Leases

9 Months Ended

Sep. 26, 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):

		Three Months Ended				Nine Months Ended
	Financial Statement Classification	September 26, 2020		September 28, 2019		September 26, 2020		September 28, 2019
Finance leases:
Amortization expense	SG&A Expense	$	26	$	4	$	64	$	4
Interest expense	Interest expense, net		5		2		15		2
Total finance lease expense			31		6		79		6
Operating leases:
Operating costs	Operating costs		135		427		506		845
Selling, general and administrative expenses	SG&A Expense		459		476		1,364		1,398
Total operating lease expense			594		903		1,870		2,243
Total lease expense		$	625	$	909	$	1,949	$	2,249

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

	Financial Statement Classification	September 26, 2020		December 28, 2019
ROU Assets:
Operating leases	Right of Use asset	$	1,999	$	2,133
Finance leases	Property and equipment, net		471		318
Total ROU Assets:		$	2,470	$	2,451
Lease liabilities:
Current liabilities
Operating leases	Current portion of leases	$	1,494	$	961
Finance leases	Current portion of leases		119		80
Noncurrent Liabilities:
Operating leases	Long-term leases		579		1,220
Finance leases	Long-term leases		353		238
Total lease liabilities		$	2,545	$	2,499

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

	At September 26, 2020
Weighted average remaining lease term (years)
Operating leases		1.4
Finance leases		4.4
Weighted average discount rate
Operating leases		2.0	%
Finance leases		6.2	%

Maturities of lease liabilities as of September 26, 2020 are as follows (dollars in thousands):

Years ending:	Operating leases			Finance leases			Total
2020 (remaining months)		379			33			412
2021		1,448			133			1,581
2022		289			112			401
2023		—			92			92
2024		—			72			72
2025		—			37			37
2026		—			18			18
Total lease payments		2,116			497			2,613
Less: imputed interest		(43	)		(25	)		(68	)
Total lease liabilities	$	2,073		$	472		$	2,545