V2X, Inc. - 10-Q filing on 2019-05-07

Leases

3 Months Ended

Mar. 29, 2019

We determine whether an arrangement contains a lease at inception. We have operating leases for office space, apartments, vehicles, and machinery and equipment. Our operating leases have lease terms of less than one year to ten years.

We do not separate lease components (e.g., fixed payments for rent) from non-lease components (e.g., common area maintenance) but account for the non-lease components and non-components (e.g., property taxes and insurance) in a contract as part of the single lease component to which they are related.

The components of lease expense are as follows:



	Three Months Ended
(In thousands)	March 29, 2019
Operating lease expense	$	3,416
Variable lease expense	173
Short-term lease expense	11,197
Total lease expense	$	14,786

Supplemental balance sheet information related to our operating leases is as follows:



	March 29,
(In thousands)	2019
Right-of-use assets	$	19,627

Current lease liabilities (recorded in other accrued liabilities)	$	12,282
Long-term lease liabilities (recorded in other non-current liabilities)	8,027
Total operating lease liabilities	$	20,309

Initial ROU assets of $19.2 million were recognized as non-cash asset additions with the adoption of the new lease accounting standard. Additional ROU assets of $3.5 million were recognized as non-cash asset additions that resulted from new operating lease liabilities during the first quarter of 2019.

The weighted average remaining lease term and discount rate for our operating leases at March 29, 2019 were 3.6 years and 5.9%, respectively.

Maturities of lease liabilities at March 29, 2019 were as follows:



(In thousands)
Year ending December 31,
2019 (excluding the three months ended March 29, 2019)	$	13,063
2020	3,158
2021	1,250
2022	864
2023	886
2024 and beyond	4,187
Total lease payments	$	23,408
Less: Imputed interest	3,099
Total	$	20,309