Quarterly report pursuant to Section 13 or 15(d)

LEASES

v3.24.1.u1
LEASES
3 Months Ended
Mar. 31, 2024
Leases [Abstract]  
LEASES

5. LEASES

Lessor Arrangements

​

The Company’s lessor arrangements consist of sales-type and direct financing leases for equipment, including vehicles and machinery, with terms ranging from 5 months to 122 months. At March 31, 2024 and December 31, 2023, the carrying value of residual assets covered by residual value guarantees and residual value insurance was $91.5 million and $84.1 million, respectively. For more information on the Company’s lessor arrangements, refer to Note 1 “Summary of Significant Accounting Policies” in the “Notes to the Consolidated Financial Statements” contained in Item 8 “Financial Statements and Supplementary Data” in the Company’s 2023 Form 10-K.

​

Total net investment in sales-type and direct financing leases consists of the following as of the periods ended (dollars in thousands):

​

​

​

​

​

​

​

​

​

​

    

March 31, 2024

​

​

December 31, 2023

Sales-type and direct financing leases:

​

​

​

​

​

​

​

Lease receivables, net of unearned income and deferred selling profit

​

$

451,861

​

​

$

409,264

Unguaranteed residual values, net of unearned income and deferred selling profit

​

​

25,726

​

​

​

21,484

Total net investment in sales-type and direct financing leases

 

$

477,587

​

​

$

430,748

​

Lessee Arrangements

​

The Company’s lessee arrangements consist of operating and finance leases; however, the majority of the leases have been classified as non-cancellable operating leases and are primarily for real estate leases with remaining lease terms of up to 22 years. For more information on the Company’s lessee arrangements, refer to Note 1 “Summary of Significant Accounting Policies” in the “Notes to the Consolidated Financial Statements” contained in Item 8 “Financial Statements and Supplementary Data” in the Company’s 2023 Form 10-K.

​

The tables below provide information about the Company’s lessee lease portfolio and other supplemental lease information for the following periods ended (dollars in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

    

March 31, 2024

​

​

​

December 31, 2023

​

​

​

Operating

​

​

Finance

​

​

​

Operating

​

​

Finance

​

ROU assets

​

$

70,704

​

​

$

4,440

​

​

​

$

71,788

​

​

$

4,669

​

Lease liabilities

​

​

76,140

​

​

​

6,735

​

​

​

​

78,043

​

​

​

7,052

​

Lease Term and Discount Rate of Operating leases:

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Weighted-average remaining lease term (years)

 

​

11.72

​

​

​

4.83

​

​

​

​

11.75

​

​

​

5.08

​

Weighted-average discount rate (1)

 

​

6.25

%

​

​

1.17

%

​

​

​

6.21

%

​

​

1.17

%

(1) A lease implicit rate or an incremental borrowing rate is used based on information available at commencement date of lease or at remeasurement date.

​

​

​

​

​

​

​

​

​

​

Three months ended March 31, 

​

 

2024

​

2023

Cash paid for amounts included in measurement of lease liabilities:

​

​

​

​

​

​

Operating Cash Flows from Finance Leases

​

$

20

​

$

24

Operating Cash Flows from Operating Leases

​

​

3,403

​

​

2,812

Financing Cash Flows from Finance Leases

​

​

317

​

​

306

ROU assets obtained in exchange for lease obligations:

​

​

​

​

​

​

Operating leases

​

$

1,007

​

$

852

​

​

​

​

​

​

​

​

​

​

​

​

​

Three months ended March 31, 

​

​

​

​

2024

​

​

2023

Net Operating Lease Cost

​

 

$

3,102

​

$

2,240

Finance Lease Cost:

​

​

​

​

​

​

​

Amortization of right-of-use assets

​

​

​

230

​

​

230

Interest on lease liabilities

​

​

 

20

​

​

24

Total Lease Cost

​

​

$

3,352

​

$

2,494

​

The maturities of lessor and lessee arrangements outstanding are presented in the table below for the years ending (dollars in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

March 31, 2024

​

​

Lessor

​

Lessee

​

​

​

Sales-type and Direct Financing

​

Operating

​

Finance

For the remaining nine months of 2024

    

$

85,120

​

$

10,009

​

$

1,021

2025

​

​

100,667

​

​

12,670

​

​

1,392

2026

​

 

90,286

​

​

10,142

​

​

1,427

2027

​

 

90,176

​

​

8,776

​

​

1,462

2028

​

 

66,633

​

​

7,831

​

​

1,499

Thereafter

​

 

97,729

​

​

64,120

​

​

127

Total undiscounted cash flows

​

 

530,611

​

​

113,548

​

​

6,928

Less: Adjustments (1)

​

 

78,750

​

​

37,408

​

​

193

Total (2)

​

$

451,861

​

$

76,140

​

$

6,735

(1) Lessor – unearned income and unearned guaranteed residual value; Lessee – imputed interest.

(2) Represents lease receivables for lessor arrangements and lease liabilities for lessee arrangements.