LeasesThe Company leases certain transportation and mobile manufacturing equipment such as railcars and forklifts, as well as real estate.
The components of lease expense are as follows:
| | | | | | | | | | | | | | | | | | |
| (in thousands) | | 2025 | | 2024 | | 2023 |
| Operating lease cost | | $ | 3,387 | | | $ | 3,966 | | | $ | 4,896 | |
| | | | | | |
| Finance lease cost: | | | | | | |
| Amortization of lease assets | | 120 | | | 91 | | | 39 | |
| Interest on lease liabilities | | 28 | | | 27 | | | 13 | |
| Short-term lease cost | | 104 | | | 130 | | | 123 | |
| Variable lease cost | | 976 | | | 335 | | | 743 | |
| Total lease cost | | $ | 4,615 | | | $ | 4,549 | | | $ | 5,814 | |
Supplemental cash-flow and other information related to leases is as follows:
| | | | | | | | | | | | | | | | | | |
| (in thousands) | | 2025 | | 2024 | | 2023 |
| Cash paid for amounts included in the measurement of lease liabilities | | | | | | |
| Operating cash outflows - payments on operating leases | | $ | (2,115) | | | $ | (2,815) | | | $ | (3,919) | |
| Operating cash outflows - interest payments on finance leases | | (28) | | | (27) | | | (13) | |
| Financing cash outflows - payments on finance lease obligations | | (111) | | | (82) | | | (36) | |
| Right-of-use assets obtained in exchange for operating lease obligations | | — | | | 4,775 | | | 2,621 | |
| Right-of-use assets obtained in exchange for finance lease obligations | | 86 | | | 130 | | | 291 | |
Supplemental balance sheet information related to leases is as follows:
| | | | | | | | | | | | | | | | | |
| | | December 31, |
| (dollars in thousands) | | | 2025 | | 2024 |
| Location | | | | |
| Operating Leases | | | | | |
| Operating lease right-of-use assets | Other assets | | $ | 4,392 | | | $ | 6,261 | |
| | | | | |
| Current operating lease liabilities | Other accrued liabilities | | 1,719 | | | 2,050 | |
| Non-current operating lease liabilities | Other long-term obligations | | 2,697 | | | 4,077 | |
| Total operating lease liabilities | | | $ | 4,416 | | | $ | 6,127 | |
| | | | | |
| Finance Leases | | | | | |
| Property, plant and equipment | Property, plant and equipment | | $ | 591 | | | $ | 484 | |
| Accumulated depreciation | Accumulated depreciation | | 250 | | | 130 | |
| Finance lease assets, net | | | $ | 341 | | | $ | 354 | |
| Other liabilities and accrued items | Other liabilities and accrued items | | $ | 143 | | | $ | 119 | |
| Finance lease liabilities | Other long-term obligations | | 217 | | | 248 | |
| Total principal payable on finance leases | | | $ | 360 | | | $ | 367 | |
| | | | | |
| Weighted-Average Remaining Lease Term | | | | | |
| Operating leases | | | 5.6 years | | 5.1 years |
| Finance leases | | | 3.1 years | | 3.6 years |
| | | | | |
| Weighted-Average Discount Rate | | | | | |
| Operating leases | | | 6.77 | % | | 6.46 | % |
| Finance leases | | | 7.31 | % | | 7.55 | % |
As of December 31, 2025, future minimum lease payments under noncancellable operating leases were as follows:
| | | | | | | | | | | | | | |
| (in thousands) | | Finance Leases | | Operating Leases |
| 2026 | | 145 | | | 1,816 | |
| 2027 | | 107 | | | 806 | |
| 2028 | | 88 | | | 509 | |
| 2029 | | 36 | | | 485 | |
| 2030 | | 8 | | | 461 | |
| 2031 and thereafter | | — | | | 1,409 | |
| Total lease payments | | $ | 384 | | | $ | 5,486 | |
| Less: Imputed interest | | (24) | | | (1,070) | |
| Present value of lease payments | | $ | 360 | | | $ | 4,416 | |
As of December 31, 2025, the Company has not entered into any material lease commitments that have yet to commence.
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.