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Leases (Tables)

3 Months Ended

Mar. 31, 2019

Schedule of Supplemental Balance Sheet Information Related to Operating Leases

Supplemental balance sheet information related to operating leases is as follows:

		March 31,		January 1,
(In thousands)	Classification	2019		2019
Assets
Operating lease asset	Other assets	$	9,502	$	10,322
Total lease assets		$	9,502	$	10,322

Liabilities
Current operating lease liability	Accrued expenses	$	2,718	$	2,948
Non-current operating lease liability	Other non-current liabilities		6,801		7,374
Total lease liability		$	9,519	$	10,322

Components of Lease Expense included in Consolidated Statement of Income

The components of lease expense included in the Consolidated Statement of Income for the three months ended March 31, 2019 are as follows:

(In thousands)	Classification	Three Months Ended March 31, 2019
Operating lease expense	Selling, general and administrative expenses	$	349
Operating lease expense	Research and development expenses		454
Operating lease expense	Cost of sales		16
Total lease expense		$	819

Schedule of Maturity of Lease Liabilities

As of March 31, 2019, the maturity of lease liabilities included on the Consolidated Balance Sheet are as follows:

(In thousands)	Amount
Remainder of 2019	$	2,363
2020		2,185
2021		2,032
2022		1,544
2023		1,163
Thereafter		747
Total lease payments		10,034
Less: Interest		(515	)
Present value of lease liabilities	$	9,519

Future Minimum Rental Payments under Non-Cancelable Operating Leases, Including Renewals Determined to be Reasonably Assured, with Original Maturities of Greater than 12 Months

As of December 31, 2018, future minimum rental payments under non-cancelable operating leases, including renewals determined to be reasonably assured as of December 31, 2018, with original maturities of greater than 12 months are as follows:

(In thousands)	Amount (1)
2019	$	3,873
2020		3,580
2021		2,771
2022		2,053
2023		1,317
Thereafter		762
Total	$	14,356

(1)

Certain renewal options were subsequently determined to not be reasonably assured of renewal upon adoption of the new lease standard.

Schedule of Weighted Average Remaining Lease Term and Weighted Average Discount Rate

Our leases do not provide an implicit borrowing rate and therefore we use an incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We used the incremental borrowing rate on January 1, 2019, for operating leases that commenced on or prior to that date. The incremental borrowing rate was determined on a portfolio basis by grouping leases with similar terms as well as grouping leases based on a U.S. dollar or Euro functional currency. The actual rate is then determined based on a credit spread over LIBOR as well as the Bloomberg Curve Matrix for the U.S. Communications section.

	As of March 31, 2019
Weighted average remaining lease term (years)
Operating leases with USD functional currency		3.0
Operating leases with Euro functional currency		5.1
Weighted average discount rate
Operating leases with USD functional currency		4.61	%
Operating leases with Euro functional currency		1.85	%

Schedule of Supplemental Cash Flow Information Related to Leases

Supplemental cash flow information related to leases were as follows:

(In thousands)	As of March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities / assets
Cash used in operating activities related to operating leases		$ (811	)

Right-of-use assets obtained in exchange for lease obligations		$ 10,387

Components of Net Investment in Sales-Type Leases

As of March 31, 2019 and December 31, 2018, the components of the net investment in sales-type leases were as follows:

	March 31,		December 31,
(In thousands)	2019		2018
Current minimum lease payments receivable (included in other receivables)	$	9,349	$	11,339
Non-current minimum lease payments receivable (included in other assets)		1,494		1,670
Total minimum lease payments receivable		10,843		13,009
Less: Current unearned revenue		573		631
Less: Non-current unearned revenue		343		473
Net investment in sales-type leases	$	9,927	$	11,905

Schedule of Components of Sales-type Lease Gross Profit and Interest Income Included in Consolidated Statement of Income

The components of sales-type lease gross profit recognized at the lease commencement date and interest income, included in the Consolidated Statement of Income for the three months ended March 31, 2019 are as follows:

(In thousands)	Classification	Three Months Ended March 31, 2019
Sales type leases	Sales - products	$	1,512
Sales type leases	Cost of sales - products		591
Sales type leases	Gross profit	$	921

Sales type leases	Interest and dividend income	$	87

Schedule of Future Minimum Lease Payments to be Received from Sales-Type Leases

Future minimum lease payments to be received from sales-type leases as of March 31, 2019 are as follows:

(In thousands)	Amount ⁽¹⁾
Remainder of 2019	$	9,005
2020		1,056
2021		493
2022		209
2023		78
Thereafter		2
Total	$	10,843

(1)

A significant portion of these future minimum lease payments relates to one of our customers who filed for Chapter 11 bankruptcy in February 2019. In March 2019, we reached an agreement with this customer and they continue to make payments as outlined in the lease agreements. Therefore, we believe there is no potential risk of uncollectibility related to these outstanding balances.