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Leases
9 Months Ended
Sep. 30, 2023
Leases [Abstract]  
Leases
9. Leases

Operating lease right-of-use-assets and assets held under finance leases are recognized in the Condensed Consolidated Balance Sheets within Other assets and Property, plant and equipment, net, respectively. Operating lease liabilities and finance lease liabilities are recognized in the Condensed Consolidated Balance Sheets within Other liabilities and Debt obligations, respectively. Right-of-use lease assets and lease liabilities consisted of the following (in millions):
September 30,
2023
December 31, 2022
Right-of-use assets:
Operating lease (Other assets)$60.5 $65.8 
Finance lease (Property, plant and equipment, net)2.4 2.1 
Total right-of-use assets$62.9 $67.9 
Lease liabilities:
Current portion of operating lease (Other current liabilities)$13.9 $17.1 
Non-current portion of operating lease (Other liabilities)51.2 53.8 
Finance lease (Debt obligations)2.5 2.1 
Total lease liabilities$67.6 $73.0 

The tables below present financial information associated with the Company's leases. The Company has entered into operating and finance lease agreements primarily for land, office space, equipment and vehicles, expiring between 2023 and 2045.

The following table summarizes the components of lease expense (in millions):

Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
Finance lease cost:
Amortization of right-of-use assets$0.1 $0.1 $0.3 $0.2 
Interest on lease liabilities— — 0.1 — 
Net finance lease cost0.1 0.1 0.4 0.2 
Operating lease cost5.7 5.8 17.3 17.6 
Variable lease cost0.2 0.1 0.5 0.4 
Sublease income(0.1)(0.1)(0.5)(0.5)
Total lease cost$5.9 $5.9 $17.7 $17.7 
Cash flow information related to leases is as follows (in millions):

Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases$— $— $0.1 $— 
Financing cash flows from finance leases$0.1 $— $0.3 $0.1 
Operating cash flows from operating leases$5.8 $5.6 $17.8 $17.6 
Right-of-use assets obtained in exchange for new lease liabilities:
Finance leases$— $1.7 $0.6 $2.2 
Operating leases$4.4 $2.8 $8.9 $10.5 

The weighted-average remaining lease term and the weighted-average discount rate for finance leases and operating leases are as follows:
September 30,
2023
December 31, 2022
Weighted-average remaining lease term (years) - operating leases7.57.5
Weighted-average remaining lease term (years) - finance leases1.71.4
Weighted-average discount rate - operating leases5.6 %5.3 %
Weighted-average discount rate - finance leases6.7 %5.7 %

Future minimum lease commitments (undiscounted) as of September 30, 2023, were as follows (in millions):
Operating
Leases
Finance
Leases
2023$4.4 $0.1 
202416.4 1.8 
202512.9 0.3 
20269.4 0.2 
20277.0 0.2 
Thereafter29.5 — 
Total future minimum lease payments79.6 2.6 
Less: amounts representing interest(14.5)(0.1)
Total lease liability balance$65.1 $2.5 

In November 2021, INNOVATE Corp. entered into a ten-year lease agreement for a special purpose space in Palm Beach, Florida. In February 2023, the lease agreement was amended to extend the term of the lease to 15 years. The lease has not yet commenced, but will require future monthly lease payments of approximately $0.2 million over the entire lease term and yearly common area maintenance charges of $0.6 million, both of which are subject to 3% annual upward adjustments, with total square footage of 25,184, as amended. The lease also provides for the Company to receive an allowance from the landlord of $4.4 million, as amended in February 2023, to be used toward costs to design, engineer, install, supply and construct improvements (the "Construction Allowance"), payable at the end of the construction period, of which $1.1 million and $0.8 million is included in prepaid rent in Other assets as of September 30, 2023 and December 31, 2022, respectively. The future lease payments and remaining unexpended amounts under the allowance are not yet recorded in our Condensed Consolidated Balance Sheet. Management expects the accounting lease commencement date for this initial portion of the lease for financial reporting purposes to begin in 2024.

In December 2021, the Company entered into a five-year lease agreement with an option to extend the lease for another five years for office space in West Palm Beach, Florida. The new lease has not commenced yet, but will require future monthly lease payments of approximately $0.1 million over the entire lease term, subject to 3% annual upward adjustment, with total square footage of 15,786. Other than a $0.2 million deposit included in Other assets, the future lease payments are not yet recorded on our Condensed Consolidated Balance Sheets, as the building is still under construction. Management expects the accounting lease commencement date for this initial portion of the lease for financial reporting purposes to begin in 2024.
Leases
9. Leases

Operating lease right-of-use-assets and assets held under finance leases are recognized in the Condensed Consolidated Balance Sheets within Other assets and Property, plant and equipment, net, respectively. Operating lease liabilities and finance lease liabilities are recognized in the Condensed Consolidated Balance Sheets within Other liabilities and Debt obligations, respectively. Right-of-use lease assets and lease liabilities consisted of the following (in millions):
September 30,
2023
December 31, 2022
Right-of-use assets:
Operating lease (Other assets)$60.5 $65.8 
Finance lease (Property, plant and equipment, net)2.4 2.1 
Total right-of-use assets$62.9 $67.9 
Lease liabilities:
Current portion of operating lease (Other current liabilities)$13.9 $17.1 
Non-current portion of operating lease (Other liabilities)51.2 53.8 
Finance lease (Debt obligations)2.5 2.1 
Total lease liabilities$67.6 $73.0 

The tables below present financial information associated with the Company's leases. The Company has entered into operating and finance lease agreements primarily for land, office space, equipment and vehicles, expiring between 2023 and 2045.

The following table summarizes the components of lease expense (in millions):

Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
Finance lease cost:
Amortization of right-of-use assets$0.1 $0.1 $0.3 $0.2 
Interest on lease liabilities— — 0.1 — 
Net finance lease cost0.1 0.1 0.4 0.2 
Operating lease cost5.7 5.8 17.3 17.6 
Variable lease cost0.2 0.1 0.5 0.4 
Sublease income(0.1)(0.1)(0.5)(0.5)
Total lease cost$5.9 $5.9 $17.7 $17.7 
Cash flow information related to leases is as follows (in millions):

Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases$— $— $0.1 $— 
Financing cash flows from finance leases$0.1 $— $0.3 $0.1 
Operating cash flows from operating leases$5.8 $5.6 $17.8 $17.6 
Right-of-use assets obtained in exchange for new lease liabilities:
Finance leases$— $1.7 $0.6 $2.2 
Operating leases$4.4 $2.8 $8.9 $10.5 

The weighted-average remaining lease term and the weighted-average discount rate for finance leases and operating leases are as follows:
September 30,
2023
December 31, 2022
Weighted-average remaining lease term (years) - operating leases7.57.5
Weighted-average remaining lease term (years) - finance leases1.71.4
Weighted-average discount rate - operating leases5.6 %5.3 %
Weighted-average discount rate - finance leases6.7 %5.7 %

Future minimum lease commitments (undiscounted) as of September 30, 2023, were as follows (in millions):
Operating
Leases
Finance
Leases
2023$4.4 $0.1 
202416.4 1.8 
202512.9 0.3 
20269.4 0.2 
20277.0 0.2 
Thereafter29.5 — 
Total future minimum lease payments79.6 2.6 
Less: amounts representing interest(14.5)(0.1)
Total lease liability balance$65.1 $2.5 

In November 2021, INNOVATE Corp. entered into a ten-year lease agreement for a special purpose space in Palm Beach, Florida. In February 2023, the lease agreement was amended to extend the term of the lease to 15 years. The lease has not yet commenced, but will require future monthly lease payments of approximately $0.2 million over the entire lease term and yearly common area maintenance charges of $0.6 million, both of which are subject to 3% annual upward adjustments, with total square footage of 25,184, as amended. The lease also provides for the Company to receive an allowance from the landlord of $4.4 million, as amended in February 2023, to be used toward costs to design, engineer, install, supply and construct improvements (the "Construction Allowance"), payable at the end of the construction period, of which $1.1 million and $0.8 million is included in prepaid rent in Other assets as of September 30, 2023 and December 31, 2022, respectively. The future lease payments and remaining unexpended amounts under the allowance are not yet recorded in our Condensed Consolidated Balance Sheet. Management expects the accounting lease commencement date for this initial portion of the lease for financial reporting purposes to begin in 2024.

In December 2021, the Company entered into a five-year lease agreement with an option to extend the lease for another five years for office space in West Palm Beach, Florida. The new lease has not commenced yet, but will require future monthly lease payments of approximately $0.1 million over the entire lease term, subject to 3% annual upward adjustment, with total square footage of 15,786. Other than a $0.2 million deposit included in Other assets, the future lease payments are not yet recorded on our Condensed Consolidated Balance Sheets, as the building is still under construction. Management expects the accounting lease commencement date for this initial portion of the lease for financial reporting purposes to begin in 2024.