Quarterly report pursuant to Section 13 or 15(d)

Leases

v3.23.2
Leases
 6 Months Ended
Jul. 03, 2023
Leases [Abstract]  
Leases Leases
The Company has entered into various lease agreements and these agreements expire on various dates through 2032 and have renewal options.

The components of lease expense for the periods shown is as follows:

Quarter Ended Six Months Ended
(in thousands) Classification July 3, 2023 June 30, 2022 July 3, 2023 June 30, 2022
Operating lease cost Occupancy and related expenses
Pre-opening costs
Store closure costs		 $ 3,218  $ 3,097  $ 6,463  $ 6,348 
Finance lease cost:
   Amortization of right-of-use assets Depreciation and amortization expense 55  82  113  134 
   Interest on lease liabilities Interest expense 13  19  27  31 
Less: Sublease income Occupancy and related expenses (47) (47) (94) (94)
Total lease cost $ 3,239  $ 3,151  $ 6,509  $ 6,419 

The maturity of the Company's operating and finance lease liabilities as of July 3, 2023 is as follows:

(in thousands) Operating Leases Finance Leases
One Year $ 12,274  $ 142 
Two Years 12,154  182 
Three Years 11,687  167 
Four Years 9,804  158 
Five Years 8,173  152 
Thereafter 10,217  208 
Total undiscounted lease payments 64,309  1,009 
Less: present value adjustment (11,146) (158)
Total net lease liabilities $ 53,163  $ 851 

As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company gives consideration to its recent debt issuances as well as publicly available data for instruments with similar characteristics when calculating its incremental borrowing rates.

A summary of lease terms and discount rates for finance and operating leases is as follows:

July 3, 2023 June 30, 2022
Weighted-average remaining lease term (in years)
Operating leases 5.8 6.4
Finance leases 5.9 6.6
Weighted-average discount rate
Operating leases 7.1  % 6.0  %
Finance leases 6.0  % 6.0  %
Leases Leases
The Company has entered into various lease agreements and these agreements expire on various dates through 2032 and have renewal options.

The components of lease expense for the periods shown is as follows:

Quarter Ended Six Months Ended
(in thousands) Classification July 3, 2023 June 30, 2022 July 3, 2023 June 30, 2022
Operating lease cost Occupancy and related expenses
Pre-opening costs
Store closure costs		 $ 3,218  $ 3,097  $ 6,463  $ 6,348 
Finance lease cost:
   Amortization of right-of-use assets Depreciation and amortization expense 55  82  113  134 
   Interest on lease liabilities Interest expense 13  19  27  31 
Less: Sublease income Occupancy and related expenses (47) (47) (94) (94)
Total lease cost $ 3,239  $ 3,151  $ 6,509  $ 6,419 

The maturity of the Company's operating and finance lease liabilities as of July 3, 2023 is as follows:

(in thousands) Operating Leases Finance Leases
One Year $ 12,274  $ 142 
Two Years 12,154  182 
Three Years 11,687  167 
Four Years 9,804  158 
Five Years 8,173  152 
Thereafter 10,217  208 
Total undiscounted lease payments 64,309  1,009 
Less: present value adjustment (11,146) (158)
Total net lease liabilities $ 53,163  $ 851 

As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company gives consideration to its recent debt issuances as well as publicly available data for instruments with similar characteristics when calculating its incremental borrowing rates.

A summary of lease terms and discount rates for finance and operating leases is as follows:

July 3, 2023 June 30, 2022
Weighted-average remaining lease term (in years)
Operating leases 5.8 6.4
Finance leases 5.9 6.6
Weighted-average discount rate
Operating leases 7.1  % 6.0  %
Finance leases 6.0  % 6.0  %