LEASES

6 Months Ended

Jun. 30, 2021

Leases [Abstract]

LEASES

LEASES

Certain real property assets for our Copley, Ohio location were sold on March 15, 2021, as described in Note 24. In conjunction with the sale, we executed a leaseback agreement commencing March 16, 2021 and expiring on March 31, 2033. The lease is classified as a finance lease with total future minimum payments during the initial term of the lease of approximately $5.7 million as of June 30, 2021. An incremental borrowing rate of 7.19% was used to determine the right-of-use (the "ROU") asset. We recorded a $3.6 million ROU asset in net property, plant and equipment, and finance lease and corresponding liabilities of $3.8 million in other accrued liabilities and other non-current finance liabilities in the Condensed Consolidated Balance Sheets as of June 30, 2021.

The components of lease expense included on our Condensed Consolidated Statements of Operations were as follows:

		Three months ended June 30,				Six months ended June 30,
(in thousands)	Classification	2021		2020		2021		2020
Operating lease expense:
Operating lease expense	Selling, general and administrative expenses	$	1,308	$	1,389	$	2,647	$	2,896
Short-term lease expense	Selling, general and administrative expenses	1,486		292		2,641		480
Variable lease expense (1)	Selling, general and administrative expenses	471		(382)		679		394
Total operating lease expense		$	3,265	$	1,299	$	5,967	$	3,770
Finance lease expense:
Amortization of right-of-use assets	Selling, general and administrative expenses	$	1,069	$	514	$	1,598	$	1,029
Interest on lease liabilities	Interest expense	708		616		1,324		1,231
Total finance lease expense		$	1,777	$	1,130	$	2,922	$	2,260
Sublease income (2)	Other – net	$	(21)	$	(21)	$	(43)	$	(43)
Net lease cost		$	5,021	$	2,408	$	8,846	$	5,987

(1) Variable lease expense primarily consists of common area maintenance expenses paid directly to lessors of real estate leases.

(2) Sublease income excludes rental income from owned properties, which is not material.

Other information related to leases is as follows:

	Six months ended June 30,
(in thousands)	2021		2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	2,674	$	2,743
Operating cash flows from finance leases	1,324		1,231
Financing cash flows from finance leases	834		(399)

(in thousands)	June 30, 2021			December 31, 2020
Right-of-use assets obtained in exchange for lease liabilities:
Operating leases	$	1,281		$	2,629
Finance leases	$	6,589		$	146
Weighted-average remaining lease term:
Operating leases (in years)	2.8			3.1
Finance leases (in years)	12.5			13.9
Weighted-average discount rate:
Operating leases	9.11		%	9.26		%
Finance leases	7.88		%	8.00		%

Amounts relating to leases were presented on our Condensed Consolidated Balance Sheets in the following line items:

(in thousands)
Assets:	Classification	June 30, 2021		December 31, 2020
Operating lease assets	Right-of-use assets	$	9,399	$	10,814
Finance lease assets	Net property, plant and equipment, and finance lease	33,469		28,477
Total non-current lease assets		$	42,868	$	39,291
Liabilities:
Current
Operating lease liabilities	Operating lease liabilities	$	3,728	$	3,995
Finance lease liabilities	Other accrued liabilities	3,095		886
Non-current
Operating lease liabilities	Non-current operating lease liabilities	5,888		7,031
Finance lease liabilities	Non-current finance lease liabilities	33,237		29,690
Total lease liabilities		$	45,948	$	41,602

Future minimum lease payments required under non-cancellable leases as of June 30, 2021 were as follows:

(in thousands)	Operating Leases		Finance Leases		Total
2021 (excluding the six months ended June 30, 2021)	$	2,410	$	2,860	$	5,270
2022	3,864		5,233		9,097
2023	2,572		3,879		6,451
2024	1,468		3,944		5,412
2025	411		3,969		4,380
Thereafter	7		38,412		38,419
Total	$	10,732	$	58,297	$	69,029
Less imputed interest	(1,116)		(21,965)		(23,081)
Lease liability	$	9,616	$	36,332	$	45,948

LEASES

LEASES

Certain real property assets for our Copley, Ohio location were sold on March 15, 2021, as described in Note 24. In conjunction with the sale, we executed a leaseback agreement commencing March 16, 2021 and expiring on March 31, 2033. The lease is classified as a finance lease with total future minimum payments during the initial term of the lease of approximately $5.7 million as of June 30, 2021. An incremental borrowing rate of 7.19% was used to determine the right-of-use (the "ROU") asset. We recorded a $3.6 million ROU asset in net property, plant and equipment, and finance lease and corresponding liabilities of $3.8 million in other accrued liabilities and other non-current finance liabilities in the Condensed Consolidated Balance Sheets as of June 30, 2021.

The components of lease expense included on our Condensed Consolidated Statements of Operations were as follows:

		Three months ended June 30,				Six months ended June 30,
(in thousands)	Classification	2021		2020		2021		2020
Operating lease expense:
Operating lease expense	Selling, general and administrative expenses	$	1,308	$	1,389	$	2,647	$	2,896
Short-term lease expense	Selling, general and administrative expenses	1,486		292		2,641		480
Variable lease expense (1)	Selling, general and administrative expenses	471		(382)		679		394
Total operating lease expense		$	3,265	$	1,299	$	5,967	$	3,770
Finance lease expense:
Amortization of right-of-use assets	Selling, general and administrative expenses	$	1,069	$	514	$	1,598	$	1,029
Interest on lease liabilities	Interest expense	708		616		1,324		1,231
Total finance lease expense		$	1,777	$	1,130	$	2,922	$	2,260
Sublease income (2)	Other – net	$	(21)	$	(21)	$	(43)	$	(43)
Net lease cost		$	5,021	$	2,408	$	8,846	$	5,987

(1) Variable lease expense primarily consists of common area maintenance expenses paid directly to lessors of real estate leases.

(2) Sublease income excludes rental income from owned properties, which is not material.

Other information related to leases is as follows:

	Six months ended June 30,
(in thousands)	2021		2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	2,674	$	2,743
Operating cash flows from finance leases	1,324		1,231
Financing cash flows from finance leases	834		(399)

(in thousands)	June 30, 2021			December 31, 2020
Right-of-use assets obtained in exchange for lease liabilities:
Operating leases	$	1,281		$	2,629
Finance leases	$	6,589		$	146
Weighted-average remaining lease term:
Operating leases (in years)	2.8			3.1
Finance leases (in years)	12.5			13.9
Weighted-average discount rate:
Operating leases	9.11		%	9.26		%
Finance leases	7.88		%	8.00		%

Amounts relating to leases were presented on our Condensed Consolidated Balance Sheets in the following line items:

(in thousands)
Assets:	Classification	June 30, 2021		December 31, 2020
Operating lease assets	Right-of-use assets	$	9,399	$	10,814
Finance lease assets	Net property, plant and equipment, and finance lease	33,469		28,477
Total non-current lease assets		$	42,868	$	39,291
Liabilities:
Current
Operating lease liabilities	Operating lease liabilities	$	3,728	$	3,995
Finance lease liabilities	Other accrued liabilities	3,095		886
Non-current
Operating lease liabilities	Non-current operating lease liabilities	5,888		7,031
Finance lease liabilities	Non-current finance lease liabilities	33,237		29,690
Total lease liabilities		$	45,948	$	41,602

Future minimum lease payments required under non-cancellable leases as of June 30, 2021 were as follows:

(in thousands)	Operating Leases		Finance Leases		Total
2021 (excluding the six months ended June 30, 2021)	$	2,410	$	2,860	$	5,270
2022	3,864		5,233		9,097
2023	2,572		3,879		6,451
2024	1,468		3,944		5,412
2025	411		3,969		4,380
Thereafter	7		38,412		38,419
Total	$	10,732	$	58,297	$	69,029
Less imputed interest	(1,116)		(21,965)		(23,081)
Lease liability	$	9,616	$	36,332	$	45,948

LEASES

LEASES

Certain real property assets for our Copley, Ohio location were sold on March 15, 2021, as described in Note 24. In conjunction with the sale, we executed a leaseback agreement commencing March 16, 2021 and expiring on March 31, 2033. The lease is classified as a finance lease with total future minimum payments during the initial term of the lease of approximately $5.7 million as of June 30, 2021. An incremental borrowing rate of 7.19% was used to determine the right-of-use (the "ROU") asset. We recorded a $3.6 million ROU asset in net property, plant and equipment, and finance lease and corresponding liabilities of $3.8 million in other accrued liabilities and other non-current finance liabilities in the Condensed Consolidated Balance Sheets as of June 30, 2021.

The components of lease expense included on our Condensed Consolidated Statements of Operations were as follows:

		Three months ended June 30,				Six months ended June 30,
(in thousands)	Classification	2021		2020		2021		2020
Operating lease expense:
Operating lease expense	Selling, general and administrative expenses	$	1,308	$	1,389	$	2,647	$	2,896
Short-term lease expense	Selling, general and administrative expenses	1,486		292		2,641		480
Variable lease expense (1)	Selling, general and administrative expenses	471		(382)		679		394
Total operating lease expense		$	3,265	$	1,299	$	5,967	$	3,770
Finance lease expense:
Amortization of right-of-use assets	Selling, general and administrative expenses	$	1,069	$	514	$	1,598	$	1,029
Interest on lease liabilities	Interest expense	708		616		1,324		1,231
Total finance lease expense		$	1,777	$	1,130	$	2,922	$	2,260
Sublease income (2)	Other – net	$	(21)	$	(21)	$	(43)	$	(43)
Net lease cost		$	5,021	$	2,408	$	8,846	$	5,987

(1) Variable lease expense primarily consists of common area maintenance expenses paid directly to lessors of real estate leases.

(2) Sublease income excludes rental income from owned properties, which is not material.

Other information related to leases is as follows:

	Six months ended June 30,
(in thousands)	2021		2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	2,674	$	2,743
Operating cash flows from finance leases	1,324		1,231
Financing cash flows from finance leases	834		(399)

(in thousands)	June 30, 2021			December 31, 2020
Right-of-use assets obtained in exchange for lease liabilities:
Operating leases	$	1,281		$	2,629
Finance leases	$	6,589		$	146
Weighted-average remaining lease term:
Operating leases (in years)	2.8			3.1
Finance leases (in years)	12.5			13.9
Weighted-average discount rate:
Operating leases	9.11		%	9.26		%
Finance leases	7.88		%	8.00		%

Amounts relating to leases were presented on our Condensed Consolidated Balance Sheets in the following line items:

(in thousands)
Assets:	Classification	June 30, 2021		December 31, 2020
Operating lease assets	Right-of-use assets	$	9,399	$	10,814
Finance lease assets	Net property, plant and equipment, and finance lease	33,469		28,477
Total non-current lease assets		$	42,868	$	39,291
Liabilities:
Current
Operating lease liabilities	Operating lease liabilities	$	3,728	$	3,995
Finance lease liabilities	Other accrued liabilities	3,095		886
Non-current
Operating lease liabilities	Non-current operating lease liabilities	5,888		7,031
Finance lease liabilities	Non-current finance lease liabilities	33,237		29,690
Total lease liabilities		$	45,948	$	41,602

Future minimum lease payments required under non-cancellable leases as of June 30, 2021 were as follows:

(in thousands)	Operating Leases		Finance Leases		Total
2021 (excluding the six months ended June 30, 2021)	$	2,410	$	2,860	$	5,270
2022	3,864		5,233		9,097
2023	2,572		3,879		6,451
2024	1,468		3,944		5,412
2025	411		3,969		4,380
Thereafter	7		38,412		38,419
Total	$	10,732	$	58,297	$	69,029
Less imputed interest	(1,116)		(21,965)		(23,081)
Lease liability	$	9,616	$	36,332	$	45,948