Sagimet Biosciences Inc. Leases Disclosure
7. | Leases |
Facility lease agreement
On March 12, 2019, the Company executed a 38-month non-cancelable operating lease agreement for 3,030 square feet of office space for its headquarters facility which commenced April 1, 2019. The lease provides for monthly lease payments of approximately $12 thousand with annual increases. On December 20, 2021, the lease agreement was amended to extend the term of the lease through June 2024. The Company has accounted for the lease as an operating lease. Operating lease cost was $0.2 million for both the years ended December 31, 2023 and 2022.
The following is a schedule by year of future maturities of the Company’s operating lease liabilities (in thousands):
December 31, | |||
2023 | |||
2024 |
| $ | 66 |
Total lease payments |
| 66 | |
Less: interest |
| (1) | |
Total | $ | 65 | |
Supplemental cash flow information related to leases was as follows (in thousands):
| Year Ended December 31, | |||||
| 2023 |
| 2022 | |||
Cash paid for amounts included in the measurement of lease liabilities: |
|
|
|
| ||
Operating cash flows from operating leases | $ | 158 | $ | 157 | ||
Weighted-average remaining lease term and discount rate were as follows as of December 31, 2023:
Weighted-average remaining lease term | 0.5 | years | |
Weighted-average discount rate | 7 | % |
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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.