ACME UNITED CORP Leases Disclosure
15. Leases
The Company has operating leases for office and warehouse space and equipment under various arrangements which provide the right to use the underlying asset and require lease payments for the lease term. The Company’s lease portfolio consists of operating leases which expire at various dates through 2029.
Certain of the Company’s lease arrangements contain renewal provisions, exercisable at the Company's option. The probability of renewal is not reasonably certain and therefore not included in ROU assets and lease liabilities. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
Operating lease cost was $1.7 million and $1.3 million for the years ended December 31, 2024 and 2023, respectively. For the years ended December 31, 2024 and 2023, $0.7 million and $0.5 million, respectively, was included in cost of goods sold and $1.0 million and $0.8 million, respectively, was included in selling, general and administrative expenses in the accompanying consolidated statements of operations.
Information related to leases (dollars in 000’s):
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Year ended |
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Year ended |
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Operating cash flow information: |
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December 31, 2024 |
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December 31, 2023 |
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Operating lease cost |
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$ |
1,723 |
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|
$ |
1,344 |
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Operating lease - cash flow |
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$ |
1,763 |
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$ |
1,406 |
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Non-cash activity: |
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ROU assets obtained in exchange for lease liabilities |
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$ |
4,632 |
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$ |
581 |
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December 31, 2024 |
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December 31, 2023 |
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Weighted-average remaining lease term |
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3.6 years |
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2.0 years |
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Weighted-average discount rate |
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|
7 |
% |
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|
5 |
% |
Future minimum lease payments under non-cancellable leases as of December 31, 2024:
(dollars in 000’s):
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|
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2025 |
|
$ |
1,848 |
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2026 |
|
|
1,295 |
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2027 |
|
|
1,019 |
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2028 |
|
|
1,042 |
|
2029 |
|
|
360 |
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Total future minimum lease payments |
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$ |
5,564 |
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Less: imputed interest |
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|
(633 |
) |
Present value of lease liabilities - current |
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|
1,564 |
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Present value of lease liabilities - non-current |
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$ |
3,367 |
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2024 | Mar 6, 2025 | Showing above |
| 2019 | Mar 13, 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.