Sotera Health CoSHC

Sotera Health Co Leases Disclosure

10-KFiled Feb 24, 20262 min read
Leases
We lease certain facilities and equipment under various non-cancelable leases. Most of our real property leases provide for renewal periods and rent escalations and stipulate that we pay taxes, maintenance, and certain other operating expenses applicable to the leased premises.
The components of lease expense were as follows:
Year Ended December 31,
(thousands of U.S. dollars)
202520242023
Operating lease costs (a)
$13,207 $13,267 $13,920 
Finance lease costs:
Amortization of right of use assets6,474 8,438 8,152 
Interest on lease liabilities6,105 6,064 4,394 
Total finance lease costs
12,579 14,502 12,546 
Total lease costs
$25,786 $27,769 $26,466 
(a)Includes $1.7 million, $1.5 million, and $1.4 million of short-term lease costs in the years ended December 31, 2025, 2024, and 2023, respectively.
Lease terms and discount rates were as follows:
Year Ended December 31,
 2025 2024
Weighted average remaining lease term: 
Operating leases11.1 years7.3 years
Finance leases14.9 years15.2 years
Weighted average discount rate:
Operating leases6.90 %6.57 %
Finance leases6.55 %6.55 %
Supplemental cash flow information related to leases was as follows:
Year Ended December 31,
(thousands of U.S. dollars)
202520242023
Cash paid for amounts included in the measurement of lease liabilities: 
Operating cash flows for operating leases$7,917 $7,382 $10,067 
Operating cash flows for finance leases
6,332 6,277 3,988 
Finance cash flows for finance leases3,903 8,088 1,823 
Supplemental non-cash information was as follows:
Year Ended December 31,
(thousands of U.S. dollars)
202520242023
Lease liabilities arising from obtaining right-of-use assets: 
Operating leases$10,822 $10,550 $4,559 
Finance leases431 36,016 14,770 
Maturities of lease liabilities as of December 31, 2025 are as follows:
(thousands of U.S. dollars)
Operating
Leases
Finance
Leases
Total
2026$8,134 $9,689 $17,823 
20277,187 9,968 17,155 
20285,760 10,263 16,023 
20294,717 9,933 14,650 
20303,767 9,634 13,401 
2031 and Thereafter22,069 108,811 130,880 
Total lease payments51,634 158,298 209,932 
Less imputed interest(15,978)(60,998)(76,976)
Total lease liabilities$35,656 $97,300 $132,956 

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.

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