Quarterly report pursuant to Section 13 or 15(d)


3 Months Ended
Mar. 31, 2019


On January 1, 2019, the Company adopted ASU 2016-02, which amended the previous guidance for lease accounting and related disclosure requirements. The new guidance requires the recognition of right-of-use assets and lease liabilities on the balance sheet for leases with terms greater than 12 months or leases that contain a purchase option that is reasonably certain to be exercised. Lessees are required to classify leases as either finance or operating leases. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. 

The Company elected to utilize the package of practical expedients in ASC 842-10-65-1(f) that, upon adoption of ASU 2016-02, allows entities to (1) not reassess whether any expired or existing contracts are or contain leases, (2) retain the classification of leases (e.g., operating or finance lease) existing as of the date of adoption and (3) not reassess initial direct costs for any existing leases.

The Company adopted ASU 2016-02 using the modified retrospective method, and accordingly, the new guidance was applied to leases that existed as of January 1, 2019. This resulted in the recognition of lease liabilities of $8.7 million and right-of-use-assets of $8.5 million on January 1, 2019, which included the impact of eliminating prior year deferred rent. The adoption of ASU 2016-02 did not have a material impact on the Company’s results of operations or cash flows.

The Company primarily leases office space and related equipment, as well as equipment, modular units and vehicles directly used in providing services to our customers. The Company’s leases have remaining lease terms of 1 to 10 years. Most leases contain renewal options for varying periods, which are at the Company’s sole discretion and included in the expected lease term if they are reasonably certain of being exercised.

Right-of-use assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company uses its incremental borrowing rate to determine the present value of the lease as the rate implicit in the lease is typically not readily determinable.

Short-term leases (leases with an initial term of 12 months or less or leases that are cancelable by the lessee and lessor without significant penalties) are not recorded on the condensed consolidated balance sheet and are expensed on a straight-line basis over the lease term. The majority of the Company’s short-term leases relate to equipment used in delivering services to its customers. These leases are entered into at agreed upon hourly, daily, weekly or monthly rental rates for an unspecified duration and typically have a termination for convenience provision. Such equipment leases are considered short-term in nature unless it is reasonably certain that the equipment will be leased for a term greater than 12 months.

The components of lease expense for the three months ended March 31, 2019 were as follows:





Lease Cost/(Sublease Income) (in thousands)


Three Months Ended March 31, 2019

Operating lease cost




Short-term lease cost




Sublease income




Total lease cost




Lease cost related to finance leases were not significant for the three months ended March 31, 2019.

Information related to the Company’s right-of use assets and lease liabilities as of March 31, 2019 was as follows:







Lease Assets/Liabilities (in thousands)


Balance Sheet Classification


March 31, 2019

Lease Assets 






Right-of-use assets


Other long-term assets










Lease Liabilities






Short-term lease liabilities


Other current liabilities




Long-term lease liabilities


Other long-term liabilities




Total lease liabilities







Supplemental information related to the Company’s leases for the three months ended March 31, 2019 was as follows:





(in thousands)


Three Months Ended

March 31, 2019

Cash paid for amounts included in the measurement of lease liabilities:




Operating cash used by operating leases




Right-of-use assets obtained in exchange for new operating lease liabilities




Right-of-use assets obtained in exchange for new finance lease liabilities




Weighted-average remaining lease term - operating leases



2.56 years

Weighted-average remaining lease term - finance leases



5 years

Weighted-average discount rate - operating leases




Weighted-average discount rate - finance leases





Total remaining lease payments under the Company’s operating and finance leases are as follows:










Operating Leases


Finance Leases

Year Ended December 31,


(in thousands)

Remainder of 2019










































Total lease payments







Less: interest







Present value of lease liabilities