MARTEN TRANSPORT LTD Leases Disclosure

9. Leases

 

We lease facilities, drop yards, office space, land and equipment, and previously chassis. All leases are classified as operating leases. We do not have any financing leases. Payments for operating leases that extend beyond 12 months are fixed.

 

Some leases include options to renew, with renewal terms that can extend the lease term from six months to five years. The exercise of lease renewal options is at our sole discretion and is considered in the determination of the operating lease assets and lease liabilities once reasonably certain of exercise.

 

Management has elected to apply the short-term lease exemption to leases with an initial term of 12 months or less and these leases are not capitalized. This primarily affects drop yards, for which we recognize lease expense on a straight-line basis over the lease term.

 

As of December 31, the classification of operating leases in our consolidated balance sheets was as follows:

 

(In thousands)		2025				2024
Assets:
Other noncurrent assets (a)		$	453			$	578
Liabilities:
Accrued and other current liabilities			259				296
Noncurrent operating lease liabilities			194				282
Total liabilities		$	453			$	578

 

(a)

Operating lease asset balances at December 31, 2025 and 2024.

 

The maturity of the operating lease liabilities is as follows:

 

		Amount
Maturities:
2026		$	291
2027			166
2028			53
Total lease payments			510
Adjust to present value			(57	)
Total operating lease liabilities		$	453

 

The weighted-average remaining lease term at December 31, 2025 was 24 months and at December 31, 2024 was 27 months. The weighted-average discount rate was 4.9% at December 31, 2025 and 6.5% at December 31, 2024. The operating leases identified do not specify implicit rates, accordingly, we use our incremental borrowing rate at the time of lease inception to determine the present value of lease payments.

 

Operating lease assets obtained in exchange for lease obligations in 2025 and 2024 totaled $171,000 and $253,000, respectively. We paid $339,000 of cash for capitalized operating leases during 2025 and $307,000 during 2024.

 

Total operating lease expense for 2025 was $4.5 million and for 2024 was $5.2 million. These amounts are reported within other operating expenses in our consolidated statements of operations and include $4.1 million and $4.9 million, respectively, of short-term lease expense with an initial term of 12 months or less.