Inotiv, Inc.NOTVQ

Inotiv, Inc. Leases Disclosure

10-KFiled Dec 5, 20253 min read
LEASES
Right-of-use ("ROU") lease assets and lease liabilities that are reported in the Company’s consolidated balance sheets are as follows:
September 30, 2025September 30, 2024
Operating ROU assets, net$46,358 $49,165 
Current portion of operating lease liabilities6,896 11,774 
Long-term operating lease liabilities44,344 40,010 
Total operating lease liabilities$51,240 $51,784 
Finance ROU assets, net$2,900 $652 
Current portion of finance lease liabilities495 211 
Long-term finance lease liabilities2,430 433 
Total finance lease liabilities$2,925 $644 
The increase in operating right-of-use lease assets and lease liabilities in the twelve months ended September 30, 2025 was primarily related to modifications of leases in both the DSA and RMS segments. The increase in financing right-of-use lease assets and lease liabilities in the twelve months ended September 30, 2025 was primarily due to new vehicles leases associated with the insourcing of the Company's North American transportation operations.
Lease expense for lease payments is recognized on a straight-line basis over the lease term. The components of lease expense related to the Company’s leases for the twelve months ended September 30, 2025, 2024 and 2023 were:
Fiscal Year Ended
September 30,
202520242023
Operating lease costs:
Fixed operating lease costs$13,459 $13,474 $11,790 
Lease (income)(2,537)(3,003)(3,039)
Financing lease costs:
Amortization of ROU asset expense$397 $87 $39 
Interest on finance lease liability315 31 3 
Total operating lease cost11,634 10,589 8,793 
The Company serves as lessor to a lessee in thirteen facilities. The gross rental income and underlying lease expense are presented net in the Company’s consolidated statements of operations. The gross rent receivables and underlying lease liabilities are presented gross in the Company’s consolidated balance sheets.
Supplemental cash flow information related to leases was as follows:
Fiscal Year Ended
September 30,
202520242023
Cash flows included in the measurement of lease liabilities: 
Operating cash flows from operating leases$10,774 $12,003 $11,252 
Non-cash lease activity: 
ROU assets obtained in exchange for new operating lease liabilities$7,177 $19,301 $15,831 
ROU assets obtained in exchange for new finance lease liabilities2,666 703 — 
The weighted average remaining lease term and discount rate for the Company’s operating leases as of September 30, 2025, 2024 and 2023 were:
Fiscal Year Ended
September 30,
202520242023
Weighted-average remaining lease term (in years)
Operating lease9.569.256.71
Finance lease5.754.211.81
Weighted-average discount rate (in percentages)
Operating lease11.98 %11.71 %9.36 %
Finance lease12.56 %13.75 %4.86 %
Lease duration was determined utilizing renewal options that the Company is reasonably certain to execute.
As of September 30, 2025, maturities of operating lease liabilities for each of the following five fiscal years and a total thereafter were as follows:
Operating LeasesFinance Leases
2026$12,240 $826 
202710,526 797 
20289,356 769 
20298,516 707 
20307,096 320 
Thereafter41,794 710 
Total minimum future lease payments89,528 4,129 
Less interest(38,288)(1,204)
Total lease liability$51,240 $2,925 
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Historical Timeline

Fiscal YearFiled
2025Dec 5, 2025Showing above
2024Dec 4, 2024
2023Dec 12, 2023
2022Jan 13, 2023
2021Dec 21, 2021
2020Dec 22, 2020
2019Dec 26, 2019
2018Dec 21, 2018
2017Dec 22, 2017
2016Dec 28, 2016
2015Dec 24, 2015

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.

Other Available Disclosures

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