BRADY CORPBRC

BRADY CORP Leases Disclosure

10-KFiled Sep 4, 20252 min read
Leases
The Company leases certain manufacturing facilities, warehouses and office space, computer equipment, and vehicles accounted for as operating leases. Lease terms typically range from one year to ten years. As of July 31, 2025 and 2024, the Company did not have any finance leases.
Short-term lease expense, variable lease expenses, and sublease income were immaterial to the consolidated statements of income for the year ended July 31, 2025.
The following table summarizes lease expense recognized during the years ended July 31, 2025, 2024 and 2023:
 Consolidated Statements of Income LocationJuly 31, 2025July 31, 2024July 31, 2023
Operating lease costCost of goods sold$7,856 $6,257 $6,589 
Operating lease costSelling, general, and administrative expenses11,289 9,220 9,424 
The following table summarizes the maturity of the Company's lease liabilities as of July 31, 2025:
Years ending July 31, Operating Leases
2026$17,854 
202713,935 
20288,161 
20296,187 
20304,195 
Thereafter19,061 
Total lease payments$69,393 
Less: interest(10,594)
Present value of lease liabilities$58,799 
The weighted average remaining lease terms and discount rates for the Company's operating leases as of July 31, 2025 and 2024 were as follows:
July 31, 2025July 31, 2024
Weighted average remaining lease term (in years)6.23.8
Weighted average discount rate5.0 %5.1 %
Supplemental cash flow information related to the Company's operating leases during the years ended July 31, 2025 and 2024 were as follows:
20252024
Operating cash outflows from operating leases$18,816 $16,496 
Operating lease assets obtained in exchange for new operating lease liabilities (1)
35,846 23,438 
(1)Includes new leases, leases from acquired companies, and remeasurements or modifications of existing leases.
The Company evaluates right-of-use assets for impairment in the same manner as long-lived assets. No impairment charges were recorded during the years ended July 31, 2025, 2024 or 2023.

Historical Timeline

Fiscal YearFiled
2025Sep 4, 2025Showing above
2024Sep 6, 2024
2023Sep 5, 2023
2022Sep 1, 2022
2021Sep 2, 2021
2020Sep 16, 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.

Other Available Disclosures

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