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Leases
 3 Months Ended
Mar. 31, 2020
Leases [Abstract]  
Leases Leases
We have a finance lease obligation related to our manufacturing facility in Eschenbach, Germany. Under the terms of the lease agreement, we have an option to purchase the property upon the expiration of the lease in 2021 at a price which is the greater of (i) the then-current market value or (ii) the residual book value of the land including the buildings and installations thereon. Our finance lease obligation related to this facility was $4.4 million and $4.5 million as of March 31, 2020 and December 31, 2019, respectively. The finance lease right-of-use asset balance for this facility was $6.1 million and $6.3 million as of March 31, 2020 and December 31, 2019, respectively. Accumulated amortization related to this finance lease right-of-use asset was $3.8 million and $3.8 million as of March 31, 2020 and December 31, 2019, respectively. The aggregate of all other finance lease obligations, finance lease right-of-use assets and related accumulated amortization, were immaterial as of March 31, 2020 and December 31, 2019.
Amortization expense related to our finance lease right-of-use assets, which is primarily included in the “Cost of sales” line item of the condensed consolidated statements of operations, was immaterial for each of the three-month periods ended March 31, 2020 and 2019. Interest expense related to our finance lease obligations, which is included in the “Interest expense, net” line item of the condensed consolidated statements of operations, was immaterial for each of the three-month periods ended March 31, 2020 and 2019. Payments made on the principal portion of our finance lease obligations were immaterial for each of the three-month periods ended March 31, 2020 and 2019.
We have operating leases primarily related to building space and vehicles. Renewal options are included in the lease term to the extent we are reasonably certain to exercise the option. The exercise of lease renewal options is at our sole discretion. We account for lease components separately from non-lease components. The incremental borrowing rate represents our ability to borrow on a collateralized basis over a similar lease term.
Our expenses and payments for operating leases were as follows:
Three Months Ended
(Dollars in thousands)March 31, 2020March 31, 2019
Operating leases expense$728  $718  
Short-term leases expense$123  $39  
Payments on operating lease obligations$746  $764  
Our assets and liabilities balances related to finance and operating leases reflected in the condensed consolidated statements of financial position were as follows:
(Dollars in thousands)Location in Statements of Financial PositionMarch 31, 2020December 31, 2019
Finance lease right-of-use assetsProperty, plant and equipment, net$6,079  $6,280  
Operating lease right-of-use assetsOther long-term assets$5,072  $4,656  
Finance lease obligations, current portionOther accrued liabilities$396  $400  
Finance lease obligations, non-current portionOther long-term liabilities$3,963  $4,140  
Total finance lease obligations$4,359  $4,540  
Operating lease obligations, current portionOther accrued liabilities$2,401  $2,343  
Operating lease obligations, non-current portionOther long-term liabilities$2,693  $2,334  
Total operating lease obligations$5,094  $4,677  
Net Future Minimum Lease Payments
The following table includes future minimum lease payments under finance and operating leases together with the present value of the net future minimum lease payments as of March 31, 2020:
FinanceOperating
(Dollars in thousands)LeasesLeases SignedLess: Leases Not Yet CommencedLeases
2020$394  $2,013  $—  $2,013  
20214,121  1,867  —  1,867  
2022—  968  —  968  
2023—  390  —  390  
2024—  185  —  185  
Thereafter—  5  —  5  
Total lease payments4,515  5,428  —  5,428  
Less: Interest(156) (334) —  (334) 
Present Value of Net Future Minimum Lease Payments$4,359  $5,094  $—  $5,094  
The following table includes information regarding the lease term and discount rates utilized in the calculation of the present value of net future minimum lease payments:
Finance
Leases		Operating
Leases
Weighted Average Remaining Lease Term1.3 years2.6 years
Weighted Average Discount Rate3.00%5.13%
Leases Leases
We have a finance lease obligation related to our manufacturing facility in Eschenbach, Germany. Under the terms of the lease agreement, we have an option to purchase the property upon the expiration of the lease in 2021 at a price which is the greater of (i) the then-current market value or (ii) the residual book value of the land including the buildings and installations thereon. Our finance lease obligation related to this facility was $4.4 million and $4.5 million as of March 31, 2020 and December 31, 2019, respectively. The finance lease right-of-use asset balance for this facility was $6.1 million and $6.3 million as of March 31, 2020 and December 31, 2019, respectively. Accumulated amortization related to this finance lease right-of-use asset was $3.8 million and $3.8 million as of March 31, 2020 and December 31, 2019, respectively. The aggregate of all other finance lease obligations, finance lease right-of-use assets and related accumulated amortization, were immaterial as of March 31, 2020 and December 31, 2019.
Amortization expense related to our finance lease right-of-use assets, which is primarily included in the “Cost of sales” line item of the condensed consolidated statements of operations, was immaterial for each of the three-month periods ended March 31, 2020 and 2019. Interest expense related to our finance lease obligations, which is included in the “Interest expense, net” line item of the condensed consolidated statements of operations, was immaterial for each of the three-month periods ended March 31, 2020 and 2019. Payments made on the principal portion of our finance lease obligations were immaterial for each of the three-month periods ended March 31, 2020 and 2019.
We have operating leases primarily related to building space and vehicles. Renewal options are included in the lease term to the extent we are reasonably certain to exercise the option. The exercise of lease renewal options is at our sole discretion. We account for lease components separately from non-lease components. The incremental borrowing rate represents our ability to borrow on a collateralized basis over a similar lease term.
Our expenses and payments for operating leases were as follows:
Three Months Ended
(Dollars in thousands)March 31, 2020March 31, 2019
Operating leases expense$728  $718  
Short-term leases expense$123  $39  
Payments on operating lease obligations$746  $764  
Our assets and liabilities balances related to finance and operating leases reflected in the condensed consolidated statements of financial position were as follows:
(Dollars in thousands)Location in Statements of Financial PositionMarch 31, 2020December 31, 2019
Finance lease right-of-use assetsProperty, plant and equipment, net$6,079  $6,280  
Operating lease right-of-use assetsOther long-term assets$5,072  $4,656  
Finance lease obligations, current portionOther accrued liabilities$396  $400  
Finance lease obligations, non-current portionOther long-term liabilities$3,963  $4,140  
Total finance lease obligations$4,359  $4,540  
Operating lease obligations, current portionOther accrued liabilities$2,401  $2,343  
Operating lease obligations, non-current portionOther long-term liabilities$2,693  $2,334  
Total operating lease obligations$5,094  $4,677  
Net Future Minimum Lease Payments
The following table includes future minimum lease payments under finance and operating leases together with the present value of the net future minimum lease payments as of March 31, 2020:
FinanceOperating
(Dollars in thousands)LeasesLeases SignedLess: Leases Not Yet CommencedLeases
2020$394  $2,013  $—  $2,013  
20214,121  1,867  —  1,867  
2022—  968  —  968  
2023—  390  —  390  
2024—  185  —  185  
Thereafter—  5  —  5  
Total lease payments4,515  5,428  —  5,428  
Less: Interest(156) (334) —  (334) 
Present Value of Net Future Minimum Lease Payments$4,359  $5,094  $—  $5,094  
The following table includes information regarding the lease term and discount rates utilized in the calculation of the present value of net future minimum lease payments:
Finance
Leases		Operating
Leases
Weighted Average Remaining Lease Term1.3 years2.6 years
Weighted Average Discount Rate3.00%5.13%