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LEASES | 9 Months Ended
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Sep. 28, 2019
Leases [Abstract] |
LEASES | LEASES The Company enters into operating leases for offices, operational facilities, retail locations, vehicles and other assets that expire at various dates through 2031. Leases for real estate typically have initial terms ranging from 2 to 15 years, generally with renewal options. Leases for equipment typically have initial terms ranging from 3 to 7 years. Most leases have fixed rentals, with many of the real estate leases requiring additional payments for real estate taxes and occupancy-related costs. These lease terms may include optional renewals, terminations or purchases, which are considered in the Company’s assessments when such options are reasonably certain to be exercised. For retail real estate leases, the Company does not typically include renewal options in the underlying lease term. For non-retail real estate leases, when renewal options are reasonably certain to be exercised, the Company includes the renewal options in the underlying lease term, up to a maximum of ten years. Renewals for all other leases are determined on a lease-by-lease basis. Upon adoption of ASU 2016-02, the Company elected the package of practical expedients permitted under the new lease standard, which allowed the Company to carry forward its historical assessment of whether a contract contained a lease, how the lease was classified, and if initial direct costs could be capitalized. The Company elected to combine non-lease components with the related lease components for real estate, vehicles and other significant asset arrangements. The Company elected to aggregate the combined items as a single lease component for accounting purposes. Lastly, for leases with a lease term of 12 months or less for all classes of underlying assets, the Company elected not to recognize a right-of-use asset and related lease liability. Certain of the Company’s leases contain fixed, indexed, or market-based escalation clauses which impact future payments. Certain arrangements contain variable payment provisions, such as payments based on sales volumes or amounts and mileage, or excess mileage. The Company’s leases typically contain customary covenants and restrictions. The Company determines whether a contract is a lease at inception. This typically requires more judgment in storage and service arrangements where the Company must determine whether its rights to specific physical or production capacity may represent substantially all of the available capacity. The Company measures right-of-use assets and related lease liabilities based on the present value of remaining lease payments, including in-substance fixed payments, the current payment amount when payments depend on an index or rate (e.g., inflation adjustments, market renewals), and the amount the Company believes is probable to be paid to the lessor under residual value guarantees, when applicable. Lease contracts may include fixed payments for non-lease components, such as maintenance, which are included in the measurement of lease liabilities for certain asset classes based on the Company’s election to combine lease and non-lease components. As applicable borrowing rates are not typically implied within our lease arrangements, the Company discounts lease payments based on its estimated incremental borrowing rate at lease commencement, or modification, which is based on the Company’s estimated credit rating, the lease term at commencement and the contract currency of the lease arrangement. The following table presents the lease-related assets and liabilities recorded in the Company's balance sheet:
(in thousands) |  |  | September 2019 |
Assets |  |  |  |
Operating lease assets, noncurrent |  |  | $ | 96,590 |  |
Total lease assets |  |  | $ | 96,590 |  |
Liabilities |  |  |  |
Operating lease liabilities, current |  |  | $ | 35,992 |  |
Operating lease liabilities, noncurrent |  |  | 64,328 |  |
Total lease liabilities |  |  | $ | 100,320 |  |
Weighted-average remaining lease term (in years) |  |  |
Operating leases |  |  | 4.14 |  |
Weighted-average discount rate |  |  |  |
Operating leases |  |  | 2.73 | % |
Lease costs The following table presents certain information related to the lease costs for operating leases:
(in thousands) |  | Three Months Ended September 2019 |  |  |  |  | Nine Months Ended September 2019 |
Operating lease cost |  | $ | 9,924 |  |  |  |  |  | $ | 28,880 |  |
Short-term lease cost (excluding leases of one month or less) |  | 877 |  |  |  |  |  | 2,383 |  |
Variable lease cost |  | 873 |  |  |  |  |  | 4,424 |  |
Total lease costs |  | $ | 11,674 |  |  |  |  |  | $ | 35,687 |  |
Rent expense associated with operating leases for the three and nine months ended September 2018 totaled approximately $10.6 million and $31.8 million, respectively. Other information The following table presents supplemental cash flow and non-cash information related to leases:
(in thousands) |  | Nine Months Ended September 2019 |
Cash paid for amounts included in the measurement of lease liabilities - operating cash flows |  | $ | 34,486 |  |
Right-of-use assets obtained in exchange for new operating leases - non-cash activity |  | $ | 38,939 |  |
The following table presents maturities of operating lease liabilities as of September 2019:
(in thousands) |  | Lease Obligations |
2019 (excluding the nine months ended September 2019) |  | $ | 11,185 |  |
2020 |  | 36,656 |  |
2021 |  | 23,796 |  |
2022 |  | 12,980 |  |
2023 |  | 9,639 |  |
Thereafter |  | 13,013 |  |
Total future minimum lease payments |  | 107,269 |  |
Less: amounts related to imputed interest |  | (6,949 | ) |
Present value of future minimum lease payments |  | 100,320 |  |
Less: operating lease liabilities, current |  | (35,992 | ) |
Operating lease liabilities, noncurrent |  | $ | 64,328 |  |
As of September 2019, the Company has entered into approximately $1.1 million of operating lease arrangements, on an undiscounted basis, that have not yet commenced. The Company continuously monitors and may negotiate contract amendments that include extensions or modifications to existing leases. The following table presents the future minimum lease payments during the noncancelable lease terms as of December 2018, prior to the adoption of ASU 2016-02:
(in thousands) |  | December 2018
2019 |  | $ | 33,562 |
2020 |  | 29,246 |
2021 |  | 17,810 |
2022 |  | 7,932 |
2023 |  | 4,353 |
Thereafter |  | 4,582 |
Total future minimum lease payments |  | $ | 97,485 |

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- 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 http://asc.fasb.org/subtopic&trid=77888251 + Details
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