| 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 (amounts in thousands):
| | |
Financial Statement Classification | |
Year ended December 26, 2020 | |
Year ended December 28, 2019 |
| Finance leases: | |
| |
| | | |
| | |
| Amortization expense | |
SG&A Expense | |
$ | 92 | | |
$ | 33 | |
| Interest expense | |
Interest expense, net | |
| 20 | | |
| 7 | |
| | |
| |
$ | 112 | | |
$ | 40 | |
| Operating leases: | |
| |
| | | |
| | |
| Operating costs | |
Operating costs | |
| 633 | | |
| 1,214 | |
| Selling, general and administrative expenses | |
SG&A Expense | |
| 1,830 | | |
| 1,857 | |
| | |
| |
$ | 2,463 | | |
$ | 3,071 | |
| Total lease expense | |
| |
$ | 2,575 | | |
$ | 3,111 | |
Supplemental balance sheet
information related to leases was as follows (amounts in thousands):
| | |
Financial Statement Classification | |
December 26, 2020 | |
December 28, 2019 |
| ROU Assets: | |
| |
| | | |
| | |
| Operating leases | |
Right of Use asset | |
$ | 1,628 | | |
$ | 2,133 | |
| Finance leases | |
Property and equipment, net | |
| 442 | | |
| 318 | |
| Total ROU Assets: | |
| |
$ | 2,070 | | |
$ | 2,451 | |
| | |
| |
| | | |
| | |
| Lease liabilities: | |
| |
| | | |
| | |
| Current liabilities | |
| |
| | | |
| | |
| Operating leases | |
Current portion of leases | |
$ | 1,421 | | |
$ | 961 | |
| Finance leases | |
Current portion of leases | |
| 120 | | |
| 80 | |
| Noncurrent Liabilities: | |
| |
| | | |
| | |
| Operating leases | |
Long Term Leases | |
| 286 | | |
| 1,220 | |
| Finance leases | |
Long Term Leases | |
| 322 | | |
| 238 | |
| Total lease liabilities | |
| |
$ | 2,149 | | |
$ | 2,499 | |
The weighted average remaining
lease term and weighted average discount rate were as follows:
| | |
December 26, 2020 | |
December 28, 2019 |
| Weighted average remaining lease term (years) | |
| | | |
| | |
| Operating leases | |
| 1.2 | | |
| 2.2 | |
| Finance leases | |
| 4.2 | | |
| 3.3 | |
| Weighted average discount rate | |
| | | |
| | |
| Operating leases | |
| 1.7 | % | |
| 3.3 | % |
| Finance leases | |
| 5.8 | % | |
| 11.0 | % |
Maturities of operating
lease liabilities as of December 26, 2020 are as follows (dollars in thousands):
| Years ending: | |
Operating leases | |
Finance leases | |
Total |
| | 2021 | | |
| 1,448 | | |
| 133 | | |
| 1,581 | |
| | 2022 | | |
| 288 | | |
| 113 | | |
| 401 | |
| | 2023 | | |
| — | | |
| 93 | | |
| 93 | |
| | 2024 | | |
| — | | |
| 73 | | |
| 73 | |
| | 2025 and thereafter | | |
| — | | |
| 57 | | |
| 57 | |
| | Total lease payments | | |
| 1,736 | | |
| 469 | | |
| 2,205 | |
| | Less: imputed interest | | |
| (29 | ) | |
| (27 | ) | |
| (56 | ) |
| | Total lease liabilities | | |
$ | 1,707 | | |
$ | 442 | | |
$ | 2,149 | |
|