Note 4 – Leases

The net right of use assets and lease liabilities recognized on the consolidated balance sheets for the Company's operating leases as of December 31, 2025 and 2024 are presented below:

  
 
December 31,
2025
   
December 31,
2024
 
Right of use assets
           
Operating Leases
           
Buildings and improvements
 
$
114,199
   
$
112,528
 
Machinery and equipment
   
5,547
     
5,425
 
Total
 
$
119,746
   
$
117,953
 
Current lease liabilities
               
Operating Leases
               
Buildings and improvements
 
$
23,555
   
$
22,993
 
Machinery and equipment
   
2,991
     
2,908
 
Total
 
$
26,546
   
$
25,901
 
Long-term lease liabilities
               
Operating Leases
               
Buildings and improvements
 
$
93,342
   
$
91,772
 
Machinery and equipment
   
2,457
     
2,446
 
Total
 
$
95,799
   
$
94,218
 
Total lease liabilities
 
$
122,345
   
$
120,119
 

Lease expense is classified in the statements of operations based on asset use.  Total lease cost recognized on the consolidated statements of operations is as follows:

 
 
Years ended December 31,
 
 
 
2025
   
2024
   
2023
 
Lease expense
                 
Operating lease expense
 
$
28,700
   
$
29,787
   
$
27,909
 
Short-term lease expense
   
2,086
     
964
     
988
 
Variable lease expense
   
595
     
581
     
566
 
Total lease expense
 
$
31,381
   
$
31,332
   
$
29,463
 

The Company paid $28,976, $29,744, and $28,164 for its operating leases during the years ended December 31, 2025, 2024, and 2023, respectively, which are included in operating cash flows on the consolidated statements of cash flows.  The weighted-average remaining lease term for the Company's operating leases is 8.3 years and the weighted-average discount rate is 6.7% as of December 31, 2025.

The undiscounted future lease payments for the Company's operating lease liabilities are as follows:

2026
 
$
27,429
 
2027
   
24,534
 
2028
   
19,432
 
2029
   
16,390
 
2030
   
14,730
 
Thereafter
   
57,582
 

The undiscounted future lease payments presented in the table above include payments through the term of the lease, which may include periods beyond the noncancellable term.  The difference between the total payments above and the lease liability balance is due to the discount rate used to calculate lease liabilities.

Historical Timeline

Fiscal YearFiled
2025Feb 13, 2026Showing above
2024Feb 14, 2025
2023Feb 16, 2024
2022Feb 22, 2023
2021Feb 23, 2022
2020Feb 24, 2021
2019Feb 14, 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.