Leases (Notes)

6 Months Ended

Jul. 31, 2019

Leases [Abstract]

Leases of Lessee Disclosure [Text Block]

LEASES

The Company enters into operating and finance lease contracts related to facilities, vehicles and equipment. Operating leases are primarily related to facilities to support production, research and development, and sales efforts. Finance leases are primarily related to vehicles and equipment to support general business operations. Lease payments are typically fixed and carry lease terms of one to six years, some of which have an option to terminate or extend up to an additional ten years. For purposes of the quantitative disclosures below related to the calculation of operating and finance leases, lease terms did not include options to terminate or extend, as the Company is reasonably certain it would not exercise the options. Most of the Company's leases do not contain a purchase option, material residual value guarantee, or material restrictive covenants.

The Company is primarily a lessee in all lease arrangements but may become a lessor and lease or sublease certain assets to other entities if not fully utilized. These lessor activities are not material and are not separately disclosed.

To determine whether a contract is or contains a lease, the Company assessed its right to control the use of the identified asset, whether explicitly or implicitly stated, for a period of time while considering all facts and circumstances for each individual arrangement. The Company also has leases with non-lease components which are separately stated within the agreement and not included in the recognition of the right-of use asset and lease liability balances.

The discount rate used to calculate the present value of the lease liabilities is based upon the implied rate within each contract. If the rate is unknown or cannot be determined, the Company uses an incremental borrowing rate, which is determined by the length of the contract, asset class, and the Company's borrowing rates as of the commencement date of the contract.

Components of Company lease costs, including operating, finance, and short-term leases are included in the table below. Depreciation of right-of-use assets, operating leases cost, and short-term lease costs are reported in net income as "Cost of sales," "Research and development expenses," or "Selling, general, and administrative expenses," depending on what business function the asset primarily supports. Interest on lease liabilities are classified as a non-operating expense in "Other income (expense), net" on the Consolidated Statements of Income and Comprehensive Income.

	Three Months Ended July 31, 2019		Six Months Ended July 31, 2019
Lease Costs:
Finance Leases
Depreciation of right-of-use assets	$	104	$	199
Interest on lease liabilities	6		11
Total finance lease cost	$	110	$	210
Operating Leases
Operating lease cost	$	362	$	722
Short-term lease cost	101		206
Total operating lease cost	$	463	$	928
Total finance and operating lease cost	$	573	$	1,138

Supplemental unaudited balance sheet information related to operating and finance leases include:

	July 31, 2019
Operating Leases
Operating lease right-of-use assets	$	3,121
Current lease liability	$	1,721
Non-current lease liability	1,951
Total operating lease liabilities	$	3,672
Finance Leases
Property, plant and equipment, at cost	$	873
Accumulated depreciation	(180		)
Property, plant and equipment, net	$	693
Current lease liability	$	343
Non-current lease liability	350
Total finance lease liabilities	$	693

Weighted average remaining lease terms and discount rates include:

	July 31, 2019
Weighted Average Remaining Lease Term:
Operating leases	3 years
Finance leases	2 years
Weighted Average Discount Rate:
Operating leases	3.5	%
Finance leases	3.5	%

Supplemental unaudited cash flow information related to operating and finance leases include:

	Three Months Ended July 31, 2019		Six Months Ended July 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	362	$	722
Operating cash flows from finance leases	6		11
Financing cash flows from finance leases	104		199
Right-of-use assets obtained in exchange for lease obligations:
Finance leases	$	208	$	398
Operating leases	—		—

Future operating and finance lease obligations that have not yet commenced as of July 31, 2019, were immaterial and excluded from the lease liability schedule below accordingly.

	July 31, 2019
	Operating Leases			Finance Leases
Remainder of Fiscal 2020	$	902		$	215
Fiscal 2021	1,850			243
Fiscal 2022	680			160
Fiscal 2023	316			84
Fiscal 2024	98			21
Thereafter	—			—
Total lease payments	$	3,846		$	723
Less imputed interest	(174		)	(30		)
Total lease liabilities	$	3,672		$	693

Prior to the Company's adoption of ASU 2016-02 in the first quarter of fiscal year 2020, future minimum lease payments reported in the Company’s Annual Report on Form 10-K for the year ended January 31, 2019, were as follows:

	January 31, 2019
	Operating Leases		Capital Leases
Fiscal 2020	$	2,213	$	182
Fiscal 2021	1,939		102
Fiscal 2022	728		44
Fiscal 2023	356		2
Fiscal 2024	140		—
Thereafter	—		—
Total lease payments	$	5,376	$	330
Less amount representing estimated executory costs such as taxes, license and insurance including profit thereon.			(14		)
Less amounts representing interest			(32		)
Present value of net minimum lease payments			$	284