Leases
Our lease obligations relate primarily to our principal executive offices along with various manufacturing, warehouse and distribution facilities located throughout the world. For leases with terms greater than twelve months, we record a right of use (“ROU”) asset and corresponding lease obligation. As of December 31, 2025, all our leasing arrangements were operating leases. Many of our leases include escalating rent payments, renewal options and termination options, which are considered in our determination of straight-line rent expense when appropriate. Many of our leases also include additional amounts for common area maintenance and taxes. We have elected not to separate lease and non-lease components in the determination of straight-line rent expense. For a majority of our leases, an implicit lease rate is not available. Accordingly, we use a rate that approximates our incremental secured borrowing rate.
In 2024, we entered into an amendment to the lease for our principal executive offices in Alpharetta, Georgia, under which we reduced our leased space and extended the term of our remaining space by five years. We recognized a $6.9 million gain on the early partial lease termination, which is included in “Other (income) expense, net” in the accompanying consolidated income statement for the year ended December 31, 2024.
The table below summarizes information related to ROU assets and lease liabilities that are included in the accompanying consolidated balance sheet (dollars in millions):
| | | | | | | | | | | |
| As of December 31, |
| 2025 | | 2024 |
| Assets | | | |
| Operating lease right-of-use assets | $ | 27.6 | | | $ | 34.1 | |
| | | |
| Liabilities | | | |
| Current portion of operating lease liabilities | 8.2 | | | 10.9 | |
| Operating lease liabilities | 20.4 | | | 24.6 | |
| Total Operating Lease Liabilities | $ | 28.6 | | | $ | 35.5 | |
| | | |
| Weighted average remaining lease term | 6.7 years | | 6.7 years |
| Weighted average discount rate | 5.9 | % | | 5.6 | % |
The table below summarizes costs and cash flows arising from our lease arrangements for the years ended December 31, 2025 and December 31, 2024 (in millions):
| | | | | | | | | | | |
| Year Ended December 31, |
| 2025 | | 2024 |
| Operating lease cost | $ | 10.9 | | | $ | 12.8 | |
| Short-term lease cost | 0.2 | | | 0.2 | |
| Variable lease cost | 0.6 | | | 0.8 | |
| Total lease cost | $ | 11.7 | | | $ | 13.8 | |
| | | |
| Cash paid for amounts included in the measurement of lease liabilities | $ | 12.5 | | | $ | 21.3 | |
| Right-of-use assets obtained in exchange for operating lease liabilities | $ | 2.6 | | | $ | 19.7 | |
The future minimum obligations under operating leases having non-cancelable terms in excess of one year for the next five years and beyond will be (in millions):
| | | | | | | | |
For the years ending
December 31, | | Amount |
| 2026 | | $ | 8.4 | |
| 2027 | | 4.7 | |
| 2028 | | 4.1 | |
| 2029 | | 3.4 | |
| 2030 | | 3.2 | |
| Thereafter | | 11.8 | |
| Future minimum obligations | | $ | 35.6 | |
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.