Primoris Services Corp Leases Disclosure
Note 10—Leases
We lease administrative and operational facilities, which are generally longer-term, project specific facilities or yards, and construction equipment under non-cancelable operating leases. We determine if an arrangement is a lease at inception. We have lease agreements with lease and non-lease components, which are generally accounted for separately. Operating leases are included in “Operating lease assets”, “Accrued liabilities”, and “Noncurrent operating lease liabilities, net of current portion” on our Consolidated Balance Sheets. We also made an accounting policy election in which leases with an initial term of 12 months or less are not recorded on the balance sheet and lease payments are recognized in the Consolidated Statements of Income on a straight-line basis over the lease term.
Operating lease assets and operating lease liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. In determining our lease term, we include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. For our leases that do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date to determine the present value of future payments. Lease expense from minimum lease payments is recognized on a straight-line basis over the lease term.
Our leases have remaining lease terms that expire at various dates through 2035, some of which may include options to extend the leases for up to 5 years. The exercise of lease extensions is at our sole discretion. Periodically, we sublease excess facility space, but any sublease income is generally not significant. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The components of operating lease expense are as follows (in millions):
Year Ended December 31, | |||||||||
2025 | | 2024 | | 2023 | |||||
Operating lease expense (1) | $ | 177.4 | $ | 148.3 | $ | 112.2 | |||
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| (1) | Includes short-term leases, which are immaterial. |
Our operating lease liabilities are reported on the Consolidated Balance Sheets as follows (in millions):
December 31, | December 31, | |||||
| 2025 | 2024 | ||||
$ | 155.4 | $ | 122.0 | |||
Noncurrent operating lease liabilities, net of current portion |
| 325.6 |
| 333.4 | ||
$ | 481.0 | $ | 455.4 | |||
The future minimum lease payments under non-cancelable operating leases are as follows (in millions):
Future Minimum | |||
For the Years Ending December 31, | Lease Payments | ||
2026 | | $ | 178.2 |
2027 | 154.8 | ||
2028 | 108.9 | ||
2029 | 60.2 | ||
2030 | 18.4 | ||
Thereafter | 10.0 | ||
Total lease payments | $ | 530.5 | |
Less imputed interest |
| (49.5) | |
Total | $ | 481.0 | |
Other information related to operating leases is as follows (in millions, except lease term and discount rate):
Year ended December 31, | ||||||
| 2025 | | 2024 | |||
Cash paid for amounts included in the measurement of lease liabilities | ||||||
Operating cash flows from operating leases | $ | 165.7 | $ | 145.8 | ||
Weighted-average remaining lease term on operating leases (years) | 3.46 | 3.90 | ||||
Weighted-average discount rate on operating leases | 6.32% | 6.50% | ||||
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 24, 2026 | Showing above |
| 2024 | Feb 25, 2025 | |
| 2023 | Feb 27, 2024 | |
| 2022 | Feb 28, 2023 | |
| 2021 | Mar 1, 2022 | |
| 2020 | Feb 23, 2021 | |
| 2019 | Feb 25, 2020 | |
| 2017 | Feb 26, 2018 | |
| 2016 | Feb 28, 2017 | |
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.