Beachbody Company, Inc. Leases Disclosure
Note 12. Leases
The Company leases facilities under noncancelable operating leases expiring through 2027 and certain equipment under a finance lease expiring in 2024.
As of December 31, 2023 and 2022, the Company had of $3.3 million and $5.3 million respectively, and of $3.1 million and $5.0 million, respectively. As of December 31, 2023 and 2022, the Company had of approximately zero and $0.1 million, respectively, and of approximately zero and $0.1 million, respectively.
The Company’s leases do not require any contingent rental payments, impose any financial restrictions, or contain any residual value guarantees. Certain of the Company’s leases include renewal options and escalation clauses; renewal options have not been included in the calculation of lease liabilities and ROU assets as the Company is not
reasonably certain to exercise these options. Variable expenses generally represent the Company’s share of the landlord operating expenses.
The following summarizes the Company’s leases (in thousands):
|
|
Year Ended December 31, |
|
|||||
|
|
2023 |
|
|
2022 |
|
||
Finance lease costs: |
|
|
|
|
|
|
||
Amortization of right-of-use asset |
|
$ |
73 |
|
|
$ |
192 |
|
Interest on lease liabilities |
|
|
2 |
|
|
|
8 |
|
Operating lease costs |
|
|
2,097 |
|
|
|
2,150 |
|
Short-term lease costs |
|
|
18 |
|
|
|
202 |
|
Variable lease costs |
|
|
301 |
|
|
|
566 |
|
Short-term sublease income |
|
|
(32 |
) |
|
|
(127 |
) |
Total lease costs |
|
$ |
2,459 |
|
|
$ |
2,991 |
|
|
|
Year Ended December 31, |
|
|||||
|
|
2023 |
|
|
2022 |
|
||
Cash paid for amounts included in the measurement of lease liabilities |
|
|
|
|
|
|
||
Operating cash flows from finance leases |
|
$ |
2 |
|
|
$ |
8 |
|
Operating cash flows from operating leases |
|
|
2,319 |
|
|
|
2,195 |
|
Financing cash flows from finance leases |
|
|
121 |
|
|
|
153 |
|
Right-of-use asset obtained in exchange for new operating lease liabilities |
|
|
— |
|
|
|
420 |
|
|
|
|
|
|
|
|
||
Weighted-average remaining lease term - finance leases |
|
|
0.3 |
|
|
|
1.3 |
|
Weighted-average remaining lease term - operating leases |
|
|
2.3 |
|
|
|
2.9 |
|
|
|
|
|
|
|
|
||
Weighted-average discount rate - finance leases |
|
|
4.0 |
% |
|
|
4.0 |
% |
Weighted-average discount rate - operating leases |
|
|
4.1 |
% |
|
|
4.5 |
% |
Maturities of operating and finance lease liabilities, excluding short-term leases, are as follows (in thousands):
|
|
Operating Leases |
|
|
Finance Leases |
|
|
Total |
|
|||
Year ended December 31, 2024 |
|
$ |
2,079 |
|
|
$ |
2 |
|
|
$ |
2,081 |
|
Year ended December 31, 2025 |
|
|
687 |
|
|
|
— |
|
|
|
687 |
|
Year ended December 31, 2026 |
|
|
712 |
|
|
|
— |
|
|
|
712 |
|
Year ended December 31, 2027 |
|
|
132 |
|
|
|
— |
|
|
|
132 |
|
Total |
|
|
3,610 |
|
|
|
2 |
|
|
|
3,612 |
|
Less present value discount |
|
|
(352 |
) |
|
|
- |
|
|
|
(352 |
) |
Lease liabilities at December 31, 2023 |
|
$ |
3,258 |
|
|
$ |
2 |
|
|
$ |
3,260 |
|
As the Company’s lease agreements do not provide an implicit rate, the discount rates used to determine the present value of lease payments are generally based on the Company’s estimated incremental borrowing rate for a secured borrowing of a similar term as the lease.
In November 2021, the Company entered into an agreement effective January 2022, assigning its Santa Monica office lease to a third party with a lease term expiring in 2025. Although the lease assignment requires the Company to remain secondarily liable as a surety with respect to the lease, the Company does not believe it is probable that it will be responsible for the obligations. The value of the associated guarantee liability is insignificant.
On February 29, 2024, the Company sold its Van Nuys production facility and entered into a five year lease of the facility at an annual base rate of $0.3 million. See Note 23, Subsequent Events, for additional information on the lease of this facility.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2023 | Mar 11, 2024 | Showing above |
| 2022 | Mar 16, 2023 | |
| 2021 | Mar 1, 2022 | |
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.