Quarterly report pursuant to Section 13 or 15(d)

Operating Leases (Notes)

v3.19.3
Operating Leases (Notes)
9 Months Ended
Sep. 30, 2019
Operating Leases [Abstract]  
Operating Leases
5. OPERATING LEASES
Lessee. As of September 30, 2019, the Company leased in two U.S.-flag petroleum and chemical carriers, five U.S.-flag harbor tugs, four U.S.-flag PCTCs, 50 inland river dry-cargo barges, four inland river towboats, six inland river harbor boats and certain facilities and other equipment. The leases generally contain purchase and renewal options or rights of first refusal with respect to the sale or lease of the equipment. As of September 30, 2019, the lease terms of the U.S.-flag petroleum and chemical carriers, which are subject to subleases, have remaining durations of 36 and 83 months. The lease terms of the other vessels, facilities and equipment range in duration from 3 to 198 months.
As of September 30, 2019, future minimum payments for operating leases for the remainder of 2019 and the years ended December 31 were as follows (in thousands):
Remainder of 2019 $ 10,891   
2020 41,837   
2021 37,649   
2022 27,453   
2023 15,524   
Years subsequent to 2023 40,623   
173,977   
Interest component (20,689)  
153,288   
Current portion of long-term operating lease liabilities (36,422)  
Long-term operating lease liabilities $ 116,866   
For the nine months ended September 30, 2019, the components of lease expense were as follows (in thousands):
Operating lease expense $ 32,009   
Short-term lease expense (lease duration of twelve months or less at lease commencement) 17,136   
Sublease income (24,129)  
$ 25,016   
For the nine months ended September 30, 2019, other information related to operating leases was as follows (in thousands except weighted average data):
Operating cash outflows from operating leases $ 32,185   
Right-of-use assets obtained in exchange for operating lease liabilities $ 179,746   
Weighted average remaining lease term, in years 5.4
Weighted average discount rate 4.8  %
Lessor. As of September 30, 2019, lessor arrangements with remaining terms in excess of one year included the bareboat charter of three U.S.-flag petroleum and chemical carriers, five U.S.-flag ocean liquid tank barges and six foreign-flag harbor tugs, the time charter of four U.S.-flag petroleum and chemical carriers, four U.S.-flag PCTCs, seven inland river towboats and one U.S.-flag offshore tug, and other non-vessel rental arrangements of certain property and equipment. As of September 30, 2019, future minimum lease revenues from these arrangements for the remainder of 2019 and in the years ended December 31 were as follows (in thousands):
Total Minimum Lease Revenues
Leased-in Obligations(1)
Net Minimum Lease Income
Remainder of 2019 $ 33,817    $ (7,995)   $ 25,822   
2020 142,748    (31,595)   111,153   
2021 108,740    (29,590)   79,150   
2022 54,374    (22,812)   31,562   
2023 34,701    (11,315)   23,386   
Years subsequent to 2023 87,375    (29,884)   57,491   
____________________
(1)The total payments to be made under existing non-cancelable leases for the property and equipment subject to these future minimum lease revenues.
As of September 30, 2019, the major classes of owned property and equipment earning lease revenues were as follows (in thousands):
Historical
Cost
Accumulated
Depreciation
Net Book
Value
Ocean Services:
Petroleum and chemical carriers - U.S.-flag $ 471,049    $ (196,317)   $ 274,732   
Harbor and offshore tugs - U.S.-flag & foreign-flag 51,129    (16,696)   34,433   
Ocean liquid tank barges - U.S.-flag 38,097    (14,649)   23,448   
560,275    (227,662)   332,613   
Inland Services:
Towboats 36,236    (3,086)   33,150   
$ 596,511    $ (230,748)   $ 365,763