LEASES

9 Months Ended

Sep. 30, 2019

Lessee Disclosure [Abstract]

LEASES

NOTE 7:-LEASES

The Company leases offices, plants and vehicles under operating and finance leases. For leases with terms greater than 12 months, the Company records the related asset and liability at the present value of lease payments according to their term. Several of the Company’s leases include renewal options and some have termination options that are factored into the Company’s determination of the lease payments when appropriate. The Company estimates the incremental borrowing rate in order to discount the lease payments based on the information available at the lease commencement date.

F - 18

SOLAREDGE TECHNOLOGIES, INC.

AND ITS SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

U.S. dollars in thousands (except share and per share data)

NOTE 7:-LEASES (cont.)

The following table summarizes the Company’s lease-related assets and liabilities recorded on the condensed consolidated balance sheet:

	Classification on the condensed consolidated Balance Sheet	As of September 30, 2019
		(Unaudited)
Assets
Operating lease assets, net of lease incentive obligation	Operating lease right-of-use assets	$	34,601
Finance lease assets	Property, plant and equipment, net		1,471
Total lease assets		$	36,072
Liabilities
Operating and finance leases short term	Accrued expenses and other current liabilities	$	9,451
Operating leases long term	Operating lease liabilities		29,117
Finance leases long term	Other non-current liabilities		874
Total lease liabilities		$	39,442
Weighted average remaining lease term in years
Operating leases			4.71
Finance leases			7.51
Weighted average annual discount rate
Operating leases			1.45	%
Finance leases			2.85	%

The following table presents certain information related to the lease costs for operating and finance leases:

	Three months ended		Nine months ended
	September 30, 2019
	(Unaudited)
Finance lease cost
Amortization of leased assets	$	20	$	73
Interest on lease liabilities		12		43
Operating lease cost		2,517		7,132
Total lease cost	$	2,549	$	7,248

F - 19

SOLAREDGE TECHNOLOGIES, INC.

AND ITS SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

U.S. dollars in thousands (except share and per share data)

NOTE 7:-LEASES (cont.)

The following table presents supplemental cash flow information related to the lease costs for operating and finance leases:

	Three months ended		Nine months ended
	September 30, 2019
	(Unaudited)
Cash paid for amounts included in measurement of lease liabilities
Operating cash flows for operating and finance leases	$	2,560	$	7,175
Financing cash flows for finance leases	$	1,248	$	1,248

The following table reconciles the undiscounted cash flows for each of the first five years and total of the remaining years of the operating and finance lease liabilities recorded on the condensed consolidated balance sheets (unaudited):

	Operating Lease			Finance Leases
2019	$	2,735		$	22
2020		9,691			88
2021		8,384			88
2022		7,528			88
2023		6,517			88
Thereafter		5,410			955
Total lease payments		40,265			1,329
Less: amount of lease payments representing interest		(1,774	)		(378	)
Present value of future lease payments		38,491			951
Less: current obligations under leases		(9,374	)		(77	)
Long-term lease obligations	$	29,117		$	874