Quarterly report pursuant to Section 13 or 15(d)

Operating and Finance Lease Right-of-Use Assets

v3.22.1
Operating and Finance Lease Right-of-Use Assets
 3 Months Ended
Mar. 31, 2022
Leases [Abstract]  
Operating and Finance Lease Right-of-Use Assets
NOTE 7. OPERATING AND FINANCE LEASE
RIGHT-OF-USE
ASSETS
Leases
We account for leases in accordance with ASC 842, “
Leases
” that requires lessees to recognize Right of Use (“ROU”) assets and lease liabilities calculated based on the present value of lease payments for all lease agreements with terms that are greater than twelve months. ASC 842 distinguishes leases as either a finance lease or an operating lease that affects how the leases are measured and presented in the statement of operations and statement of cash flows.
Leasing Transactions
Our leased assets include offices and studios, transmitter locations, antenna sites, tower and tower sites, and land. Our lease portfolio has terms remaining from less than
one-year
to up to twenty years. Many of these leases contain options under which we can extend the term from five to twenty years. Renewal options are excluded from our calculation of lease liabilities unless we are reasonably assured to exercise the renewal option. Our lease agreements do not contain residual value guarantees or material restrictive covenants. We lease certain properties from our principal stockholders or from trusts and partnerships created for the benefit of the principal stockholders and their families. These leases are designated as Related Party leases in the details provided.
Operating leases are reflected on our balance sheet within operating lease ROU assets and the related current and
non-current
operating lease liabilities. ROU assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from lease agreement. Operating lease ROU assets and liabilities are recognized at the commencement date, or the date on which the lessor makes the underlying asset available for use, based upon the present value of the lease payments over the respective lease term. As the implicit rate for operating leases is not readily determinable, the future minimum lease payments were discounted using an incremental borrowing rate. Lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectation regarding the lease terms. Variable lease costs, such as common area maintenance, property taxes, and insurance, are expensed as incurred.
Balance Sheet
Supplemental balance sheet information related to leases is as follows:
                         
    
March 31, 2022
  
    
(Dollars in thousands)
  
Operating Leases
    Related Party      Other      Total  
Operating leases ROU assets
    $ 7,142      $ 38,741      $ 45,883  
Operating lease liabilities (current)
    $ 976      $ 7,839      $ 8,815  
Operating lease liabilities
(non-current)
      6,266        38,449        44,715  
    
 
 
     
 
 
     
 
 
  
Total operating lease liabilities
    $ 7,242      $ 46,288      $ 53,530  
    
 
 
     
 
 
     
 
 
  
         
Weighted Average Remaining Lease Term
         
Operating leases
      7.7 years  
Finance leases
      2.8 years  
Weighted Average Discount Rate
         
Operating leases
      8.09 % 
Finance leases
      6.11 % 
Lease Expense
The components of lease expense were as follows:
         
    
Three Months Ended
March 31, 2022
  
    
(Dollars in thousands)
  
Amortization of finance lease ROU Assets
    $ 15  
Interest on finance lease liabilities
      2  
    
 
 
  
Finance lease expense
      17  
Operating lease expense
      3,224  
Variable lease expense
      268  
Short-term lease expense
      158  
    
 
 
  
Total lease expense
    $ 3,667  
    
 
 
  
Supplemental Cash Flow
Supplemental cash flow information related to leases was as follows:
         
    
Three Months Ended
March 31, 2022
  
    
(Dollars in thousands)
  
Cash paid for amounts included in the measurement of lease liabilities:
         
Operating cash flows from operating leases
    $ 2,849  
Operating cash flows from finance leases
      1  
Financing cash flows from finance leases
      16  
Leased assets obtained in exchange for new operating lease liabilities
    $ 5,011  
Leased assets obtained in exchange for new finance lease liabilities
      14  
Maturities
Future minimum lease payments under leases that had initial or remaining
non-cancelable
lease terms in excess of one year as of March 31, 2022, are as follows:
                                         
Future minimum lease    Operating Leases              
     Related Party     Other     Total     Finance Leases     Total  
    
(Dollars in thousands)
  
2023
(Apr-Dec)
    $ 1,565     $ 11,378     $ 12,943     $ 64     $ 13,007  
2024
      1,305       10,658       11,963       36       11,999  
2025
      1,307       8,719       10,026       17       10,043  
2026
      1,341       7,526       8,867       10       8,877  
2027
      1,063       5,394       6,457       5       6,462  
Thereafter
      3,955       22,635       26,590       1       26,591  
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Undiscounted Cash Flows
    $ 10,536     $ 66,310     $ 76,846     $ 133     $ 76,979  
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Less: imputed interest
      (3,294 )      (20,022 )      (23,316 )      (12 )      (23,328 ) 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Total
   
$
7,242
 
  
$
46,288
 
  
$
53,530
 
  
$
121
 
  
$
53,651
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Reconciliation to lease liabilities:
                                         
Lease liabilities—current
    $ 976     $ 7,839     $ 8,815     $ 59     $ 8,874  
Lease liabilities—long-term
      6,266       38,449       44,715       62       44,777  
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Total Lease Liabilities
   
$
7,242
 
  
$
46,288
 
  
$
53,530
 
  
$
121
 
  
$
53,651