options to renew, with renewal terms that typically extend the lease term in increments from one to five years. The Company's leases do not have any significant residual value guarantees or restrictive covenants.

As the implicit rate in the Company's leases is normally not readily determinable, the Company generally calculates its lease liabilities using discount rates based upon the Company’s incremental secured borrowing rate, which contemplates and reflects a particular geographical region’s interest rate for the leases active within that region of the Company’s global operations. The Company further utilizes a portfolio approach by assigning a “short” rate to contracts with lease terms of 10 years or less and a “long” rate for contracts greater than 10 years.

The Company completed the acquisition of Metal Packaging on January 26, 2022, which included the acquisition of $33,910 in operating lease liabilities and $46,687 in finance lease liabilities as of the date of acquisition.

The following table sets forth the balance sheet location and aggregate values of the Company’s lease assets and lease liabilities at April 2, 2023 and December 31, 2022:

Classification						Balance Sheet Location						April 2, 2023			December 31, 2022
Lease Assets
Operating lease assets						Right of Use Asset - Operating Leases						$	289,017		$	296,781
Finance lease assets						Other Assets						102,216			103,467
Total lease assets												$	391,233		$	400,248
Lease Liabilities
Current operating lease liabilities						Accrued expenses and other						$	51,537		$	52,306
Current finance lease liabilities						Notes payable and current portion of debt						19,606			19,015
Total current lease liabilities												$	71,143		$	71,321
Noncurrent operating lease liabilities						Noncurrent Operating Lease Liabilities						$	243,714		$	250,994
Noncurrent finance lease liabilities						Long-term Debt, Net of Current Portion						81,732			83,905
Total noncurrent lease liabilities												$	325,446		$	334,899
Total lease liabilities												$	396,589		$	406,220

Certain of the Company’s leases include variable costs. Variable costs include lease payments that were volume or usage-driven in accordance with the use of the underlying asset, and also non-lease components that were incurred based upon actual terms rather than contractually fixed amounts. In addition, variable costs are incurred for lease payments that are indexed to a change in rate or index. Because the right of use assets recorded on the balance sheet were determined based upon factors considered at the commencement date of the leases, subsequent changes in the rate or index that were not contemplated in the right of use asset balances recorded on the balance sheet result in variable expenses being incurred when paid during the lease term.

The following table sets forth the components of the Company’s total lease cost for the three-month periods ended April 2, 2023 and April 3, 2022:

						Three Months Ended
Lease Cost						April 2, 2023			April 3, 2022
Operating lease cost			(a)			$	13,411		$	12,797
Finance lease cost:
Amortization of lease asset			(a)			3,270			2,711
Interest on lease liabilities			(b)			1,194			966
Variable lease cost			(a) (c)			9,378			7,355
Total lease cost						$	27,253		$	23,829

(a) Production-related and administrative amounts are included in cost of sales and selling, general and administrative expenses, respectively.

(b) Included in interest expense.

(c) Also includes short term lease costs, which are deemed immaterial.

The following table sets forth certain lease-related information for the three-month periods ended April 2, 2023 and April 3, 2022:

						Three Months Ended
						April 2, 2023			April 3, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used by operating leases						$	13,561		$	13,152
Operating cash flows used by finance leases						$	1,194		$	966
Financing cash flows used by finance leases						$	4,581		$	2,643
Noncash investing and financing activities:
Leased assets obtained in exchange for new operating lease liabilities						$	6,513		$	19,520
Leased assets obtained in exchange for new finance lease liabilities						$	2,805		$	5,910
Modification to leased assets for increase in operating lease liabilities						$	3,957		$	1,484
Modification to leased assets for increase in finance lease liabilities						$	—		$	290
Termination reclasses to decrease operating lease assets						$	(2,029)		$	(1,913)
Termination reclasses to decrease operating lease liabilities						$	(2,090)		$	(1,828)
Termination reclasses to decrease finance lease assets						$	(962)		$	—
Termination reclasses to decrease finance lease liabilities						$	(12)		$	—

Leases

Leases

The Company routinely enters into leasing arrangements for real estate (including manufacturing facilities, office space, and warehouses), transportation equipment (automobiles, forklifts, and trailers), and office equipment (copiers and postage machines). The assessment of the certainty associated with the exercise of various lease renewal, termination, and purchase options included in the Company's lease contracts is performed after contemplating all the relevant facts and circumstances in accordance with guidance under ASC 842 - Leases. Most real estate leases, in particular, include one or more options to renew, with renewal terms that typically extend the lease term in increments from one to five years. The Company's leases do not have any significant residual value guarantees or restrictive covenants.

As the implicit rate in the Company's leases is normally not readily determinable, the Company generally calculates its lease liabilities using discount rates based upon the Company’s incremental secured borrowing rate, which contemplates and reflects a particular geographical region’s interest rate for the leases active within that region of the Company’s global operations. The Company further utilizes a portfolio approach by assigning a “short” rate to contracts with lease terms of 10 years or less and a “long” rate for contracts greater than 10 years.

The Company completed the acquisition of Metal Packaging on January 26, 2022, which included the acquisition of $33,910 in operating lease liabilities and $46,687 in finance lease liabilities as of the date of acquisition.

The following table sets forth the balance sheet location and aggregate values of the Company’s lease assets and lease liabilities at April 2, 2023 and December 31, 2022:

Classification						Balance Sheet Location						April 2, 2023			December 31, 2022
Lease Assets
Operating lease assets						Right of Use Asset - Operating Leases						$	289,017		$	296,781
Finance lease assets						Other Assets						102,216			103,467
Total lease assets												$	391,233		$	400,248
Lease Liabilities
Current operating lease liabilities						Accrued expenses and other						$	51,537		$	52,306
Current finance lease liabilities						Notes payable and current portion of debt						19,606			19,015
Total current lease liabilities												$	71,143		$	71,321
Noncurrent operating lease liabilities						Noncurrent Operating Lease Liabilities						$	243,714		$	250,994
Noncurrent finance lease liabilities						Long-term Debt, Net of Current Portion						81,732			83,905
Total noncurrent lease liabilities												$	325,446		$	334,899
Total lease liabilities												$	396,589		$	406,220

Certain of the Company’s leases include variable costs. Variable costs include lease payments that were volume or usage-driven in accordance with the use of the underlying asset, and also non-lease components that were incurred based upon actual terms rather than contractually fixed amounts. In addition, variable costs are incurred for lease payments that are indexed to a change in rate or index. Because the right of use assets recorded on the balance sheet were determined based upon factors considered at the commencement date of the leases, subsequent changes in the rate or index that were not contemplated in the right of use asset balances recorded on the balance sheet result in variable expenses being incurred when paid during the lease term.

The following table sets forth the components of the Company’s total lease cost for the three-month periods ended April 2, 2023 and April 3, 2022:

						Three Months Ended
Lease Cost						April 2, 2023			April 3, 2022
Operating lease cost			(a)			$	13,411		$	12,797
Finance lease cost:
Amortization of lease asset			(a)			3,270			2,711
Interest on lease liabilities			(b)			1,194			966
Variable lease cost			(a) (c)			9,378			7,355
Total lease cost						$	27,253		$	23,829

(a) Production-related and administrative amounts are included in cost of sales and selling, general and administrative expenses, respectively.

(b) Included in interest expense.

(c) Also includes short term lease costs, which are deemed immaterial.

The following table sets forth certain lease-related information for the three-month periods ended April 2, 2023 and April 3, 2022:

						Three Months Ended
						April 2, 2023			April 3, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used by operating leases						$	13,561		$	13,152
Operating cash flows used by finance leases						$	1,194		$	966
Financing cash flows used by finance leases						$	4,581		$	2,643
Noncash investing and financing activities:
Leased assets obtained in exchange for new operating lease liabilities						$	6,513		$	19,520
Leased assets obtained in exchange for new finance lease liabilities						$	2,805		$	5,910
Modification to leased assets for increase in operating lease liabilities						$	3,957		$	1,484
Modification to leased assets for increase in finance lease liabilities						$	—		$	290
Termination reclasses to decrease operating lease assets						$	(2,029)		$	(1,913)
Termination reclasses to decrease operating lease liabilities						$	(2,090)		$	(1,828)
Termination reclasses to decrease finance lease assets						$	(962)		$	—
Termination reclasses to decrease finance lease liabilities						$	(12)		$	—

X

- References

No definition available.

+ Details

Name:	us-gaap_LeasesAbstract
Namespace Prefix:	us-gaap_
Data Type:	xbrli:stringItemType
Balance Type:	na
Period Type:	duration

X

- Definition

The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 20
-URI https://asc.fasb.org/subtopic&trid=77888251

+ Details

Name:	us-gaap_LesseeFinanceLeasesTextBlock
Namespace Prefix:	us-gaap_
Data Type:	dtr-types:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 20
-URI https://asc.fasb.org/subtopic&trid=77888251

+ Details

Name:	us-gaap_LesseeOperatingLeasesTextBlock
Namespace Prefix:	us-gaap_
Data Type:	dtr-types:textBlockItemType
Balance Type:	na
Period Type:	duration