Metallus Inc. Leases Disclosure
Note 11 - Leases
The Company has operating leases primarily related to machinery and equipment, vehicles and information technology equipment. These leases have remaining lease terms of less than one year to approximately five years, some of which may include options to extend the lease for or more years. Certain leases also include options to purchase the leased asset. As of December 31, 2025, the Company has two financing leases for a total of $3.5 million. As of December 31, 2025, the weighted average remaining lease term for our operating leases was 3.2 years and our finance leases was 4.3 years.
Leases with an initial term of 12 months or less ("short-term leases") are not recorded on the balance sheet. Rather, the Company recognizes lease expense for these leases on a straight-line basis over the lease term in accordance with the applicable accounting guidance. For lease agreements entered into after the adoption of lease accounting guidance on January 1, 2019, the Company combines lease and non-lease components. The Company’s lease agreements do not contain material residual value guarantees or material restrictive covenants.
The components of operating and finance lease cost for the years ended December 31, 2025, 2024 and 2023 as follows:
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Year Ended December 31, |
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2025 |
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2024 |
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2023 |
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Operating lease cost |
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$ |
7.6 |
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$ |
7.5 |
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$ |
7.3 |
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Short-term lease cost |
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1.0 |
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1.5 |
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0.8 |
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Finance lease cost |
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Amortization of right-of-use assets |
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0.6 |
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— |
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— |
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Interest on lease liabilities |
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0.2 |
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— |
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— |
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Total lease cost |
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$ |
9.4 |
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$ |
9.0 |
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$ |
8.1 |
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When available, the rate implicit in the lease is used to discount lease payments to present value; however, the Company’s leases generally do not provide a readily determinable implicit rate. Therefore, the incremental borrowing rate to discount the lease payments is estimated using market-based information available at lease commencement. The weighted average discount rate used to measure our operating lease liabilities as of December 31, 2025 and 2024 was 4.9%, respectively. The weighted average discount rate used to measure our financing lease liabilities as of December 31, 2025 was 4.8%.
Supplemental cash flow information related to leases was as follows:
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Year Ended December 31, |
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2025 |
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2024 |
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2023 |
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Cash paid for amounts included in the measurement of operating lease liabilities |
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$ |
6.3 |
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$ |
6.9 |
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$ |
7.1 |
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Right-of-use assets obtained in exchange for operating lease obligations |
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$ |
5.5 |
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$ |
5.5 |
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$ |
5.6 |
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Cash paid for amounts included in the measurement of financing lease liabilities |
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$ |
0.4 |
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$ |
— |
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|
$ |
— |
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Right-of-use assets obtained in exchange for financing lease obligations |
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$ |
3.9 |
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|
$ |
— |
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|
$ |
— |
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Future minimum lease payments under non-cancellable leases as of December 31, 2025 were as follows:
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Operating Leases |
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Financing Leases |
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2026 |
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$ |
4.5 |
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$ |
0.9 |
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2027 |
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3.4 |
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|
0.9 |
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2028 |
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2.7 |
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|
0.9 |
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2029 |
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1.4 |
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|
0.8 |
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2030 and after |
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0.3 |
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|
0.3 |
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Total future minimum lease payments |
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12.3 |
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|
3.8 |
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Less amount of lease payment representing interest |
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(0.9 |
) |
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(0.3 |
) |
Total present value of lease payments |
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$ |
11.4 |
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|
$ |
3.5 |
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 20, 2026 | Showing above |
| 2024 | Feb 27, 2025 | |
| 2023 | Feb 28, 2024 | |
| 2022 | Feb 24, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 25, 2020 | |
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.