ABM INDUSTRIES INC /DE/ABM

ABM INDUSTRIES INC /DE/ Leases Disclosure

10-KFiled Dec 19, 20253 min read
LEASES
The components of lease assets and liabilities and their classification on our Consolidated Balance Sheets were as follows:
As of October 31,
(in millions)Classification20252024
Lease assets
Operating leasesRight-of-use assets$95.1 $101.2 
Finance leases
Property, plant and equipment, net(1)
15.6 20.5 
Total lease assets$110.7 $121.7 
Lease liabilities
Current liabilities
Operating leasesCurrent portion of lease liabilities$28.2 $26.6 
Finance leasesOther accrued liabilities3.9 4.5 
Noncurrent liabilities
Operating leasesLong-term lease liabilities83.7 92.0 
Finance leasesOther noncurrent liabilities11.1 15.0 
Total lease liabilities$126.9 $138.1 
(1) Finance lease assets are recorded net of accumulated amortization of $27.3 million and $23.1 million as of October 31, 2025, and October 31, 2024, respectively.
The components of lease costs and classification within the Consolidated Statements of Comprehensive Income were as follows:
Year Ended October 31,
(in millions)20252024
Operating lease costs:
Operating expenses(1)(2)
$88.1 $81.6 
Selling, general and administrative expenses(3)
27.9 26.4 
Finance lease costs:
Operating expenses(4)
4.9 4.6 
Interest expense(5)
1.0 1.1 
Total lease costs$121.9 $113.8 
(1) Related to certain parking arrangements.
(2) Includes short-term lease costs and variable lease costs.
(3) Includes short-term lease costs.
(4) Represents amortization of leased assets.
(5) Interest on lease liabilities.
The following table presents information on short-term and variable lease costs:
Year Ended October 31,
(in millions)20252024
Short-term lease costs$73.2 $64.0 
Variable lease costs6.8 6.8 
Total short-term and variable lease costs$80.0 $70.8 
Sublease income generated during the year ended October 31, 2025, was immaterial.
The amounts of future undiscounted cash flows related to the lease payments over the lease terms and the reconciliation to the present value of the lease liabilities as recorded on our Consolidated Balance Sheets as of October 31, 2025, are as follows:
(in millions)Operating
Lease Liabilities		Finance
Lease Liabilities		Total
Fiscal 2026
$33.4 $4.7 $38.1 
Fiscal 2027
26.7 3.1 29.9 
Fiscal 2028
20.2 3.1 23.3 
Fiscal 2029
15.3 3.1 18.5 
Fiscal 2030
10.9 2.9 13.9 
Thereafter24.6 0.2 24.8 
Total lease payments131.1 17.3 148.4 
Less: imputed interest19.3 2.3 21.5 
Present value of lease liabilities$111.9 $15.0 $126.9 
Future sublease rental income was excluded for the periods shown above as the amounts are immaterial.
We have entered into operating lease arrangements as of October 31, 2025, that are effective for future periods. The total amount of ROU assets and lease liabilities related to these arrangements is immaterial.
The following table includes the weighted-average remaining lease terms, in years, and the weighted-average discount rate used to calculate the present value of operating lease liabilities:
Year Ended October 31,
20252024
Weighted-average remaining lease term (years)
Operating leases5.55.5
Finance leases4.75.3
Weighted-average discount rate
Operating leases5.35 %5.05 %
Finance leases6.09 %5.88 %
The following table includes supplemental cash and non-cash information related to operating leases:
Year Ended October 31,
(in millions)20252024
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases$34.0 $35.3 
Operating cash flows from finance leases1.0 1.1 
Financing cash flows from finance leases4.5 4.2 
Lease assets obtained in exchange for new operating lease liabilities$20.5 20.9 

Historical Timeline

Fiscal YearFiled
2025Dec 19, 2025Showing above
2024Dec 19, 2024
2023Dec 18, 2023
2022Dec 21, 2022
2021Dec 22, 2021
2020Dec 17, 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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