Varex Imaging CorpVREX
Varex Imaging Corp Leases Disclosure
LEASES
The Company has operating and finance leases for office space, warehouse and manufacturing space, vehicles, and certain equipment. The Company's lease agreements do not contain any material residual value guarantees, variable lease costs, bargain purchase options or restrictive covenants. The Company does not have any lease transactions with related parties. Leases with an initial term of 12 months or less are generally not recorded on the balance sheet and expense for these leases is recognized on a straight-line basis over the lease term. The Company's leases have remaining lease terms of less than one year to approximately ninety-three years, some of which may include options to extend the leases for up to five years and some include options to terminate early. These options have been included in the determination of the lease liability when it is reasonably certain that the option will be exercised.
Right-of-use assets represent the Company's right to use an underlying asset for the lease term, and lease liabilities represent the Company's obligation to make lease payments arising from the lease contract. Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of fixed lease payments over the expected lease term. The interest rate implicit in lease contracts is typically not readily determinable. As such, the Company's incremental borrowing rate is based on a credit-adjusted risk-free rate, which best approximates a secured rate over a similar term of lease.
The following table presents supplemental balance sheet information related to the Company's operating and finance leases:
| (In millions) | Balance Sheet Location | October 3, 2025 | September 27, 2024 | ||||||||||||||
| Assets | |||||||||||||||||
| Operating lease right-of-use assets | Operating lease assets | $ | 29.4 | $ | 28.3 | ||||||||||||
| Finance lease right-of-use assets | 5.7 | 6.6 | |||||||||||||||
| Liabilities | |||||||||||||||||
| Operating lease liabilities (current) | Current operating lease liabilities | 4.4 | 4.0 | ||||||||||||||
| Finance lease liabilities (current) | 0.4 | 0.4 | |||||||||||||||
| Operating lease liabilities (non-current) | Operating lease liabilities | 24.0 | 23.0 | ||||||||||||||
| Finance lease liabilities (non-current) | 5.6 | 5.9 | |||||||||||||||
The following table presents the weighted average remaining lease term and discount rate information related to the Company's operating and finance leases:
| October 3, 2025 | September 27, 2024 | ||||||||||
| Operating lease weighted average remaining lease term (in years) | 7.7 | 7.9 | |||||||||
| Operating lease weighted average discount rate | 7.2 | % | 8.0 | % | |||||||
| Finance lease weighted average remaining lease term (in years) | 13.2 | 13.9 | |||||||||
| Finance lease weighted average discount rate | 6.1 | % | 6.1 | % | |||||||
The following table provides information related to the Company’s operating and finance leases:
| (In millions) | 2025 | 2024 | 2023 | ||||||||||||||
Total operating lease costs(1) | $ | 6.2 | $ | 6.3 | $ | 5.8 | |||||||||||
| Amortization of right-of-use assets | $ | 1.0 | $ | 0.3 | $ | 0.2 | |||||||||||
| Interest on lease liabilities | 0.4 | — | — | ||||||||||||||
| Total finance lease costs | $ | 1.4 | $ | 0.3 | $ | 0.2 | |||||||||||
| Operating cash flows from operating leases | $ | 6.1 | $ | 5.9 | $ | 7.8 | |||||||||||
| Operating cash flows from finance leases | 0.4 | — | — | ||||||||||||||
| Financing cash flows from finance leases | 0.6 | 0.5 | 0.3 | ||||||||||||||
| Total cash paid for amounts included in the measurement of lease liabilities | $ | 7.1 | $ | 6.4 | $ | 8.1 | |||||||||||
| Noncash operating right-of-use assets obtained in exchange for new lease liabilities | $ | 8.1 | $ | 5.4 | $ | 10.6 | |||||||||||
| Noncash finance right-of-use assets obtained in exchange for new lease liabilities | 0.2 | 6.5 | 0.2 | ||||||||||||||
| Total right-of-use assets obtained in exchange for new lease liabilities | $ | 8.3 | $ | 11.9 | $ | 10.8 | |||||||||||
(1) Includes variable and short-term lease expense, which were immaterial for fiscal years 2025, 2024, and 2023.
As of October 3, 2025, maturities of operating lease and finance lease liabilities for each of the following five years and a total thereafter were as follows:
| (In millions) | |||||||||||
| Fiscal years: | Operating Leases | Finance Leases | |||||||||
| 2026 | $ | 6.2 | $ | 0.7 | |||||||
| 2027 | 5.5 | 0.7 | |||||||||
| 2028 | 4.5 | 0.6 | |||||||||
| 2029 | 3.7 | 0.6 | |||||||||
| 2030 | 3.6 | 0.6 | |||||||||
| Thereafter | 14.0 | 5.5 | |||||||||
| Total future lease payments | $ | 37.5 | $ | 8.7 | |||||||
| Less: imputed interest | (9.1) | (2.7) | |||||||||
| Present value of lease liabilities | $ | 28.4 | $ | 6.0 | |||||||
As of October 3, 2025, the Company had not entered into any material leases that have not yet commenced.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Nov 18, 2025 | Showing above |
| 2024 | Nov 19, 2024 | |
| 2023 | Nov 16, 2023 | |
| 2022 | Nov 18, 2022 | |
| 2021 | Nov 19, 2021 | |
| 2020 | Nov 30, 2020 | |
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.