NEOGEN CORP Leases Disclosure
5. Leases
We lease various manufacturing, laboratory, warehousing and distribution facilities, administrative and sales offices, equipment and vehicles under operating and finance leases.
Supplemental balance sheet information related to operating and finance leases was as follows:
|
|
Year Ended May 31, |
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|||||
|
|
2025 |
|
|
2024 |
|
||
Rights of use - non-current assets |
|
$ |
17,152 |
|
|
$ |
14,785 |
|
|
$ |
5,641 |
|
|
$ |
5,101 |
|
|
|
$ |
12,860 |
|
|
$ |
10,300 |
|
|
Property and equipment |
|
$ |
2,425 |
|
|
$ |
2,423 |
|
|
$ |
2,426 |
|
|
$ |
2,447 |
|
|
The weighted average remaining lease term and weighted average discount rate were as follows:
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|
Year Ended May 31, |
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|||||
|
|
2025 |
|
|
2024 |
|
||
Operating Leases |
|
|
|
|
|
|
||
Weighted average remaining lease term |
|
6.5 years |
|
|
3.9 years |
|
||
Weighted average discount rate |
|
|
6.0 |
% |
|
|
5.6 |
% |
|
|
|
|
|
|
|
||
Financing Lease |
|
|
|
|
|
|
||
Weighted average remaining lease term |
|
0.3 years |
|
|
0.3 years |
|
||
Weighted average discount rate |
|
|
6.1 |
% |
|
|
6.1 |
% |
Operating lease expenses are classified as cost of revenues or operating expenses on the consolidated statements of operations. The components of lease expense were as follows:
|
|
Year Ended May 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
Operating leases |
|
$ |
6,189 |
|
|
$ |
4,510 |
|
Short term leases |
|
|
722 |
|
|
|
625 |
|
Financing lease expense: |
|
|
|
|
|
|
||
Amortization of asset |
|
|
299 |
|
|
|
219 |
|
Interest on lease liability |
|
|
18 |
|
|
|
12 |
|
Total lease expense |
|
$ |
7,228 |
|
|
$ |
5,366 |
|
Supplemental cash flow information is as follows:
|
|
Year Ended May 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Cash paid for amounts included in the measurement of lease liabilities: |
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|
|
|
|
|
|
|
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|||
Operating cash flows for operating leases |
|
$ |
5,680 |
|
|
$ |
4,714 |
|
|
$ |
2,139 |
|
Operating cash flows for finance leases |
|
$ |
18 |
|
|
$ |
12 |
|
|
|
— |
|
Financing cash flows for finance leases |
|
$ |
298 |
|
|
$ |
192 |
|
|
|
— |
|
Non-cash assets obtained in exchange for lease obligations: |
|
|
|
|
|
|
|
|
|
|||
Operating leases |
|
$ |
7,113 |
|
|
$ |
5,562 |
|
|
$ |
11,192 |
|
Finance leases |
|
|
— |
|
|
$ |
2,642 |
|
|
|
— |
|
Future lease payments as of May 31, 2025 are as follows:
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|
Operating |
|
|
Finance |
|
||
Years ending May 31, |
|
Leases |
|
|
Lease |
|
||
2026 |
|
$ |
6,257 |
|
|
$ |
2,431 |
|
2027 |
|
|
4,638 |
|
|
|
— |
|
2028 |
|
|
3,237 |
|
|
|
— |
|
2029 |
|
|
1,763 |
|
|
|
— |
|
2030 |
|
|
1,153 |
|
|
|
— |
|
2031 and thereafter |
|
|
6,773 |
|
|
|
— |
|
Total lease payments |
|
$ |
23,821 |
|
|
$ |
2,431 |
|
Less: imputed interest |
|
|
(5,320 |
) |
|
|
(5 |
) |
|
$ |
18,501 |
|
|
$ |
2,426 |
|
|
As of May 31, 2025, the Company had additional leases, primarily for real estate that have not yet commenced with undiscounted lease payments of approximately $2,316. The leases are expected to commence in the first half of fiscal year 2026 with lease terms up to seven years.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Jul 30, 2025 | Showing above |
| 2024 | Jul 30, 2024 | |
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.