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Leases

12 Months Ended

Dec. 31, 2022

Leases [Abstract]

Leases

Leases

The Company recognizes right-of-use assets (“ROU assets”) and lease liabilities for operating leases of real estate, mining and other equipment that expire at various dates through 2032. The majority of the Company's leases are operating leases. NACCO does not recognize leases with a term of 12 months or less on the balance sheet. Instead, the Company recognizes the related lease expense on a straight-line basis over the lease term. The Company accounts for lease and non-lease components as a single lease component. The Company's lease agreements do not contain lease payments that depend on an index or a rate, as such, minimum lease payments do not include variable lease payments.

Leased assets and liabilities include the following at December 31:

Description			Location			2022			2021
Assets
Operating			Operating lease right-of-use assets			$	6,419		$	8,911
Finance			Property, plant and equipment, net (a)			843			334
Liabilities
Current
Operating			Other current liabilities			$	1,039		$	1,463
Finance			Current maturities of long-term debt			776			150
Non-current
Operating			Operating lease liabilities			$	7,528		$	9,733
Finance			Long-term debt			19			190

(a) Finance leased assets are recorded net of accumulated amortization of $0.2 million and $0.3 million as of December 31, 2022 and December 31, 2021, respectively.

The components of lease expense for the years ended December 31 are as follows:

Description			Location			2022			2021
Lease expense
Operating lease cost			Selling, general and administrative expenses			$	1,881		$	2,122
Finance lease cost:
Amortization of leased assets			Cost of sales			128			220
Interest on lease liabilities			Interest expense			13			31
Variable lease expense			Selling, general and administrative expenses			534			571
Short-term lease expense			Selling, general and administrative expenses			3,434			1,176
Total lease expense						$	5,990		$	4,120

Future minimum finance and operating lease payments were as follows at December 31, 2022:

			Finance Leases						Operating Leases						Total
2023			$	778					$	1,599					$	2,377
2024			12						1,474						1,486
2025			7						1,283						1,290
2026			—						1,314						1,314
2027			—						1,345						1,345
Subsequent to 2027			—						4,177						4,177
Total minimum lease payments			797						11,192						$	11,989
Amounts representing interest			2						2,625
Present value of net minimum lease payments			$	795					$	8,567

As most of the Company's leases do not provide an implicit rate, the Company determines the incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The Company considers its credit rating and the current economic environment in determining this collateralized rate. The assumptions used in accounting for ASC 842 for the years ended December 31 are as follows:

			2022			2021
Weighted average remaining lease term (years)
Operating			7.66			8.38
Finance			1.41			2.44
Weighted average discount rate
Operating			7.13		%	7.08		%
Finance			3.11		%	4.16		%

The following table details cash paid for amounts included in the measurement of lease liabilities for the years ended December 31:

			2022			2021
Operating cash flows from operating leases			$	2,097		$	2,260
Operating cash flows from finance leases			13			31
Financing cash flows from finance leases			183			275

Leases

Leases

The Company recognizes right-of-use assets (“ROU assets”) and lease liabilities for operating leases of real estate, mining and other equipment that expire at various dates through 2032. The majority of the Company's leases are operating leases. NACCO does not recognize leases with a term of 12 months or less on the balance sheet. Instead, the Company recognizes the related lease expense on a straight-line basis over the lease term. The Company accounts for lease and non-lease components as a single lease component. The Company's lease agreements do not contain lease payments that depend on an index or a rate, as such, minimum lease payments do not include variable lease payments.

Leased assets and liabilities include the following at December 31:

Description			Location			2022			2021
Assets
Operating			Operating lease right-of-use assets			$	6,419		$	8,911
Finance			Property, plant and equipment, net (a)			843			334
Liabilities
Current
Operating			Other current liabilities			$	1,039		$	1,463
Finance			Current maturities of long-term debt			776			150
Non-current
Operating			Operating lease liabilities			$	7,528		$	9,733
Finance			Long-term debt			19			190

(a) Finance leased assets are recorded net of accumulated amortization of $0.2 million and $0.3 million as of December 31, 2022 and December 31, 2021, respectively.

The components of lease expense for the years ended December 31 are as follows:

Description			Location			2022			2021
Lease expense
Operating lease cost			Selling, general and administrative expenses			$	1,881		$	2,122
Finance lease cost:
Amortization of leased assets			Cost of sales			128			220
Interest on lease liabilities			Interest expense			13			31
Variable lease expense			Selling, general and administrative expenses			534			571
Short-term lease expense			Selling, general and administrative expenses			3,434			1,176
Total lease expense						$	5,990		$	4,120

Future minimum finance and operating lease payments were as follows at December 31, 2022:

			Finance Leases						Operating Leases						Total
2023			$	778					$	1,599					$	2,377
2024			12						1,474						1,486
2025			7						1,283						1,290
2026			—						1,314						1,314
2027			—						1,345						1,345
Subsequent to 2027			—						4,177						4,177
Total minimum lease payments			797						11,192						$	11,989
Amounts representing interest			2						2,625
Present value of net minimum lease payments			$	795					$	8,567

As most of the Company's leases do not provide an implicit rate, the Company determines the incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The Company considers its credit rating and the current economic environment in determining this collateralized rate. The assumptions used in accounting for ASC 842 for the years ended December 31 are as follows:

			2022			2021
Weighted average remaining lease term (years)
Operating			7.66			8.38
Finance			1.41			2.44
Weighted average discount rate
Operating			7.13		%	7.08		%
Finance			3.11		%	4.16		%

The following table details cash paid for amounts included in the measurement of lease liabilities for the years ended December 31:

			2022			2021
Operating cash flows from operating leases			$	2,097		$	2,260
Operating cash flows from finance leases			13			31
Financing cash flows from finance leases			183			275

X

- References

No definition available.

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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

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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

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