XML 31 R17.htm IDEA: XBRL DOCUMENT
v3.19.2

Leases | 6 Months Ended
--- | ---
Jun. 30, 2019
Leases [Abstract] |
Leases | Leases We adopted ASC 842 on January 1, 2019, and elected the modified retrospective approach in which the new standard is applied to all leases existing at the date of adoption through a cumulative-effect adjustment of less than $0.1 million to retained deficit. Consequently, financial information is not updated, and the disclosures required under the new standard are not provided for periods prior to January 1, 2019. As part of the adoption, we elected the package of practical expedients, the short-term lease exemption, and the practical expedient to not separate lease and non-lease components permitted within ASC 842. Accordingly, we accounted for our existing operating leases as operating leases under the new standard, without reassessing (a) whether the contracts contain a lease under ASC 842, (b) whether classification of the operating leases would be different in accordance with ASC 842, or (c) whether any unamortized initial direct costs would have met the definition of initial direct costs in ASC 842 at lease commencement. We determine whether an arrangement is a lease at inception. Right-of-use (“ROU”) lease assets represent our right to use an underlying asset for the lease term, and lease obligations represent our obligation to make lease payments arising from the lease. ROU lease assets and obligations are recognized at the lease commencement date based on the present value of lease payments over the lease term. When the implicit rate is not readily determinable, we use the estimated incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Amortization of ROU lease assets is recognized in expense on a straight-line basis over the lease term. Short-term leases are leases having a term of twelve months or less. We recognize short-term leases on a straight-line basis and do not record a related lease asset or liability for such leases. Finance lease ROU assets consist of equipment used in the manufacturing process with terms between thirteen months and five years. Operating lease ROU assets consist of the following:
• | Equipment used in the manufacturing process as well as office equipment with terms between thirteen months and five years; and
• | Manufacturing plants and office facilities with terms between thirteen months and 25 years.
The following table presents components of lease expense for the three and six months ended June 30, 2019:
|  | Financial Statement Line Item |  | Three Months Ended June 30, 2019 |  | Six Months Ended June 30, 2019
Lease cost: |  |  |  |  |  |
Finance lease cost |  |  |  |  |  |
Amortization of right-of-use assets |  | Depreciation and amortization |  | $ | 361 |  |  | $ | 683 |
Interest expense |  | Interest expense |  | 56 |  |  | 109 |
Operating lease cost |  | Cost of sales and selling, general and administrative expense |  | 3,398 |  |  | 6,833 |
Short-term lease cost (1) |  | Cost of sales and selling, general and administrative expense |  | 105 |  |  | 211 |
Total lease cost |  |  |  | $ | 3,920 |  |  | $ | 7,836 |
_______________________________ (1) Excludes expenses related to leases with a lease term of one month or less. The following table presents the lease-related assets and liabilities recorded on the balance sheet as of June 30, 2019:
|  | Financial Statement Line Item |  | June 30, 2019
Lease assets and liabilities: |  |  |  |
Assets |  |  |  |
Operating lease assets |  | Operating lease right-of-use assets |  | $ | 65,300 |
Finance lease assets |  | Property, plant and equipment, net |  | 13,534 |
Total lease assets |  |  |  | $ | 78,834 |
Liabilities |  |  |  |
Current liabilities |  |  |  |
Operating lease liabilities |  | Current portion of operating lease liabilities |  | $ | 7,272 |
Finance lease liabilities |  | Other current liabilities |  | 2,331 |
Non-current liabilities |  |  |  |
Operating lease liabilities |  | Operating lease liabilities, net of current portion |  | 64,152 |
Finance lease liabilities |  | Other non-current liabilities |  | 6,376 |
Total lease liabilities |  |  |  | $ | 80,131 |
The following table contains supplemental information related to leases for the six months ended June 30, 2019:
Supplemental Cash Flows Information |  | Six Months Ended June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities |  |
Operating cash flows from finance leases |  | $ | 109 |
Operating cash flows from operating leases |  | 10,667 |
Financing cash flows from finance leases |  | 1,618 |
Right-of-use assets obtained in exchange for new operating lease liabilities |  | $ | 2,878 |
As of June 30, 2019, the weighted average remaining lease term and weighted-average discount rate for finance and operating leases was as follows:
|  | Weighted-Average Remaining Lease Term (years) |  | Weighted-Average Discount Rate
Finance leases |  | 3.9 |  | 2.4 | %
Operating leases |  | 10.1 |  | 8.2 | %
The maturities of lease liabilities in excess of twelve months as of June 30, 2019, is as follows:
|  | Operating Leases |  | Finance Leases
2019 (1) |  | $ | 6,612 |  |  | $ | 1,542 |
2020 |  | 11,885 |  |  | 2,263 |
2021 |  | 11,025 |  |  | 2,249 |
2022 |  | 10,768 |  |  | 2,030 |
2023 |  | 9,233 |  |  | 1,118 |
Thereafter |  | 57,127 |  |  | 72 |
Total future minimum lease payments |  | 106,650 |  |  | 9,274 |
Less: imputed interest |  | 35,226 |  |  | 567 |
Total lease liabilities |  | $ | 71,424 |  |  | $ | 8,707 |
(1) | For the period from July 1, 2019 to December 31, 2019.
As of June 30, 2019, we have an additional operating lease commitment that has not yet commenced that would require us to pay a total of approximately $21.9 million base rent payments over the lease term of 15 years. This lease is expected to commence during the third quarter of 2020. The following table summarizes the future minimum lease payments under operating leases with initial or non-cancelable lease terms in excess of one year prior to adoption of ASC 842 as reported in the 2018 Annual Report.
Year Ending December 31, |  |
2019 |  | $ | 13,337 |
2020 |  | 11,515 |
2021 |  | 10,557 |
2022 |  | 10,293 |
2023 |  | 8,752 |
Thereafter |  | 53,945 |
Total minimum payments |  | $ | 108,399 |
During the three and six months ended June 30, 2018, we recognized rent expense of $2.4 million and $4.5 million, respectively.
Leases | Leases We adopted ASC 842 on January 1, 2019, and elected the modified retrospective approach in which the new standard is applied to all leases existing at the date of adoption through a cumulative-effect adjustment of less than $0.1 million to retained deficit. Consequently, financial information is not updated, and the disclosures required under the new standard are not provided for periods prior to January 1, 2019. As part of the adoption, we elected the package of practical expedients, the short-term lease exemption, and the practical expedient to not separate lease and non-lease components permitted within ASC 842. Accordingly, we accounted for our existing operating leases as operating leases under the new standard, without reassessing (a) whether the contracts contain a lease under ASC 842, (b) whether classification of the operating leases would be different in accordance with ASC 842, or (c) whether any unamortized initial direct costs would have met the definition of initial direct costs in ASC 842 at lease commencement. We determine whether an arrangement is a lease at inception. Right-of-use (“ROU”) lease assets represent our right to use an underlying asset for the lease term, and lease obligations represent our obligation to make lease payments arising from the lease. ROU lease assets and obligations are recognized at the lease commencement date based on the present value of lease payments over the lease term. When the implicit rate is not readily determinable, we use the estimated incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Amortization of ROU lease assets is recognized in expense on a straight-line basis over the lease term. Short-term leases are leases having a term of twelve months or less. We recognize short-term leases on a straight-line basis and do not record a related lease asset or liability for such leases. Finance lease ROU assets consist of equipment used in the manufacturing process with terms between thirteen months and five years. Operating lease ROU assets consist of the following:
• | Equipment used in the manufacturing process as well as office equipment with terms between thirteen months and five years; and
• | Manufacturing plants and office facilities with terms between thirteen months and 25 years.
The following table presents components of lease expense for the three and six months ended June 30, 2019:
|  | Financial Statement Line Item |  | Three Months Ended June 30, 2019 |  | Six Months Ended June 30, 2019
Lease cost: |  |  |  |  |  |
Finance lease cost |  |  |  |  |  |
Amortization of right-of-use assets |  | Depreciation and amortization |  | $ | 361 |  |  | $ | 683 |
Interest expense |  | Interest expense |  | 56 |  |  | 109 |
Operating lease cost |  | Cost of sales and selling, general and administrative expense |  | 3,398 |  |  | 6,833 |
Short-term lease cost (1) |  | Cost of sales and selling, general and administrative expense |  | 105 |  |  | 211 |
Total lease cost |  |  |  | $ | 3,920 |  |  | $ | 7,836 |
_______________________________ (1) Excludes expenses related to leases with a lease term of one month or less. The following table presents the lease-related assets and liabilities recorded on the balance sheet as of June 30, 2019:
|  | Financial Statement Line Item |  | June 30, 2019
Lease assets and liabilities: |  |  |  |
Assets |  |  |  |
Operating lease assets |  | Operating lease right-of-use assets |  | $ | 65,300 |
Finance lease assets |  | Property, plant and equipment, net |  | 13,534 |
Total lease assets |  |  |  | $ | 78,834 |
Liabilities |  |  |  |
Current liabilities |  |  |  |
Operating lease liabilities |  | Current portion of operating lease liabilities |  | $ | 7,272 |
Finance lease liabilities |  | Other current liabilities |  | 2,331 |
Non-current liabilities |  |  |  |
Operating lease liabilities |  | Operating lease liabilities, net of current portion |  | 64,152 |
Finance lease liabilities |  | Other non-current liabilities |  | 6,376 |
Total lease liabilities |  |  |  | $ | 80,131 |
The following table contains supplemental information related to leases for the six months ended June 30, 2019:
Supplemental Cash Flows Information |  | Six Months Ended June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities |  |
Operating cash flows from finance leases |  | $ | 109 |
Operating cash flows from operating leases |  | 10,667 |
Financing cash flows from finance leases |  | 1,618 |
Right-of-use assets obtained in exchange for new operating lease liabilities |  | $ | 2,878 |
As of June 30, 2019, the weighted average remaining lease term and weighted-average discount rate for finance and operating leases was as follows:
|  | Weighted-Average Remaining Lease Term (years) |  | Weighted-Average Discount Rate
Finance leases |  | 3.9 |  | 2.4 | %
Operating leases |  | 10.1 |  | 8.2 | %
The maturities of lease liabilities in excess of twelve months as of June 30, 2019, is as follows:
|  | Operating Leases |  | Finance Leases
2019 (1) |  | $ | 6,612 |  |  | $ | 1,542 |
2020 |  | 11,885 |  |  | 2,263 |
2021 |  | 11,025 |  |  | 2,249 |
2022 |  | 10,768 |  |  | 2,030 |
2023 |  | 9,233 |  |  | 1,118 |
Thereafter |  | 57,127 |  |  | 72 |
Total future minimum lease payments |  | 106,650 |  |  | 9,274 |
Less: imputed interest |  | 35,226 |  |  | 567 |
Total lease liabilities |  | $ | 71,424 |  |  | $ | 8,707 |
(1) | For the period from July 1, 2019 to December 31, 2019.
As of June 30, 2019, we have an additional operating lease commitment that has not yet commenced that would require us to pay a total of approximately $21.9 million base rent payments over the lease term of 15 years. This lease is expected to commence during the third quarter of 2020. The following table summarizes the future minimum lease payments under operating leases with initial or non-cancelable lease terms in excess of one year prior to adoption of ASC 842 as reported in the 2018 Annual Report.
Year Ending December 31, |  |
2019 |  | $ | 13,337 |
2020 |  | 11,515 |
2021 |  | 10,557 |
2022 |  | 10,293 |
2023 |  | 8,752 |
Thereafter |  | 53,945 |
Total minimum payments |  | $ | 108,399 |
During the three and six months ended June 30, 2018, we recognized rent expense of $2.4 million and $4.5 million, respectively.

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 http://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeFinanceLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum: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 http://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeOperatingLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration