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Note 11 - Leases
6 Months Ended
Jun. 25, 2022
Notes to Financial Statements  
Lessee, Leases [Text Block]

11.

Leases

 

We lease certain of our facilities, equipment and vehicles under non-cancelable operating and finance leases. Leases with initial terms of 12 months or less are not recorded on the condensed consolidated balance sheet, but we recognize those lease payments in the condensed consolidated statements of income on a straight-line basis over the lease term. Lease and non-lease components are included in the calculation of the ROU asset and lease liabilities.

 

Our leases have remaining lease terms of 1 year to 36 years, some of which include one or more options to extend the leases for up to 25 years. Our lease term includes renewal terms when we are reasonably certain we will exercise the renewal options. We sublease certain leased assets to third parties, mainly as a result of unused space in our facilities.

 

Supplemental balance sheet information related to leases was as follows:

 

(in thousands)

Classification

 

June 25, 2022

  

December 25, 2021

 

Assets

         

Operating lease assets

Operating lease right-of-use assets

 $23,519  $25,060 

Finance lease assets

Property, plant and equipment, net (1)

  355   423 

Total lease assets

 $23,874  $25,483 

Liabilities

         

Current

         

Operating

Other accrued liabilities

 $4,838  $4,886 

Finance

Other accrued liabilities

  119   167 

Noncurrent

         

Operating

Long-term lease liabilities

  20,412   21,977 

Finance

Long-term lease liabilities

  34   63 

Total lease liabilities

 $25,403  $27,093 
          

Weighted-average remaining lease term (years)

        

Operating leases

  6.6   6.9 

Finance leases

  1.5   1.8 
          

Weighted-average discount rate

        

Operating leases

  6.3%  6.3%

Finance leases

  1.0%  0.7%

 

 

(1)

Finance lease assets are recorded net of accumulated amortization of $0.2 million and $0.1 million as of June 25, 2022 and December 25, 2021, respectively.

 

The components of lease expense were as follows:

 

  

Three Months Ended

  

Six Months Ended

 

(in thousands)

 

June 25, 2022

  

June 26, 2021

  

June 25, 2022

  

June 26, 2021

 

Operating leases

 $1,676  $2,027  $3,392  $4,067 

Variable lease expense

  526   574   1,063   1,126 

Short-term operating leases

  1   34   2   67 

Finance leases

                

Amortization of leased assets

  26   24   58   45 

Interest on lease liabilities

  1   1   1   1 

Sublease income

  (18)  (21)  (38)  (40)

Net lease cost

 $2,212  $2,639  $4,478  $5,266 

 

Future minimum lease payments at June 25, 2022, are as follows:

 

  

Operating

  

Finance

     

(in thousands)

 

leases (1)

  

leases

  

Total

 

2022

 $3,237  $84  $3,321 

2023

  5,731   48   5,779 

2024

  5,260   11   5,271 

2025

  5,058   11   5,069 

2026

  2,738   3   2,741 

Thereafter

  9,586   -   9,586 

Total lease payments

  31,610   157   31,767 

Less: Interest

  (6,361)  (3)  (6,364)

Present value of lease liabilities

 $25,249  $154  $25,403 

 

 

 (1)

Excludes sublease income of $0.1 million in 2023.

 

Supplemental cash flow information related to leases was as follows:

 

  

Six Months Ended

 

(in thousands)

 

June 25, 2022

  

June 26, 2021

 

Cash paid for amounts included in the measurement of lease liabilities:

        

Operating cash flows from operating leases

 $3,329  $4,308 

Operating cash flows from finance leases

 $1  $- 

Financing cash flows from finance leases

 $86  $91 

Leased assets obtained in exchange for new finance lease liabilities

 $-  $54 

Leased assets obtained in exchange for new operating lease liabilities

 $1,251  $2,827