XML 44 R19.htm IDEA: XBRL DOCUMENT

Leases

12 Months Ended

Dec. 31, 2020

NACCO adopted ASU 2016-02, Leases (Topic 842), on January 1, 2019. The most significant effect to the Consolidated Balance Sheet relates to the recognition of new right-of-use assets (“ROU assets”) and lease liabilities for operating leases of real estate, mining and other equipment that expire at various dates through 2031. The majority of the Company's leases are operating leases. See the table below for further information on the Consolidated Balance Sheet. The Company's lease agreements do not contain lease payments that depend on an index or a rate, as such, minimum lease payments do not include variable lease payments.

Leased assets and liabilities include the following:


Description	Location	DECEMBER 31 2020		DECEMBER 31 2019
Assets
Operating	Operating lease right-of-use assets	$	10,324	$	11,398
Finance	Property, plant and equipment, net (a)	1,478		544


Liabilities
Current
Operating	Other current liabilities	$	1,457	$	1,318
Finance	Current maturities of long-term debt	1,188		558
Noncurrent
Operating	Operating lease liabilities	$	11,196	$	12,448
Finance	Long-term debt	280		85

(a) Finance leased assets are recorded net of accumulated amortization of $0.2 million and $1.9 million as of December 31, 2020 and December 31, 2019, respectively.

The components of lease expense for the years ended December 31 are as follows:


Description	Location	2020		2019
Lease expense
Operating lease cost	Selling, general and administrative expenses	$	2,103	$	2,251
Finance lease cost:
Amortization of leased assets	Cost of sales	164		570
Interest on lease liabilities	Interest expense	19		18
Variable lease expense	Selling, general and administrative expenses	588		555
Short-term lease expense	Selling, general and administrative expenses	260		298
Total lease expense		$	3,134	$	3,692

Future minimum finance and operating lease payments were as follows at December 31, 2020:


	Finance Leases		Operating Leases		Total
2021	$	1,229	$	2,260	$	3,489
2022	124		2,181		2,305
2023	102		1,705		1,807
2024	63		1,661		1,724
2025	7		1,469		1,476
Subsequent to 2025	—		7,952		7,952
Total minimum lease payments	1,525		17,228		$	18,753
Amounts representing interest	57		4,575
Present value of net minimum lease payments	$	1,468	$	12,653

As most of the Company's leases do not provide an implicit rate, the Company determines the incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The Company considers its credit rating and the current economic environment in determining this collateralized rate. The assumptions used in accounting for ASC 842 for the years ended December 31 are as follows:


Lease term and discount rate	2020		2019
Weighted average remaining lease term (years)
Operating	8.92		9.63
Finance	1.38		0.75

Weighted average discount rate
Operating	7.00	%	6.99	%
Finance	4.11	%	5.95	%

The following table details cash paid for amounts included in the measurement of lease liabilities for the years ended December 31:


Cash paid for amounts included in the measurement of lease liabilities	2020		2019
Operating cash flows from operating leases	$	2,223	$	2,299
Operating cash flows from finance leases	19		18
Financing cash flows from finance leases	623		534

Leases

Leased assets and liabilities include the following:


Description	Location	DECEMBER 31 2020		DECEMBER 31 2019
Assets
Operating	Operating lease right-of-use assets	$	10,324	$	11,398
Finance	Property, plant and equipment, net (a)	1,478		544


Liabilities
Current
Operating	Other current liabilities	$	1,457	$	1,318
Finance	Current maturities of long-term debt	1,188		558
Noncurrent
Operating	Operating lease liabilities	$	11,196	$	12,448
Finance	Long-term debt	280		85

(a) Finance leased assets are recorded net of accumulated amortization of $0.2 million and $1.9 million as of December 31, 2020 and December 31, 2019, respectively.

The components of lease expense for the years ended December 31 are as follows:


Description	Location	2020		2019
Lease expense
Operating lease cost	Selling, general and administrative expenses	$	2,103	$	2,251
Finance lease cost:
Amortization of leased assets	Cost of sales	164		570
Interest on lease liabilities	Interest expense	19		18
Variable lease expense	Selling, general and administrative expenses	588		555
Short-term lease expense	Selling, general and administrative expenses	260		298
Total lease expense		$	3,134	$	3,692

Future minimum finance and operating lease payments were as follows at December 31, 2020:


	Finance Leases		Operating Leases		Total
2021	$	1,229	$	2,260	$	3,489
2022	124		2,181		2,305
2023	102		1,705		1,807
2024	63		1,661		1,724
2025	7		1,469		1,476
Subsequent to 2025	—		7,952		7,952
Total minimum lease payments	1,525		17,228		$	18,753
Amounts representing interest	57		4,575
Present value of net minimum lease payments	$	1,468	$	12,653


Lease term and discount rate	2020		2019
Weighted average remaining lease term (years)
Operating	8.92		9.63
Finance	1.38		0.75

Weighted average discount rate
Operating	7.00	%	6.99	%
Finance	4.11	%	5.95	%

The following table details cash paid for amounts included in the measurement of lease liabilities for the years ended December 31:


Cash paid for amounts included in the measurement of lease liabilities	2020		2019
Operating cash flows from operating leases	$	2,223	$	2,299
Operating cash flows from finance leases	19		18
Financing cash flows from finance leases	623		534