TREX CO INC Leases Disclosure
For the years ended December 31, 2025, and December 31, 2024, total operating lease cost was $12.0 million and $10.4 million, respectively. The weighted average remaining lease term at December 31, 2025 and December 31, 2024 was 6.7 years and 6.3 years, respectively. The weighted average discount rate at December 31, 2025 and December 31, 2024 was 4.70% and 4.57%, respectively.
The following table includes supplemental cash flow information for the years ended December 31, 2025, December 31, 2024, and December 31, 2023 and supplemental balance sheet information at December 31, 2025 and December 31, 2024 related to operating leases (in thousands):
Supplemental Cash Flow Information |
|
For the Year Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Cash paid for amounts included in the measurement of |
|
$ |
11,402 |
|
|
$ |
10,361 |
|
|
$ |
8,176 |
|
Operating ROU assets obtained in exchange for lease liabilities |
|
$ |
10,663 |
|
|
$ |
35,704 |
|
|
$ |
2,559 |
|
Supplemental Balance Sheet Information |
|
December 31, |
|
|
December 31, |
|
||
Operating lease ROU assets |
|
$ |
52,632 |
|
|
$ |
52,195 |
|
Operating lease liabilities: |
|
|
|
|
|
|
||
Accrued expenses and other current liabilities |
|
$ |
12,079 |
|
|
$ |
10,800 |
|
Operating lease liabilities |
|
|
41,755 |
|
|
|
41,979 |
|
Total operating lease liabilities |
|
$ |
53,834 |
|
|
$ |
52,779 |
|
The following table summarizes maturities of operating lease liabilities at December 31, 2025 (in thousands):
Maturities of operating lease liabilities |
|
|
|
|
2026 |
|
$ |
12,369 |
|
2027 |
|
|
11,777 |
|
2028 |
|
|
10,724 |
|
2029 |
|
|
5,420 |
|
2030 |
|
|
4,307 |
|
Thereafter |
|
|
19,782 |
|
Total lease payments |
|
$ |
64,379 |
|
Less imputed interest |
|
|
(10,545 |
) |
Total operating liabilities |
|
$ |
53,834 |
|
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.