LEASES
The Company leases property, plant and equipment, which primarily includes real estate and vehicles. We determine if an arrangement is a lease at inception. Operating leases are included in Right-of-use assets, Operating lease liabilities and Operating lease liabilities, net of current portion in the Consolidated Balance Sheets. Finance leases are included in Net property, plant and equipment and finance leases, financing lease liabilities and financing lease liabilities, net of current portion in the Consolidated Balance Sheets.
Amounts relating to leases are presented in the Consolidated Balance Sheets in the following line items:

(in thousands)
Assets:ClassificationDecember 31, 2025December 31, 2024
Operating lease assetsRight-of-use assets$17,651 $16,902 
Finance lease assetsNet property, plant and equipment and finance leases21,638 24,581 
Total non-current lease assets$39,289 $41,483 
Liabilities:
Current
Operating lease liabilitiesOperating lease liabilities$3,819 $3,204 
Finance lease liabilitiesFinancing lease liabilities1,894 1,644 
Non-current
Operating lease liabilities
Operating lease liabilities, net of current portion
15,125 13,801 
Finance lease liabilities
Financing lease liabilities, net of current portion
26,742 28,501 
Total lease liabilities$47,580 $47,150 
The components of lease expense included in the Consolidated Statements of Operations are as follows:

Year ended December 31,
(in thousands)Classification202520242023
Operating lease expense:   
Operating lease expenseSelling, general and administrative expenses$4,930 $4,561 $3,751 
Short-term lease expenseSelling, general and administrative expenses1,358 1,940 2,122 
Variable lease expense (1)
Selling, general and administrative expenses69 396 300 
Total operating lease expense6,357 6,897 6,173 
   
Finance lease expense:   
Amortization of right-of-use assetsCost of operations2,132 2,116 2,080 
Interest on lease liabilitiesInterest expense2,427 2,037 2,813 
Total finance lease expense4,559 4,153 4,893 
   
Net lease cost$10,916 $11,050 $11,066 
(1) Variable lease expense primarily consists of common area maintenance expenses paid directly to lessors of real estate leases.

We incurred an impairment of $1.0 million related to the reduction of our real estate footprint for the year ended December 31, 2025.

Other information related to leases is as follows:

Year ended December 31,
(in thousands)202520242023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases$6,039 $4,543 $3,788 
Operating cash flows - finance leases2,343 2,155 2,235 
Financing cash flows - finance leases1,674 1,369 1,195 

(dollars in thousands)
December 31, 2025December 31, 2024
Right-of-use assets obtained in exchange for lease liabilities:
Operating leases$3,778 $10,403 
Finance leases41 4,333 
Weighted-average remaining lease term:
Operating leases (in years)7.48.2
Finance leases (in years)8.59.5
Weighted-average discount rate:
Operating leases7.1 %8.3 %
Finance leases8.0 %8.0 %
Future minimum lease payments required under non-cancellable leases as of December 31, 2025 are as follows:
(in thousands)Operating LeasesFinance LeasesTotal
2026$4,940 $4,096 $9,036 
20274,349 4,154 8,503 
20283,729 4,212 7,941 
20292,601 6,732 9,333 
20301,900 3,942 5,842 
Thereafter7,688 17,035 24,723 
Total25,207 40,171 65,378 
Less imputed interest(6,263)(11,535)(17,798)
Lease liability$18,944 $28,636 $47,580 

Historical Timeline

Fiscal YearFiled
2025Mar 16, 2026Showing above
2024Mar 31, 2025
2023Mar 15, 2024
2022Mar 16, 2023
2021Mar 8, 2022
2020Mar 8, 2021
2019Mar 30, 2020
2016Feb 28, 2017
2015Feb 25, 2016

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.