8.
Leases

The Company has operating and finance leases for regional offices, manufacturing facilities, retail centers, distribution centers and certain equipment. The Company’s leases have remaining lease terms of 1 year to 12 years, some of which include options to extend the leases for up to 20 years, and some of which include options to terminate the leases within 1 year.

The weighted-average remaining lease term and weighted-average discount rate are as follows:

   
Year Ended December 31,
 
   
2025
   
2024
   
2023
 
Weighted-average remaining lease term:
                 
Operating leases
   
6.3
     
7.2
     
8.5
 
Finance leases
   
3.9
     
4.8
     
3.7
 
Weighted-average discount rate:
                       
Operating leases
   
3.9
%
   
3.5
%
   
3.6
%
Finance leases
   
6.6
%
   
6.6
%
   
3.7
%

The components of lease expense were as follows (U.S. dollars in thousands):

    Year Ended December 31,  
   
2025
    2024
    2023
 
Operating lease expense
                 
Operating lease cost
  $ 23,327    
$
23,668
   
$
29,186
 
Variable lease cost
    4,812      
6,203
     
4,245
 
Finance lease expense
                       
Amortization of right-of-use assets
    2,129      
2,707
     
4,785
 
Interest on lease liabilities
    632      
404
     
502
 
Total lease expense
  $ 30,900    
$
32,982
   
$
38,718
 

Supplemental cash flow information related to leases was as follows (U.S. dollars in thousands):

 
Year Ended December 31,
 
    2025
   
2024
   
2023
 
Operating cash outflow from operating leases
  $ 23,833    
$
24,609
   
$
29,055
 
Operating cash outflow from finance leases
  $ 640    
$
376
   
$
481
 
Financing cash outflow from finance leases
  $ 2,238    
$
2,886
   
$
3,198
 
Right-of-use assets obtained in exchange for operating lease obligations
  $ 24,912    
$
16,469
   
$
27,730
 
Right-of-use assets obtained in exchange for finance lease obligations
  $ 291    
$
30
   
$
1,081
 

Maturities of lease liabilities are as follows (U.S. dollars in thousands):

Year Ending December 31,
 
Operating
Leases
   
Finance
Leases
 
2026
 
$
20,972
   
$
2,521
 
2027
   
16,264
     
2,498
 
2028
   
12,158
     
2,462
 
2029
   
10,295
     
2,004
 
2030
   
5,492
     
6
 
Thereafter
   
19,342
     
 
Total
   
84,523
     
9,491
 
Less: Finance charges
   
8,443
     
1,116
 
Total principal liability
 
$
76,080
   
$
8,375
 

The Company has additional lease liabilities of $37.7 million which have not yet commenced as of December 31, 2025, and as such, have not been recognized on the consolidated balance sheets.

Historical Timeline

Fiscal YearFiled
2025Feb 13, 2026Showing above
2024Feb 14, 2025
2023Feb 15, 2024
2022Feb 16, 2023
2021Feb 16, 2022
2020Feb 11, 2021
2019Feb 13, 2020
2018Feb 14, 2019
2017Feb 16, 2018
2016Feb 27, 2017
2015Feb 18, 2016

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.