Leases

3 Months Ended

Mar. 28, 2020

Leases [Abstract]

Leases

The Company leases land, office space and equipment. Arrangements are assessed at inception to determine if a lease exists and, with the adoption of ASC 842, “Leases,” right-of-use (“ROU”) assets and lease liabilities are recognized based on the present value of lease payments over the lease term. Because the Company’s leases do not provide an implicit rate of return, the Company uses its incremental borrowing rate at the inception of a lease to calculate the present value of lease payments. The Company has elected to apply the short-term lease exception for all asset classes, excluding lease liabilities from the balance sheet and recognizing the lease payments in the period they are incurred.

The components of lease expense were as follows (dollars in thousands):

	Financial Statement Classification	Three months ended March 28, 2020		Three months ended March 30, 2019
Finance leases:
Amortization expense	SG&A Expense	$	19	$	—
Interest expense	Interest expense, net		5		—
Total finance lease expense			24		—
Operating leases:
Operating costs	Operating costs		219		213
Selling, general and administrative expenses	SG&A Expense		438		487
Total operating lease expense			657		700
Short-term leases:
Operating costs	Operating costs		—		—
Selling, general and administrative expenses	SG&A Expense		—		119
Total short-term lease expense			—		119
Total lease expense		$	681	$	819

Supplemental balance sheet information related to leases was as follows (dollars in thousands):

	Financial Statement Classification	March 28, 2020		December 28, 2019
ROU Assets:
Operating leases	Right of Use asset	$	2,733	$	2,133
Finance leases	Property and equipment, net		299		318
Total ROU Assets:		$	3,032	$	2,451
Lease liabilities:
Current liabilities
Operating leases	Current portion of leases	$	1,472	$	961
Finance leases	Current portion of leases		81		80
Noncurrent Liabilities:
Operating leases	Long Term Leases		1,318		1,220
Finance leases	Long Term Leases		217		238
Total lease liabilities		$	3,088	$	2,499

The weighted average remaining lease term and weighted average discount rate were as follows:

	At March 28, 2020
Weighted average remaining lease term (years)
Operating leases		2.2
Finance leases		3.8
Weighted average discount rate
Operating leases		2.6	%
Finance leases		10.5	%

Maturities of operating lease liabilities as of March 28, 2020 are as follows (dollars in thousands):

Year ending:		Operating leases			Finance leases			Total
	2020 (remaining months)		1,128			72			1,200
	2021		1,448			96			1,544
	2022		288			75			363
	2023		—			55			55
	2024		—			35			35
	Total lease payments		2,864			333			3,197
	Less: imputed interest		(74	)		(35	)		(109	)
	Total lease liabilities	$	2,790		$	298		$	3,088