CALERES INC Leases Disclosure
13. LEASES
The Company leases all of its retail locations, a manufacturing facility, and certain office locations, distribution centers and equipment. At contract inception, leases are evaluated and classified as either operating or finance leases. Leases with an initial term of 12 months or less are not recorded on the balance sheet.
Lease right-of-use assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term. The majority of the Company’s leases do not provide an implicit rate and therefore, the Company uses an incremental borrowing rate based on the information available at the commencement date to determine the present value of future payments. For operating leases, lease expense for the minimum lease payments is recognized on a straight-line basis over the lease term. Variable lease payments are expensed as incurred.
The Company regularly analyzes the results of all of its stores and assesses the viability of underperforming stores to determine whether events or circumstances exist that indicate the stores should be closed or whether the carrying amount of their long-lived assets may not be recoverable. After allowing for an appropriate start-up period and consideration of any unusual nonrecurring events, property and equipment at stores and the lease right-of-use assets indicated as impaired are written down to fair value as calculated using a discounted cash flow method. The fair value of the lease right-of-use assets and property and equipment is determined utilizing projected cash flows for each store location, discounted using a risk-adjusted discount rate, subject to a market floor based on current market lease rates. Refer to Note 14 to the consolidated financial statements for further discussion of impairment charges on the Company’s operating lease right-of-use assets and property and equipment in its retail stores.
The weighted-average lease term and discount rate as of January 31, 2026 and February 1, 2025 were as follows:
| January 31, 2026 | February 1, 2025 | ||||
Weighted-average remaining lease term (in years) |
| 5.7 | 6.1 | |||
Weighted-average discount rate |
| 5.5 | % | 5.2 | % |
During 2025, the Company entered into new or amended leases that resulted in the recognition of right-of-use assets and lease obligations of $150.7 million on the consolidated balance sheets. As of January 31, 2026, the Company has entered into lease commitments for six retail locations for which the leases have not yet commenced. The Company anticipates that the leases for four of the new retail locations will begin in the next fiscal year and two will begin in fiscal year 2027. Upon commencement, and of approximately $6.5 million and $2.0 million will be recorded on the consolidated balance sheets in 2026 and 2027, respectively. In addition, the Company has entered into a lease commitment for its corporate headquarters that will begin in fiscal 2026. Upon commencement, right-of-use assets and lease liabilities of approximately $52.0 million will be recorded.
The components of lease expense for 2025, 2024 and 2023 were as follows:
($ thousands) | | 2025 |
| 2024 | 2023 | ||||
Operating lease expense | $ | 169,000 | $ | 160,832 | $ | 156,849 | |||
Variable lease expense |
| 42,865 |
| 46,672 |
| 42,983 | |||
Short-term lease expense |
| 963 |
| 1,149 |
| 2,757 | |||
Total lease expense | $ | 212,828 | $ | 208,653 | $ | 202,589 | |||
The aggregate future annual lease payments at January 31, 2026 were as follows:
($ thousands) | | | |
2026 | $ | 192,041 | |
2027 |
| 136,421 | |
2028 |
| 102,482 | |
2029 |
| 73,715 | |
2030 |
| 53,240 | |
Thereafter |
| 135,575 | |
Total minimum operating lease payments | $ | 693,474 | |
Less imputed interest |
| (98,843) | |
Present value of lease obligations | $ | 594,631 |
Supplemental cash flow information related to leases is as follows:
($ thousands) | | 2025 |
| 2024 |
| 2023 | |||
Cash paid for lease obligations | $ | 187,685 | $ | 158,156 | $ | 181,420 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | Apr 2, 2026 | Showing above |
| 2025 | Apr 1, 2025 | |
| 2024 | Apr 2, 2024 | |
| 2023 | Mar 28, 2023 | |
| 2022 | Mar 28, 2022 | |
| 2021 | Mar 30, 2021 | |
| 2020 | Mar 31, 2020 | |
| 2019 | Apr 3, 2019 | |
| 2018 | Apr 4, 2018 | |
| 2017 | Mar 28, 2017 | |
| 2016 | Mar 29, 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.