RED ROBIN GOURMET BURGERS INCRRGB

RED ROBIN GOURMET BURGERS INC Leases Disclosure

10-KFiled Mar 10, 20223 min read
Leases
The Company's finance and operating lease assets and liabilities as of December 26, 2021 and December 27, 2020 as follows (in thousands):
December 26, 2021
Finance(1)
Operating(2)
Lease assets, net(3)
$9,664 $400,825 
Current portion of lease obligations1,194 48,842 
Long-term portion of lease obligations10,765 435,136 
Total$11,959 $483,978 
(1) Finance lease assets and obligations are included in Other assets, net, Accrued liabilities and other current liabilities, and Other non-current liabilities on our December 26, 2021 and December 27, 2020 Consolidated Balance Sheets.
(2) Operating lease assets and obligations are included in Operating lease assets, net, Current portion of operating lease liabilities, and Long-term portion of operating lease liabilities on our December 26, 2021 and December 27, 2020 Consolidated Balance Sheets.
(3) The Lease assets, net caption includes the right of use assets associated with the Company's Finance and Operating leases, net of the associated amortization of these right of use assets.
December 27, 2020
Finance(1)
Operating(2)
Lease assets, net(3)
$9,644 $415,929 
Current portion of lease obligations1,078 54,197 
Long-term portion of lease obligations10,937 454,296 
Total$12,015 $508,493 
(1) Finance lease assets and obligations are included in Other assets, net, Accrued liabilities and other current liabilities, and Other non-current liabilities on our December 26, 2021 and December 27, 2020 Consolidated Balance Sheets.
(2) Operating lease assets and obligations are included in Operating lease assets, net, Current portion of operating lease liabilities, and Long-term portion of operating lease liabilities on our December 26, 2021 and December 27, 2020 Consolidated Balance Sheets.
(3) The Lease assets, net caption includes the right of use assets associated with the Company's Finance and Operating leases, net of the associated amortization of these right of use assets.

The components of lease expense, including variable lease costs primarily consisting of common area maintenance charges and real estate taxes, are included in Occupancy on our consolidated statements of operations and comprehensive loss as follows (in thousands):
Year Ended
December 26, 2021December 27, 2020December 29, 2019
Operating lease cost$70,000 $67,320 $75,496 
Finance lease cost:
Amortization of right of use assets856 845 793 
Interest on lease liabilities (4)
532 534 544 
Total finance lease cost$1,388 $1,379 $1,337 
Variable lease cost19,812 24,482 29,300 
Total lease costs$91,200 $93,181 $106,133 
(4) Interest on finance lease liabilities is recorded to interest expense in our consolidated statements of operations and comprehensive loss.
Maturities of our lease liabilities as of December 26, 2021 were as follows (in thousands):
Finance Leases Operating Leases
2022$1,716 $80,361 
20231,244 76,626 
20241,264 74,898 
20251,283 70,282 
20261,345 64,153 
Thereafter8,169 314,998 
Total future lease liability$15,021 $681,318 
Less imputed interest3,062 197,340 
Present value of lease liability$11,959 $483,978 
Supplemental cash flow information in thousands (except other information) related to leases is as follows:
Year Ended
December 26, 2021December 27, 2020December 29, 2019
Cash flows from operating activities
Cash paid related to lease liabilities
Operating leases$81,520 $47,164 $78,260 
Finance leases532 534 512 
Cash flows from financing activities
Cash paid related to lease liabilities
Finance leases1,733 270 817 
Cash paid for amounts included in the measurement of lease liabilities$83,785 $47,968 $79,589 
Right of use assets obtained in exchange for operating lease obligations$28,738 $56,014 $12,580 
Right of use assets obtained in exchange for finance lease obligations$1,170 $2,918 $1,606 
Other information related to operating leases as follows:
Weighted average remaining lease term9.69 years10.24 years10.70 years
Weighted average discount rate7.05 %6.90 %7.38 %
Other information related to financing leases as follows:
Weighted average remaining lease term10.81 years11.76 years12.37 years
Weighted average discount rate4.56 %4.56 %4.90 %
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Historical Timeline

Fiscal YearFiled
2021Mar 10, 2022Showing above
2020Mar 3, 2021
2019Feb 25, 2020

About Leases Disclosures

Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.

Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.

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