Annual report pursuant to Section 13 and 15(d)

Leases

v3.20.1
Leases
12 Months Ended
Mar. 31, 2020
Leases [Abstract]  
Leases Leases
The Company’s operating leases are primarily for sales and administrative offices and manufacturing facilities. These operating leases have lease periods expiring between 2020 and 2061. The Company’s finance leases are primarily for vehicles and certain network equipment. These leases expire between 2020 and 2029.
Many leases require the Company to pay certain executory costs (taxes, insurance, and maintenance) and contain renewal and purchase options. The Company does not assume renewals in the determination of the lease term unless renewals are deemed to be reasonably assured at lease commencement. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The components of lease expense for the fiscal year ended March 31, 2020 are as follows (amounts in thousands):
 
Fiscal Year Ended March 31, 2020
Operating lease expense
 
Operating lease cost
$
12,033

Variable lease cost and other, net (1)
1,205

Short-term lease cost
31

Sublease income
(79
)
Finance lease expense
 
Amortization of right-of-use assets
1,323

Interest
152

Total lease expense
$
14,665

______________________________________________________________________________
(1) Predominantly includes common area maintenance and parking expenses.
Supplemental balance sheet information related to operating and finance leases as of March 31, 2020 is as follows (amounts in thousands, except lease term and discount rate):
 
Balance Sheet Location
 
March 31, 2020
Lease assets
 
 
 
Operating lease ROU assets
Other assets
 
$
29,732

Finance lease ROU assets (1)
Property, plant and equipment, net of accumulated depreciation
 
3,008

 
 
 
$
32,740

 
 
 
 
Lease liabilities
 
 
 
Current operating lease liabilities
Accrued expenses
 
$
7,715

Current finance lease liabilities
Accrued expenses
 
1,245

Non-current operating lease liabilities
Other non-current obligations
 
22,338

Non-current finance lease liabilities
Other non-current obligations
 
1,770

 
 
 
$
33,068

 
 
 
 
Weighted average remaining lease term (years)
 
 
 
Operating leases
 
 
6.11

Finance leases
 
 
2.98

 
 
 
 
Weighted average discount rate
 
 
 
Operating leases
 
 
4.77
%
Finance leases
 
 
5.51
%
______________________________________________________________________________
(1) Finance lease ROU assets are shown net of accumulated depreciation of 3.2 million.
Supplemental cash flow information related to leases for the fiscal year ended March 31, 2020 is as follows (amounts in thousands):
 
Fiscal Year Ended March 31, 2020
Cash paid for amounts included in the measurement of lease liabilities
 
Operating cash flows used for operating leases
$
12,126

Operating cash flows used for finance leases
148

Financing cash flows used for finance leases
1,447

 
$
13,721

 
 
Lease liabilities arising from obtaining ROU assets
 
Operating leases
$
4,731

Finance leases
2,061

 
$
6,792


A maturity analysis of the future undiscounted cash flows associated with the Company's operating and finance lease liabilities as of March 31, 2020 were as follows (amounts in thousands):
 
Operating Lease Liabilities
 
Finance Lease Liabilities
2021
$
8,921

 
$
1,376

2022
6,203

 
945

2023
4,711

 
597

2024
3,906

 
171

2025
2,652

 
31

Thereafter
9,318

 
75

Total undiscounted cash flows
$
35,711

 
$
3,195

Less imputed interest
(5,658
)
 
(180
)
Present value of lease liabilities
$
30,053

 
$
3,015


Annual rental expenses for operating leases included in results of operations were $13.3 million and $10.7 million in fiscal years 2019 and 2018, respectively.
Leases Leases
The Company’s operating leases are primarily for sales and administrative offices and manufacturing facilities. These operating leases have lease periods expiring between 2020 and 2061. The Company’s finance leases are primarily for vehicles and certain network equipment. These leases expire between 2020 and 2029.
Many leases require the Company to pay certain executory costs (taxes, insurance, and maintenance) and contain renewal and purchase options. The Company does not assume renewals in the determination of the lease term unless renewals are deemed to be reasonably assured at lease commencement. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The components of lease expense for the fiscal year ended March 31, 2020 are as follows (amounts in thousands):
 
Fiscal Year Ended March 31, 2020
Operating lease expense
 
Operating lease cost
$
12,033

Variable lease cost and other, net (1)
1,205

Short-term lease cost
31

Sublease income
(79
)
Finance lease expense
 
Amortization of right-of-use assets
1,323

Interest
152

Total lease expense
$
14,665

______________________________________________________________________________
(1) Predominantly includes common area maintenance and parking expenses.
Supplemental balance sheet information related to operating and finance leases as of March 31, 2020 is as follows (amounts in thousands, except lease term and discount rate):
 
Balance Sheet Location
 
March 31, 2020
Lease assets
 
 
 
Operating lease ROU assets
Other assets
 
$
29,732

Finance lease ROU assets (1)
Property, plant and equipment, net of accumulated depreciation
 
3,008

 
 
 
$
32,740

 
 
 
 
Lease liabilities
 
 
 
Current operating lease liabilities
Accrued expenses
 
$
7,715

Current finance lease liabilities
Accrued expenses
 
1,245

Non-current operating lease liabilities
Other non-current obligations
 
22,338

Non-current finance lease liabilities
Other non-current obligations
 
1,770

 
 
 
$
33,068

 
 
 
 
Weighted average remaining lease term (years)
 
 
 
Operating leases
 
 
6.11

Finance leases
 
 
2.98

 
 
 
 
Weighted average discount rate
 
 
 
Operating leases
 
 
4.77
%
Finance leases
 
 
5.51
%
______________________________________________________________________________
(1) Finance lease ROU assets are shown net of accumulated depreciation of 3.2 million.
Supplemental cash flow information related to leases for the fiscal year ended March 31, 2020 is as follows (amounts in thousands):
 
Fiscal Year Ended March 31, 2020
Cash paid for amounts included in the measurement of lease liabilities
 
Operating cash flows used for operating leases
$
12,126

Operating cash flows used for finance leases
148

Financing cash flows used for finance leases
1,447

 
$
13,721

 
 
Lease liabilities arising from obtaining ROU assets
 
Operating leases
$
4,731

Finance leases
2,061

 
$
6,792


A maturity analysis of the future undiscounted cash flows associated with the Company's operating and finance lease liabilities as of March 31, 2020 were as follows (amounts in thousands):
 
Operating Lease Liabilities
 
Finance Lease Liabilities
2021
$
8,921

 
$
1,376

2022
6,203

 
945

2023
4,711

 
597

2024
3,906

 
171

2025
2,652

 
31

Thereafter
9,318

 
75

Total undiscounted cash flows
$
35,711

 
$
3,195

Less imputed interest
(5,658
)
 
(180
)
Present value of lease liabilities
$
30,053

 
$
3,015