FIRST MID BANCSHARES, INC. Leases Disclosure
Note 20 -- Leases
The Company recognizes a lease liability and a right-of-use asset, based on the present value of lease payments over the lease term. The discount rate used in determining the present value is the Company's incremental borrowing rate which is the FHLB fixed advance rate based on the lease commencement date. In addition, the Company has elected not to include short-term leases (i.e. leases with terms of twelve months or less) or equipment leases (primarily copiers) deemed immaterial, on the consolidated balance sheets. The following table contains supplemental balance sheet information related to leases (dollars in thousands):
|
|
2025 |
|
|
2024 |
|
||
Operating lease right-of-use assets |
|
$ |
12,674 |
|
|
$ |
13,861 |
|
Operating lease liabilities |
|
|
13,210 |
|
|
|
14,190 |
|
Weighted-average remaining lease term (in years) |
|
4.4 |
|
|
4.7 |
|
||
Weighted-average discount rate |
|
|
3.54 |
% |
|
|
3.22 |
% |
Certain of the Company's leases contain options to renew the lease; however, not all renewal options are included in the calculation of lease liabilities as they are not reasonably certain to be exercised. The Company's leases do not contain residual value guarantees or material variable lease payments. The Company does not have any other material restrictions or covenants imposed by leases that would impact the Company's ability to pay dividends or cause the Company to incur additional financial obligations.
Future minimum lease payments under operating leases are (in thousands):
|
|
Operating Leases |
|
|
2026 |
|
$ |
3,327 |
|
2027 |
|
|
3,089 |
|
2028 |
|
|
2,439 |
|
2029 |
|
|
1,982 |
|
2030 |
|
|
1,338 |
|
Thereafter |
|
|
2,483 |
|
Total minimum lease payments |
|
|
14,658 |
|
Less imputed interest |
|
|
(1,448 |
) |
Total lease liability |
|
$ |
13,210 |
|
The components of lease expense for the twelve months ended December 31, 2025 and 2024 were as follows (in thousands):
|
|
2025 |
|
|
2024 |
|
||
Operating lease cost |
|
$ |
3,331 |
|
|
$ |
3,394 |
|
Short-term lease cost |
|
|
145 |
|
|
|
118 |
|
Variable lease cost |
|
|
1,182 |
|
|
|
775 |
|
Total lease cost |
|
|
4,658 |
|
|
|
4,287 |
|
Income from subleases |
|
|
(326 |
) |
|
|
(429 |
) |
Net lease cost |
|
$ |
4,332 |
|
|
$ |
3,858 |
|
As the Company elected not to separate lease and non-lease components, the variable lease cost primarily represents variable payment such as common area maintenance and copier expense. The Company does not have any material sub-lease agreements. The Company recognized a $630,000 gain on the sale of their branch location in St. Louis, MO and subsequently leased the property back from the buyer with a lease term ending on December 31, 2026. Cash paid for amounts included in the measurement of lease liabilities was (in thousands):
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Operating cash flows from operating leases |
|
$ |
3,309 |
|
|
$ |
3,333 |
|
|
$ |
3,263 |
|
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Feb 28, 2025 | |
| 2023 | Mar 6, 2024 | |
| 2022 | Mar 3, 2023 | |
| 2021 | Mar 2, 2022 | |
| 2020 | Mar 8, 2021 | |
| 2019 | Mar 9, 2020 | |
| 2018 | Mar 5, 2019 | |
| 2017 | Mar 2, 2018 | |
| 2016 | Mar 6, 2017 | |
| 2015 | Mar 4, 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.