ESAB CorpESAB

ESAB Corp Leases Disclosure

10-KFiled Feb 20, 20261 min read
Leases
The Company leases certain office spaces, warehouses, production facilities, vehicles and equipment. Leases with an initial term of twelve months or less are not recorded on the balance sheet. Most leases include renewal options, which can extend the lease term into the future. The Company determines the lease term by assuming options that are reasonably certain of being renewed will be exercised. Certain of the Company’s leases include rental payments adjusted for inflation. The right-of-use lease asset is recorded on the Consolidated Balance Sheets, with the current lease liability being included in Accrued liabilities and noncurrent lease liability being included in Other liabilities. During the year ended December 31, 2025, the Company recognized a non-cash transaction for a new material operating lease in the EMEA & APAC segment totaling approximately $29 million in Right-of-use lease asset and related lease liability. Operating lease expense was $28.7 million, $24.9 million and $25.4 million for the years ended December 31, 2025, 2024 and 2023, respectively.
December 31, 2025
(In thousands)
Future lease payments by year:
2026$28,379 
202726,093 
202819,582 
202914,418 
203012,754 
Thereafter50,245 
151,471 
Less: present value discount(41,249)
Present value of lease liabilities$110,222 
Weighted-average remaining lease term (in years):
Operating leases7.1
Weighted-average discount rate:
Operating leases8.5 %

Historical Timeline

Fiscal YearFiled
2025Feb 20, 2026Showing above
2024Feb 20, 2025
2023Feb 29, 2024
2022Mar 7, 2023

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

Income TaxesRevenueEarnings Per ShareFair ValuePP&EGoodwill & IntangiblesSegmentsDebtCommitmentsNew StandardsPay vs Performance