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Leases

12 Months Ended

Jan. 01, 2023

LEASES

General

The Company has operating and finance leases for manufacturing equipment, corporate offices, showrooms, distribution facilities, design centers, as well as computer and office equipment. The Company’s leases have terms ranging from 1 to 20 years, some of which may include options to extend the lease term for up to 5 years, and certain leases may include an option to terminate the lease. Our lease accounting may include these options to extend or terminate a lease when it is reasonably certain that we will exercise that option.

As of January 1, 2023, there were no significant leases that had not commenced.

The table below represents a summary of the balances recorded in the consolidated balance sheets related to the Company’s leases as of January 1, 2023 and January 2, 2022:


	January 1, 2023				January 2, 2022
Balance Sheet Location	Operating Leases		Finance Leases		Operating Leases		Finance Leases
	(in thousands)
Operating lease right-of-use assets	$	81,644			$	90,561

Current portion of operating lease liabilities	$	11,857			$	14,588
Operating lease liabilities	72,305				77,905
Total operating lease liabilities	$	84,162			$	92,493

Property, plant and equipment, net			$	5,845			$	6,547

Accrued expenses			$	2,101			$	1,837
Other long-term liabilities			4,138				3,201
Total finance lease liabilities			$	6,239			$	5,038

Lease Costs


	Fiscal Year
	2022		2021		2020
	(in thousands)
Finance lease cost:
Amortization of right-of-use assets	$	2,238	$	2,653	$	1,251
Interest on lease liabilities	164		140		86
Operating lease cost	18,916		21,581		25,213
Short-term lease cost	849		977		525
Variable lease cost	2,692		2,831		3,970
Total lease cost	$	24,859	$	28,182	$	31,045

Other Supplemental Information


	Fiscal Year
	2022		2021		2020
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	128	$	108	$	86
Operating cash flows from operating leases	18,080		22,210		22,206
Financing cash flows from finance leases	2,089		2,282		1,727
Right-of-use assets obtained in exchange for new finance lease liabilities	3,436		3,259		2,546
Right-of-use assets obtained in exchange for new operating lease liabilities	9,307		13,330		2,504

Lease Term and Discount Rate

The table below presents the weighted average remaining lease terms and discount rates for finance and operating leases as of January 1, 2023 and January 2, 2022:


	End of Fiscal Year
	2022		2021
Weighted-average remaining lease term – finance leases (in years)	3.82		3.20
Weighted-average remaining lease term – operating leases (in years)	9.29		9.97
Weighted-average discount rate – finance leases	3.79	%	2.82	%
Weighted-average discount rate – operating leases	5.89	%	5.87	%

Maturity Analysis

A maturity analysis of lease payments under non-cancellable leases is presented as follows:


Fiscal Year	Operating Leases		Finance Leases
	(in thousands)
2023	$	14,572	$	2,266
2024	13,851		1,890
2025	11,998		1,124
2026	12,197		610
2027	9,926		412
Thereafter	49,249		472
Total future minimum lease payments (undiscounted)	111,793		6,774
Less: Present value discount	(27,631)		(535)
Total lease liability	$	84,162	$	6,239

Leases