SHENANDOAH TELECOMMUNICATIONS CO/VA/SHEN

SHENANDOAH TELECOMMUNICATIONS CO/VA/ Leases Disclosure

10-KFiled Feb 26, 20262 min read
Leases
The Company leases various broadband network sites, fiber optic cable routes, warehouses, retail stores and office facilities for use in our business.

The components of lease costs were as follows:

ClassificationYears Ended December 31,
(in thousands)202520242023
Finance lease cost
Amortization of leased assetsDepreciation$726 $665 $477 
Interest on lease liabilitiesInterest expense103 95 78 
Operating lease cost
Operating expense1
4,382 4,316 3,054 
Lease cost$5,211 $5,076 $3,609 
_________________________________________
(1)Operating lease expense is presented in cost of service or selling, general and administrative expense based on the use of the relevant facility.
The following table summarizes the expected maturity of lease liabilities at December 31, 2025:
(in thousands)Operating LeasesFinance LeasesTotal
2026$3,616 $443 $4,059 
20272,569 246 2,815 
20282,140 202 2,342 
20291,751 206 1,957 
20301,502 206 1,708 
2031 and thereafter6,544 3,272 9,816 
Total lease payments18,122 4,575 22,697 
Less: interest(4,671)(2,336)(7,007)
Present value of lease liabilities$13,451 $2,239 $15,690 

December 31,
2025		December 31,
2024
Operating leases
Weighted average remaining lease term (years)8.48.5
Weighted average discount rate6.3 %6.1 %
Finance leases
Weighted average remaining lease term (years)17.39.0
Weighted average discount rate6.5 %5.3 %

Years Ended December 31,
(in thousands)202520242023
Cash paid for operating lease liabilities
$4,526 $4,480 $3,218 
Operating lease right-of-use assets obtained in exchange for new lease liabilities (includes new leases or modifications of existing leases)
$1,731 $2,250 $1,968 

The Company recognized $6.8 million, $5.8 million and $2.6 million of operating lease revenue for the years ended December 31, 2025, 2024 and 2023, respectively, related to the dedicated fiber optic strands that we lease to our customers, which is included in service revenue and other in the consolidated statements of operations. Substantially all of our lease revenue relates to fixed lease payments.

Below is a summary of our contractual minimum rental receipts expected under the lease agreements in place at December 31, 2025:
(in thousands)Operating Leases
2026$4,047 
20273,650 
20283,457 
20293,303 
20303,097 
2031 and thereafter14,710 
Total $32,264 

Historical Timeline

Fiscal YearFiled
2025Feb 26, 2026Showing above
2024Feb 20, 2025
2023Feb 21, 2024
2022Feb 22, 2023
2021Feb 28, 2022
2020Feb 25, 2021
2019Feb 26, 2020
2016Mar 23, 2017
2015Feb 26, 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.

Other Available Disclosures

Income TaxesRevenueEarnings Per SharePP&EGoodwill & IntangiblesSegmentsDebtCommitmentsStock CompensationNew Standards