Kontoor Brands, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

LEASES

LEASES

12 Months Ended

Dec. 28, 2019

The following table presents lease-related assets and liabilities recorded in the Company's balance sheet:



(In thousands)	December 2019
Assets
Operating lease assets, noncurrent	$	86,582
Total lease assets	$	86,582

Liabilities
Operating lease liabilities, current	$	35,389
Operating lease liabilities, noncurrent	54,746
Total lease liabilities	$	90,135

Weighted-average remaining lease term (in years)
Operating leases	3.85
Weighted-average discount rate
Operating leases	3.15		%

Lease costs

The following table presents certain information related to lease costs for operating leases:



(In thousands)	Year Ended December 2019
Operating lease costs	$	37,743
Short-term lease costs (excluding leases of one month or less)	3,043
Variable lease costs	5,300
Total lease costs	$	46,086

Rent expense associated with operating leases for the year ended December 2018 totaled approximately $40.8 million.

Other information

The following table presents supplemental cash flow and non-cash information related to leases:



(In thousands)	Year Ended December 2019
Cash paid for amounts included in the measurement of lease liabilities - operating cash flows	$	46,239
Right-of-use assets obtained in exchange for new operating leases - non-cash activity	$	39,874

The following table presents future maturities of operating lease liabilities as of December 2019:



(In thousands)	Lease Obligations
2020	$	36,711
2021	22,261
2022	11,979
2023	8,938
2024	5,222
Thereafter	6,574
Total future minimum lease payments	91,685
Less: amounts related to imputed interest	(1,550		)
Present value of future minimum lease payments	90,135
Less: operating lease liabilities, current	(35,389		)
Operating lease liabilities, noncurrent	$	54,746

As of December 2019, the Company had entered into approximately $0.6 million of operating lease arrangements, on an undiscounted basis, that had not yet commenced. The Company continuously monitors and may negotiate contract amendments that include extensions or modifications to existing leases.

The following table presents the future minimum lease payments during the noncancelable lease terms as of December 2018, prior to the adoption of ASU 2016-02:



(In thousands)	December 2018
2019	$	33,562
2020	29,246
2021	17,810
2022	7,932
2023	4,353
Thereafter	4,582
Total future minimum lease payments	$	97,485