LEASES
Nature of the Company’s Leases - The Company has operating and finance leases for plants, yards, corporate offices, tractors, trailers and other equipment. The Company’s leases have remaining terms of less than one year to 12 years. A portion of the Company’s real estate leases include an option to extend the leases for up to 5 years. The
Company has included renewal options which are reasonably certain to be exercised in its right-of-use assets and lease liabilities. The Company’s lease payments are generally fixed.
Supplemental balance sheet information related to leases as of the periods presented were as follows:
| | | | | | | | | | | | | | | | | | | | |
| (Amounts in thousands) | | Balance Sheet Classification | | 2025 | | 2024 |
| Operating leases | | | | | | |
| Right-of-use assets | | Other assets | | $ | 68,826 | | | $ | 53,807 | |
| Current lease liabilities | | Other accrued liabilities | | 19,456 | | | 15,715 | |
| Non-current lease liabilities | | Other liabilities | | 48,781 | | | 39,071 | |
| Total operating lease liabilities | | | | $ | 68,237 | | | $ | 54,786 | |
| Finance leases | | | | | | |
| Right-of-use assets | | Property, plant and equipment | | 159,553 | | | 78,068 | |
| Current lease liabilities | | Current maturities of finance lease obligations | | 33,143 | | | 18,015 | |
| Non-current lease liabilities | | Long-term finance lease obligations | | 131,000 | | | 61,661 | |
| Total finance lease liabilities | | | | $ | 164,143 | | | $ | 79,676 | |
| | | | | | | |
| Weighted average lease term (in years): | | | | |
| Operating leases | | | | 4.74 | | 4.77 |
| Finance leases | | | | 5.04 | | 4.75 |
| Weighted average discount rate: | | | | | | |
| Operating leases | | | | 5.71 | % | | 5.27 | % |
| Finance leases | | | | 6.38 | % | | 5.85 | % |
Lease Cost - The components of lease cost for the years ended March 31, 2025, 2024, and 2023 were:
| | | | | | | | | | | | | | | | | | | | |
| (Amounts in thousands) | Income Statement Classification | 2025 | | 2024 | | 2023 |
| Operating lease cost | | | | | | |
| Operating lease cost | Cost of goods sold | $ | 20,470 | | | $ | 17,325 | | | $ | 15,163 | |
| Operating lease cost | Selling, general and administrative | 1,691 | | | 1,562 | | | 1,322 | |
| Short-term lease cost | Cost of goods sold | 6,237 | | | 8,856 | | | 9,467 | |
| Total operating lease cost | | $ | 28,398 | | | $ | 27,743 | | | $ | 25,952 | |
| Finance lease cost | | | | | | |
| Amortization of right-of-use assets | Cost of goods sold | 27,974 | | | 13,707 | | | 7,252 | |
| Amortization of right-of-use assets | Selling, general and administrative | 820 | | | 820 | | | 880 | |
| Interest on lease liabilities | Interest expense | 7,666 | | | 2,833 | | | 586 | |
| Total finance lease cost | | $ | 36,460 | | | $ | 17,360 | | | $ | 8,718 | |
Supplemental cash flow information related to leases for the periods presented were as follows:
| | | | | | | | | | | | | | | | | |
| (Amounts in thousands) | 2025 | | 2024 | | 2023 |
| Cash paid for amounts included in the measurement of lease liabilities: | | | | | |
| Operating cash flows used for operating leases | $ | 22,161 | | | $ | 18,887 | | | $ | 16,485 | |
| Operating cash flows used for finance leases | 7,013 | | | 2,726 | | | 729 | |
| Financing cash flows used for finance leases | 25,487 | | | 12,145 | | | 7,686 | |
| Right-of-use assets obtained in exchange for lease obligations: | | | | | |
| Operating leases | 26,286 | | | 20,511 | | | 13,735 | |
Finance leases | 110,198 | | | 53,241 | | | 32,463 | |
The following is a schedule by year of future minimum lease payments on a rolling twelve-month basis under operating and finance leases and the present value of the net minimum lease payments as of March 31, 2025:
| | | | | | | | | | | |
| (Amounts in thousands) | Operating Leases | | Finance Leases |
| Year 1 | $ | 22,720 | | | $ | 44,981 | |
| Year 2 | 16,765 | | | 42,923 | |
| Year 3 | 12,160 | | | 37,354 | |
| Year 4 | 8,876 | | | 27,698 | |
| Year 5 | 7,456 | | | 22,151 | |
| Thereafter | 9,482 | | | 26,105 | |
| Total minimum lease payments | $ | 77,459 | | | $ | 201,212 | |
| Less: amount representing interest | 9,222 | | | 37,069 | |
| Present value of net minimum lease payments | $ | 68,237 | | | $ | 164,143 | |
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.