7. Leases
The Company has leases for manufacturing, sales, support, and engineering facilities, certain manufacturing and office equipment, and vehicles. The majority of the leases have remaining terms of 1 to 9 years, some of which include options to extend the leases for up to 6 years, and some of which include options to terminate the leases within 1 year. The lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company subleases certain facilities to third parties.
The disclosures below include the results of both continuing and discontinued operations. As stated in Note 1. Summary of Significant Accounting Policies, subsequent to the sale of CMM on December 27, 2024, the Company leases portions of its facilities to Syntiant. The portion of right-of-use operating lease assets subleased by Syntiant totaled $5.2 million and $0.3 million at December 31, 2025 and 2024, respectively.
The following table details the components of lease cost:
| | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, |
| (in millions) | 2025 | | 2024 | | 2023 | | |
Operating lease cost (1) | $ | 6.4 | | | $ | 6.9 | | | $ | 7.9 | | | |
| Finance lease cost: | | | | | | | |
| Amortization of right-of-use assets | 0.4 | | | 2.3 | | | 2.3 | | | |
| Interest on lease liabilities | — | | | 0.1 | | | 0.2 | | | |
| Sublease income | (1.0) | | | (0.2) | | | (3.3) | | | |
| Total lease cost | $ | 5.8 | | | $ | 9.1 | | | $ | 7.1 | | | |
(1) Includes short-term and variable lease costs, which were immaterial.
The components of lease cost other than interest on lease liabilities are presented within "Cost of goods sold," "Research and development expenses," and "Selling and administrative expenses" on the Consolidated Statements of Earnings based on the use of the underlying assets. Interest on lease liabilities is presented within "Interest expense, net" on the Consolidated Statements of Earnings.
The following table presents supplemental balance sheet information related to finance leases:
| | | | | | | | | | | | | | | | |
| (in millions) | Balance Sheet Line | December 31, 2025 | | December 31, 2024 | | |
| Finance lease right-of-use assets | Property, plant, and equipment, net | $ | 0.6 | | | $ | 1.1 | | | |
| | | | | | |
| Current finance lease liabilities | Other accrued expenses | $ | 0.4 | | | $ | 0.4 | | | |
| Long-term finance lease liabilities | Other liabilities | 0.3 | | | 0.4 | | | |
| Total finance lease liabilities | | $ | 0.7 | | | $ | 0.8 | | | |
The following table presents supplemental cash flow information related to leases:
| | | | | | | | | | | | | | | | | | | |
| Years Ended December 31, |
| (in millions) | 2025 | | 2024 | | 2023 | | |
| Cash paid for amounts included in the measurement of lease liabilities: | | | | | | | |
| Operating cash flows from operating leases | $ | 5.6 | | | $ | 5.7 | | | $ | 9.1 | | | |
| Operating cash flows from finance leases | — | | | 0.1 | | | 0.2 | | | |
| Financing cash flows from finance leases | 0.5 | | | 1.5 | | | 2.5 | | | |
Lease liabilities arising from obtaining right-of-use assets:(2) | | | | | | | |
| Operating leases | $ | 15.8 | | | $ | 2.0 | | | $ | 2.6 | | | |
| Finance leases | 0.4 | | | 0.2 | | | 0.7 | | | |
(2) Does not include operating lease liabilities of $3.4 million and finance lease liabilities of $0.1 million obtained in the acquisition of CD during the year ended December 31, 2023. See Note 3. Acquisition for more information.
The following table details weighted-average remaining lease terms and discount rates:
| | | | | | | | | | | |
| December 31, 2025 | | December 31, 2024 |
| Weighted-average remaining lease term (in years): | | | |
| Operating leases | 6.5 | | 2.8 |
| Finance leases | 2.4 | | 2.6 |
| Weighted-average discount rate: | | | |
| Operating leases | 6.6 | % | | 5.6 | % |
| Finance leases | 6.5 | % | | 5.9 | % |
The following table details maturities of lease liabilities as of December 31, 2025:
| | | | | | | | | | | |
| (in millions) | Operating Leases | | Finance Leases |
| 2026 | 5.2 | | | 0.4 | |
| 2027 | 4.6 | | | 0.2 | |
| 2028 | 3.3 | | | 0.1 | |
| 2029 | 2.1 | | | — | |
| 2030 | 2.1 | | | — | |
| 2031 and thereafter | 7.7 | | | — | |
| Total lease payments | 25.0 | | | 0.7 | |
| Less interest | (4.8) | | | — | |
| Present value of lease liabilities | $ | 20.2 | | | $ | 0.7 | |