Company Quick10K Filing
Alamo Group
Price117.76 EPS6
Shares12 P/E20
MCap1,391 P/FCF31
Net Debt90 EBIT93
TEV1,481 TEV/EBIT16
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-03-31 Filed 2020-05-07
10-K 2019-12-31 Filed 2020-02-28
10-Q 2019-09-30 Filed 2019-10-31
10-Q 2019-06-30 Filed 2019-07-31
10-Q 2019-03-31 Filed 2019-05-01
10-K 2018-12-31 Filed 2019-03-01
10-Q 2018-09-30 Filed 2018-10-31
10-Q 2018-06-30 Filed 2018-08-01
10-Q 2018-03-31 Filed 2018-05-03
10-K 2017-12-31 Filed 2018-03-01
10-Q 2017-09-30 Filed 2017-10-31
10-Q 2017-06-30 Filed 2017-08-02
10-Q 2017-03-31 Filed 2017-05-04
10-K 2016-12-31 Filed 2017-03-07
10-Q 2016-09-30 Filed 2016-11-04
10-Q 2016-06-30 Filed 2016-08-05
10-Q 2016-03-31 Filed 2016-05-06
10-K 2015-12-31 Filed 2016-03-04
10-Q 2015-09-30 Filed 2015-11-06
10-Q 2015-06-30 Filed 2015-08-07
10-Q 2015-03-31 Filed 2015-05-08
10-K 2014-12-31 Filed 2015-03-06
10-Q 2014-09-30 Filed 2014-11-06
10-Q 2014-06-30 Filed 2014-08-08
10-Q 2014-03-31 Filed 2014-05-08
10-K 2013-12-31 Filed 2014-03-11
10-Q 2013-09-30 Filed 2013-11-08
10-Q 2013-06-30 Filed 2013-08-05
10-Q 2013-03-31 Filed 2013-05-03
10-Q 2012-09-30 Filed 2012-11-08
10-Q 2012-06-30 Filed 2012-08-09
10-Q 2012-03-31 Filed 2012-05-07
10-K 2011-12-31 Filed 2012-03-12
10-Q 2011-09-30 Filed 2011-11-04
10-Q 2011-06-30 Filed 2011-08-05
10-Q 2011-03-31 Filed 2011-05-06
10-K 2010-12-31 Filed 2011-03-15
10-Q 2010-09-30 Filed 2010-11-05
10-Q 2010-06-30 Filed 2010-08-06
10-Q 2010-03-31 Filed 2010-05-07
10-K 2009-12-31 Filed 2010-03-15
8-K 2020-05-11 Shareholder Vote
8-K 2020-05-06 Earnings, Exhibits
8-K 2020-04-07 Other Events, Exhibits
8-K 2020-03-30 Amend Bylaw, Other Events, Exhibits
8-K 2020-03-26 Other Events, Exhibits
8-K 2020-03-19 Other Events, Exhibits
8-K 2020-03-10 Officers, Exhibits
8-K 2020-02-27 Earnings, Exhibits
8-K 2019-12-13 Officers, Exhibits
8-K 2019-11-04 Officers, Exhibits
8-K 2019-10-30 Earnings, Exhibits
8-K 2019-10-29 Enter Agreement, M&A, Off-BS Arrangement, Exhibits
8-K 2019-09-11 Regulation FD
8-K 2019-09-11 Enter Agreement, Exhibits
8-K 2019-07-31 Earnings, Exhibits
8-K 2019-05-02 Shareholder Vote
8-K 2019-05-02 Officers, Exhibits
8-K 2019-05-01 Earnings, Exhibits
8-K 2019-03-06 Officers, Exhibits
8-K 2019-02-28 Earnings, Exhibits
8-K 2018-10-31 Earnings, Exhibits
8-K 2018-08-01 Earnings, Exhibits
8-K 2018-05-03 Shareholder Vote
8-K 2018-05-03 Earnings, Exhibits
8-K 2018-04-06 Other Events
8-K 2018-03-12 Other Events
8-K 2018-03-01 Earnings, Exhibits

ALG 10Q Quarterly Report

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risks
Item 4. Controls and Procedures
Part II. Other Information
Item 1. - Legal Proceedings
Item 1A. - Risk Factors
Item 2. - Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. - Defaults Upon Senior Securities
Item 4. - Mine Safety Disclosures
Item 5. - Other Information
Item 6. - Exhibits
EX-31.1 a2020331-ex311.htm
EX-31.2 a2020331-ex312.htm
EX-31.3 a2020331-ex313.htm
EX-32.1 a2020331-ex321.htm
EX-32.2 a2020331-ex322.htm
EX-32.3 a2020331-ex323.htm

Alamo Group Earnings 2020-03-31

Balance SheetIncome StatementCash Flow
0.90.70.50.40.20.02012201420172020
Assets, Equity
0.30.20.20.10.10.02012201420172020
Rev, G Profit, Net Income
0.20.10.0-0.0-0.1-0.22012201420172020
Ops, Inv, Fin

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2020
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____ TO ____

Commission file number 0-21220

ALAMO GROUP INC.
(Exact name of registrant as specified in its charter)
Delaware
74-1621248
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification Number)

 1627 East Walnut, Seguin, Texas  78155
(Address of principal executive offices, including zip code)
 
830-379-1480
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
Common Stock, par value
$.10 per share
ALGNew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer
Accelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No ☒

At May 1, 2020, 11,860,233 shares of common stock, $.10 par value, of the registrant were outstanding.


1






































Alamo Group Inc. and Subsidiaries
 
INDEX
 
                                                                                                                                                                              
PART I.
FINANCIAL INFORMATION
PAGE
Item 1.
Interim Condensed Consolidated Financial Statements  (Unaudited)
March 31, 2020 and December 31, 2019
Three Months Ended March 31, 2020 and March 31, 2019
Three Months Ended March 31, 2020 and March 31, 2019
Three Months Ended March 31, 2020 and March 31, 2019
Three Months Ended March 31, 2020 and March 31, 2019
Item 2.
Item 3.
Item 4.
PART II.
Item 1.
Legal Proceedings
Item 1A.
Risk Factors
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
Item 3.
Defaults Upon Senior Securities
Item 4.
Mine Safety Disclosures
Item 5.
Other Information
Item 6.
Exhibits

2






































Alamo Group Inc. and Subsidiaries
Interim Condensed Consolidated Balance Sheets
(Unaudited) 
 
(in thousands, except share amounts)
March 31, 2020December 31, 2019
ASSETS
Current assets:
Cash and cash equivalents
$84,425  $42,311  
Accounts receivable, net
248,773  237,837  
Inventories, net
273,648  267,674  
Prepaid expenses and other current assets
10,243  10,099  
Income tax receivable
6,878  12,907  
Total current assets
623,967  570,828  
Rental equipment, net
52,045  56,467  
Property, plant and equipment
297,729  302,113  
Less:  Accumulated depreciation
(141,349) (141,388) 
Total property, plant and equipment, net
156,380  160,725  
Goodwill
195,561  198,022  
Intangible assets, net
202,344  206,272  
Deferred income taxes
1,026  1,078  
Other non-current assets
18,553  19,371  
Total assets
$1,249,876  $1,212,763  
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Trade accounts payable
$88,891  $81,986  
Income taxes payable
2,079  2,362  
Accrued liabilities
52,923  59,686  
Current maturities of long-term debt and finance lease obligations
18,826  18,840  
Total current liabilities
162,719  162,874  
Long-term debt and finance lease obligations, net of current maturities
471,429  425,141  
Long-term tax liability
6,778  7,432  
Deferred pension liability
1,654  1,844  
Other long-term liabilities
25,307  19,254  
Deferred income taxes
21,580  26,461  
Stockholders’ equity:
Common stock, $0.10 par value, 20,000,000 shares authorized; 11,761,259 and 11,752,509 outstanding at March 31, 2020 and December 31, 2019, respectively
1,176  1,175  
Additional paid-in-capital
114,967  113,666  
Treasury stock, at cost; 82,600 shares at March 31, 2020 and December 31, 2019, respectively
(4,566) (4,566) 
Retained earnings
514,320  500,320  
Accumulated other comprehensive loss
(65,488) (40,838) 
Total stockholders’ equity
560,409  569,757  
Total liabilities and stockholders’ equity
$1,249,876  $1,212,763  

See accompanying notes.
3






































Alamo Group Inc. and Subsidiaries
Interim Condensed Consolidated Statements of Income
(Unaudited)
 
Three Months Ended
March 31,
(in thousands, except per share amounts)20202019
Net sales:
Industrial
$229,975  $173,530  
Agricultural
84,473  88,404  
Total net sales314,448  261,934  
Cost of sales235,508  198,626  
Gross profit78,940  63,308  
Selling, general and administrative expenses51,248  39,847  
Amortization expenses3,836  855  
Income from operations
23,856  22,606  
Interest expense(5,519) (1,450) 
Interest income356  173  
Other income (expense), net2,341  (389) 
Income before income taxes
21,034  20,940  
Provision for income taxes5,506  5,687  
Net Income
$15,528  $15,253  
Net income per common share:
Basic
$1.32  $1.30  
Diluted
$1.31  $1.30  
Average common shares:
Basic
11,761  11,698  
Diluted
11,827  11,777  
Dividends declared$0.13  $0.12  
 
 See accompanying notes.
 
4






































Alamo Group Inc. and Subsidiaries
Interim Condensed Consolidated Statements of Comprehensive (Loss) Income
(Unaudited)

Three Months Ended
March 31,
(in thousands)20202019
Net income$15,528  $15,253  
Other comprehensive (loss) income:
Foreign currency translation adjustment
(20,454) 720  
Net gain on pension and other post-retirement benefits
246  215  
Unrealized losses on derivative instruments
(4,390)   
Other comprehensive (loss) income before income tax expense
(24,598) 935  
Income tax expense related to items of other comprehensive income(52) (45) 
Other comprehensive (loss) income
(24,650) 890  
Comprehensive (loss) income$(9,122) $16,143  

See accompanying notes.


5







































Alamo Group Inc. and Subsidiaries
Interim Condensed Consolidated Statements of Stockholders’ Equity
 (Unaudited)


For three months ended March 31, 2020
Common Stock
Additional
Paid-in Capital
Treasury StockRetained Earnings
Accumulated
Other
Comprehensive Loss
Total Stock-
holders’ Equity
(in thousands)
SharesAmount
Balance at December 31, 201911,670  $1,175  $113,666  $(4,566) $500,320  $(40,838) $569,757  
Other comprehensive income
—  —  —  —  15,528  (24,650) (9,122) 
Stock-based compensation expense
—  —  933  —  —  —  933  
Exercise of stock options
9  1  368  —  —  —  369  
Dividends paid ($0.13 per share)
—  —  —  —  (1,528) —  (1,528) 
Balance at March 31, 202011,679  $1,176  $114,967  $(4,566) $514,320  $(65,488) $560,409  




For three months ended March 31, 2019
Common Stock
Additional Paid-in Capital
Treasury StockRetained Earnings
Accumulated
Other
Comprehensive Loss
Total Stock-
holders’ Equity
(in thousands)SharesAmount
Balance at December 31, 201811,620  $1,166  $108,422  $(426) $443,040  $(44,831) $507,371  
Other comprehensive income
—  —  —  —  15,253  890  16,143  
Stock-based compensation expense
—  —  627  —  —  —  627  
Repurchased shares(15) —  —  (1,490) —  —  (1,490) 
Exercise of stock options
11  1  236  —  —  —  237  
  Dividends paid ($0.12 per share)
—  —  —  —  (1,404) —  (1,404) 
Balance at March 31, 201911,616  $1,167  $109,285  $(1,916) $456,889  $(43,941) $521,484  


See accompanying notes.

6






































Alamo Group Inc. and Subsidiaries
Interim Condensed Consolidated Statements of Cash Flows
(Unaudited)
Three Months Ended
March 31,
(in thousands)20202019
Operating Activities
Net income$15,528  $15,253  
Adjustment to reconcile net income to net cash provided by operating activities:
Provision for doubtful accounts
197  (24) 
Depreciation - Property, plant and equipment
4,624  3,338  
Depreciation - Rental equipment
2,516  2,088  
Amortization of intangibles
3,836  855  
Amortization of debt issuance costs
167  55  
Stock-based compensation expense
933  627  
Provision for deferred income tax (benefit) expense(4,095) 1,865  
Gain on sale of property, plant and equipment
(745) (180) 
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable
(16,306) (34,936) 
Inventories
(11,675) (17,098) 
Rental equipment
1,906  (7,453) 
Prepaid expenses and other assets
(1,139) (1,472) 
Trade accounts payable and accrued liabilities
2,833  1,563  
Income taxes payable
5,829  2,925  
Long-term tax payable(654) 258  
Other assets and long-term liabilities, net
1,819  (25) 
Net cash provided by (used in) operating activities
5,574  (32,361) 
Investing Activities
Acquisitions, net of cash acquired  (50,477) 
Purchase of property, plant and equipment(7,378) (5,284) 
Proceeds from sale of property, plant and equipment2,385  472  
Net cash used in investing activities(4,993) (55,289) 
Financing Activities
Borrowings on bank revolving credit facility74,000  103,000  
Repayments on bank revolving credit facility(24,000) (8,000) 
Principal payments on long-term debt and finance leases(3,791) (37) 
Dividends paid(1,528) (1,404) 
Proceeds from exercise of stock options369  237  
Treasury stock repurchased  (1,490) 
Net cash provided by financing activities45,050  92,306  
Effect of exchange rate changes on cash and cash equivalents(3,517) 324  
Net change in cash and cash equivalents42,114  4,980  
Cash and cash equivalents at beginning of the year42,311  34,043  
Cash and cash equivalents at end of the period$84,425  $39,023  
Cash paid during the period for:
Interest
$5,513  $1,061  
Income taxes
2,690  2,814  
See accompanying notes.
7






































Alamo Group Inc. and Subsidiaries
Notes to Interim Condensed Consolidated Financial Statements - (Unaudited)
March 31, 2020
 
1.  Basis of Financial Statement Presentation

General

The accompanying unaudited interim condensed consolidated financial statements of Alamo Group Inc. and its subsidiaries (the “Company”) have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulations S-X.  Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.  In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included.  Operating results for the periods presented are not necessarily indicative of the results that may be expected for the year ending December 31, 2020.  The balance sheet at December 31, 2019 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements.  For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2019 (the "2019 10-K").

Accounting Pronouncements Adopted on January 1, 2020

In August 2018, the FASB issued Accounting Statement Update (ASU) No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement”, which modifies the disclosures requirements on fair value measurements. Among other things, the amendments added disclosures for changes in unrealized gains and losses on Level 3 fair value measurements and required additional disclosures on unobservable inputs associated with Level 3 assets. The guidance became effective for us on January 1, 2020. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses,” to improve information on credit losses for financial instruments. The ASU replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses. This guidance became effective for us on January 1, 2020. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements.

Accounting Pronouncements Not Yet Adopted

In August 2018, the FASB issued Accounting Statement Update (ASU) No. 2018-14, “Compensation, Defined Benefit Plans", which modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The update removes certain disclosures that are no longer considered cost beneficial and adds disclosure requirements identified as relevant. The guidance will become effective for us on January 1, 2021 with early adoption permitted for any financial statements that have not been issued. The impacts that adoption of the ASU is expected to have on our financial disclosures is being evaluated.

In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes” to simplify the accounting for income taxes. The amendments in this Update simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. The guidance will become effective for us on January 1, 2021 with early adoption permitted for any financial statements that have not been issued. The impacts that adoption of the ASU is expected to have on our financial disclosures is being evaluated.


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2.  Business Combinations

Morbark, LLC.

On October 24, 2019, the Company completed the acquisition of 100% of the outstanding capital shares of Morbark, LLC. ("Morbark") a former portfolio company of Stellex Capital Management. Morbark manufacturers equipment and aftermarket parts for forestry, tree maintenance, biomass, land management and recycling markets. These products are marketed under the Morbark, Rayco, Denis Cimaf and Boxer Equipment brand names. The total consideration for the purchase was approximately $354.0 million on a debt free basis and subject to certain post-closing adjustments.

The primary reason for the acquisition was to expand and complement our range of vegetation maintenance equipment in an adjacent market along with accelerating Morbark's international growth using the Company's existing presence in Europe, Brazil and Australia.

The valuation of Morbark resulted in goodwill of $103.3 million, all of which has been assigned to the Company's Industrial reporting segment, $74.5 million of goodwill is tax deductible, the remaining balance is not.

The acquisition was accounted for in accordance with ASC Topic 805 Business Combinations ("ASC Topic 805"). The total purchase price has been allocated on a preliminary basis to assets acquired and liabilities assumed, including deferred taxes, based on their estimated fair values as of October 24, 2019. Certain estimated values are not yet finalized and are subject to change. The Company will finalize goodwill and deferred tax amounts once the analysis is complete.

During the first quarter of 2020, Morbark generated approximately $53.3 million of net sales and $2.3 million of net income. The Company has included the operating results of Morbark in its consolidated financial statements since the date of acquisition.

The following table reflects the estimated fair value of the assets acquired and liabilities assumed as of the acquisition date (in thousands):

Accounts receivable$13,966  
Inventory72,972  
Prepaid and other assets5,180  
Rental Equipment1,133  
Property, plant and equipment42,972  
Intangible assets149,790  
Deferred tax liability(7,503) 
Other liabilities assumed(32,275) 
Net assets assumed$246,235  
Goodwill103,341  
Total Acquisition Price net cash349,576  
Plus: Cash4,735  
Total Consideration354,311  

Dutch Power Company B.V.

On March 4, 2019, the Company acquired 100% of the issued and outstanding equity interests of Dutch Power Company B.V. ("Dutch Power"). Dutch Power designs, manufactures and sells a variety of landscape and vegetation management machines primarily in Europe. The primary reason for the Dutch Power acquisition was to enhance the Company's platform for growth by increasing both the Company's product portfolio and capabilities in the European market. The acquisition price was approximately $53.0 million.
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The Company completed its review of the valuation of the purchase price allocation for Morbark during the first quarter of 2020. The Company found that no additional changes were necessary and that the values disclosed in the 2019 10-K were final.

3.  Accounts Receivable
 
Accounts receivable is shown net of sales discounts and the allowance for doubtful accounts.

At March 31, 2020 the Company had $19.4 million in reserves for sales discounts compared to $16.9 million at December 31, 2019 related to products shipped to our customers under various promotional programs. The
change was primarily due to additional discounts reserved related to sales of the Company's agricultural products sold during the first three months of 2020.
 
4.  Inventories
 
Inventories valued at LIFO cost represented 45% and 42% of total inventory at March 31, 2020 and December 31, 2019, respectively. The excess of current cost over LIFO valued inventories was approximately $10.9 million at March 31, 2020 and December 31, 2019. An actual valuation of inventory under the LIFO method is made only at the end of each year based on the inventory levels and costs at that time.  Accordingly, interim LIFO must be based, to some extent, on management's estimates at each quarter end. Net inventories consist of the following:
(in thousands)
March 31, 2020December 31, 2019
Finished goods
$236,964  $227,823  
Work in process
21,972  21,918  
Raw materials
14,712  17,933  
Inventories, net$273,648  $267,674  
 
Inventory obsolescence reserves were $9.3 million at March 31, 2020 and $8.2 million at December 31, 2019.

5. Rental Equipment

Rental equipment is shown net of accumulated depreciation of $15.7 million and $14.6 million at March 31, 2020 and December 31, 2019, respectively. The Company recognized depreciation expense of $2.5 million and $2.1 million for the three months ended March 31, 2020 and March 31, 2019.

6.  Fair Value Measurements
 
The carrying values of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses, approximate their fair value because of the short-term nature of these items. The carrying value of our debt approximates the fair value as of March 31, 2020 and December 31, 2019, as the floating rates on our outstanding balances approximate current market rates. This conclusion was made based on Level 2 inputs.

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7. Goodwill and Intangible Assets

The following is the summary of changes to the Company's Goodwill for the three months ended March 31, 2020:
IndustrialAgriculturalConsolidated
(in thousands)
Balance at December 31, 2019$183,307  $14,715  $198,022  
Translation adjustment(1,247) (1,893) (3,140) 
Goodwill adjustment679    679  
Balance at March 31, 2020$182,739  $12,822  $195,561  

The following is a summary of the Company's definite and indefinite-lived intangible assets net of the accumulated amortization:
(in thousands)
Estimated Useful Lives
March 31, 2020December 31, 2019
Definite:
Trade names and trademarks
15-25 years
$66,734  $67,222  
Customer and dealer relationships
8-15 years
121,888  121,508  
Patents and drawings
3-12 years
28,255  28,485  
Favorable leasehold interests
7 years
4,200  4,200  
Total at cost221,077  221,415  
Less accumulated amortization(24,233) (20,643) 
Total net196,844  200,772  
Indefinite:
Trade names and trademarks5,500  5,500  
Total Intangible Assets$202,344  $206,272  

The Company recognized amortization expense of $3.8 million and $0.9 million for the three months ending March 31, 2020 and 2019, respectively. The increase in amortization is related to the intangible assets created in the Morbark acquisition.

As of March 31, 2020, the Company had $202.3 million of intangible assets, which represents 16% of total assets. 

8.  Leases
  
The Company leases office space and equipment under various operating and finance leases, which generally are expected to be renewed or replaced by other leases. The components of lease cost were as follows:
Components of Lease Cost
Three Months Ended
March 31,
(in thousands)20202019
Finance lease cost:
     Amortization of right-of-use assets$24  $31  
     Interest on lease liabilities2  2  
Operating lease cost1,225  1,024  
Short-term lease cost235  52  
Variable lease cost118  105  
Total lease cost$1,604  $1,214  

Rent expense for the three months ending March 31, 2020 and 2019 was immaterial.
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Maturities of lease liabilities were as follows:
Future Minimum Lease Payments
March 31, 2020December 31, 2019
(in thousands)Operating LeasesFinance LeasesOperating LeasesFinance Leases
2020$3,143  (a)$69  (a)$4,305  $97  
20212,813  79  2,718  83  
20222,094  41  2,051  45  
20231,536  17  1,459  22  
2024993  17  941  19  
Thereafter2,603  12  2,587  14  
Total minimum lease payments$13,182  $235  $14,061  $280  
Less imputed interest(1,079) (14) (1,100) (16) 
Total lease liabilities$12,103  $221  $12,961  $264  
(a) Amounts represent remaining three months of payments due for 2019.
Future Lease Commencements

As of March 31, 2020, we have no additional operating leases that have not yet commenced.

Supplemental balance sheet information related to leases was as follows:

Operating Leases
(in thousands)March 31, 2020December 31, 2019
Other non-current assets
$12,018  $12,858  
Accrued liabilities3,634  3,972  
Other long-term liabilities8,469  8,989  
    Total operating lease liabilities$12,103  $12,961  
Finance Leases
(in thousands)March 31, 2020December 31, 2019
Property, plant and equipment, gross$471  $524