EASTERN CO Leases Disclosure
9. LEASES
The Company enters into leases for manufacturing facilities, warehouses, sales offices, plant equipment, vehicles, and certain other equipment with varying end dates from February 2026 to April 2033, including renewal options
The following table (in millions) represents the impact of leasing on the consolidated balance sheets:
|
| Balance Sheet Classification |
|
| January 3, 2026 |
|
| December 28, 2024 |
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Assets: |
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|
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Operating lease assets, net |
| Right of use assets |
|
| $ | 16.0 |
|
| $ | 14.2 |
| |
Finance lease right of use assets, net |
| Property, plant and equipment, net |
|
|
| 4.0 |
|
|
| 3.8 |
| |
Total leased assets, net |
|
|
|
|
| 20.0 |
|
|
| 18.0 |
| |
|
|
|
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|
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|
|
|
|
|
| |
Liabilities: |
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|
|
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|
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|
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|
|
|
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Current operating lease liabilities |
| Current portion of operating lease liability |
|
|
| 3.8 |
|
|
| 3.1 |
| |
Current finance lease liabilities |
| Current portion of financing lease liability |
|
|
| 0.9 |
|
|
| 0.8 |
| |
Noncurrent operating lease liabilities |
| Operating lease liability, less current portion |
|
|
| 12.2 |
|
|
| 11.1 |
| |
Noncurrent finance lease liabilities |
| Financing lease liability, less current portion |
|
|
| 3.1 |
|
|
| 3.1 |
| |
Total lease liabilities |
|
|
|
|
| $ | 20.0 |
|
| $ | 18.0 |
|
Cash paid included in the measurement of operating lease liabilities was $4.0 million and $4.3 million for the fiscal years ended January 3, 2026 and December 28, 2024, respectively, all of which were included within the operating cash flow section of the consolidated statements of cash flows. Lease assets obtained in exchange for new operating lease liabilities were $4.5 million and $0.4 million for the fiscal years ended January 3, 2026 and December 28, 2024, respectively.
Cash paid included in the measurement of finance lease liabilities was $0.9 million and $0.4 million for the fiscal years ended January 3, 2026 and December 28, 2024, respectively, which were included within the financing cash flow section of the consolidated statements of cash flows for the fiscal years ended January 3, 2026 and December 28, 2024, respectively.
Total operating lease expense was $4.5 million and $4.9 million for the fiscal years ended January 3, 2026 and December 28, 2024, respectively.
Total financing lease expense was $0.3 million and $0.1 million for the fiscal years ended January 3, 2026 and December 28, 2024, respectively.
The future payments (in millions) due under non-cancelable operating and finance leases as of January 3, 2026 are as follows:
|
| Operating |
|
| Finance |
| ||
2026 |
| $ | 3.7 |
|
| $ | 0.9 |
|
2027 |
|
| 3.4 |
|
|
| 0.9 |
|
2028 |
|
| 3.0 |
|
|
| 0.9 |
|
2029 |
|
| 2.6 |
|
|
| 0.9 |
|
2030 |
|
| 1.7 |
|
|
| 0.7 |
|
thereafter |
|
| 4.0 |
|
|
| 0.5 |
|
|
|
| 18.4 |
|
|
| 4.8 |
|
Less effects of discounting |
|
| (2.4 | ) |
|
| (0.8 | ) |
Lease liabilities recognized |
| $ | 16.0 |
|
| $ | 4.0 |
|
As of January 3, 2026, the weighted average lease term for all operating and finance leases is 5.9 and 5.2 years, respectively. The weighted average discount rate associated with operating leases was 7.0% while the weighted average discount rate associated with finance leases was 7.2%.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | Mar 3, 2026 | Showing above |
| 2024 | Mar 11, 2025 | |
| 2019 | Mar 5, 2020 | |
| 2018 | Mar 14, 2019 | |
| 2016 | Mar 15, 2017 | |
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.