Zymeworks Inc.ZYME

Zymeworks Inc. Leases Disclosure

10-KFiled Mar 2, 20262 min read
Leases
The lease for the Company’s office and laboratory spaces in Vancouver, British Columbia, which was entered into in January 2019, has an initial term expiring in February 2032, with two five-year extension options. In addition, the Company leases office spaces in Bellevue, Washington and in Redwood City, California with lease terms expiring between August 2027 and July 2029. None of the optional extension periods have been included in the determination of the right-of-use assets or the lease liabilities for operating leases as the Company did not consider it reasonably certain that the Company would exercise any such options.
The Company also leases office equipment under capital lease agreements.
The balance sheet classification of the Company’s lease liabilities was as follows:
December 31,
2025		December 31,
2024
Operating lease liabilities:
Current portion$3,471 $2,740 
Long-term portion14,796 15,738 
Total operating lease liabilities$18,267 $18,478 
Finance lease liabilities:
Current portion included in other current liabilities— 28 
Long-term portion included in other long-term liabilities— 28 
Total finance lease liabilities— 56 
Total lease liabilities$18,267 $18,534 
Weighted average remaining lease term:
Operating leases
5.2 years6.4 years
Weighted average discount rate:
Operating leases in U.S. dollars
5.9 %5.4 %
Operating leases in Canadian dollars
4.8 %4.8 %
Cash paid for amounts included in the measurement of operating lease liabilities for fixed lease payments for the year ended December 31, 2025 was $4,270 (2024: $4,152) and was included in net cash used in operating activities in the consolidated statement of cash flows. In addition, on April 4, 2024, the Company terminated its long-term facility lease in Seattle, pursuant to which the Company paid $6,075 as a termination fee.
As of December 31, 2025, the maturities of the Company’s operating lease liabilities were as follows:
Operating
leases
Within 1 year$4,285 
1 to 2 years4,015 
2 to 3 years3,658 
3 to 4 years5,362 
4 to 5 years2,709 
Thereafter2,935 
Total operating lease payments22,964 
Less:
Imputed interest(4,697)
Operating lease liabilities$18,267 
The cost components of the operating leases were as follows:
Year Ended December 31,
202520242023
Lease expenses:
Operating lease expense$3,355 $2,447 $7,292 
Variable lease expense2,257 1,969 1,637 
Termination of long-term facility lease in Seattle, net
— 1,033 — 
$5,612 $5,449 $8,929 
During the year ended December 31, 2025, the Company recognized $316 of impairment losses on its right-of-use assets (2024: nil and 2023: nil).

Historical Timeline

Fiscal YearFiled
2025Mar 2, 2026Showing above
2024Mar 5, 2025
2023Mar 6, 2024
2022Mar 7, 2023

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.

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