The Company determines if an arrangement is a lease at inception. The Company has leases for manufacturing facilities, distribution centers, warehouses, office space and equipment, with remaining lease terms of one to eleven years. Certain of these leases include options to extend the lease for up to five years, and some include options to terminate the lease early. Leases with an initial term of 12 months or less are not recorded on the statement of financial position; the Company recognizes lease expense for these short-term leases on a straight-line basis over the lease term. Operating leases with an initial term greater than 12 months are included in Right of use asset – operating leases (“ROU assets”), Operating lease liability – short term, and Operating lease liability – long term and finance leases are included in Property, plant and equipment, Finance lease liability – short term, and Finance lease liability – long term in the Condensed Consolidated Statements of Financial Position (Unaudited).

The ROU assets represent the right to use an underlying asset for the lease term and the lease liabilities represent the obligation to make lease payments. ROU assets and lease liabilities are recognized at commencement date based on the present value of the lease payments over the lease term. When leases do not provide an implicit rate, the Company’s incremental borrowing rate is used, which is then applied at the portfolio level, based on the information available at commencement date in determining the present value of lease payments. The Company has also elected not to separate lease and non-lease components. The lease terms include options to extend or terminate the lease when it is reasonably certain the option will be exercised. Lease expense is recognized on a straight-line basis over the lease term.

Amounts included in the Condensed Consolidated Statements of Financial Position (Unaudited) related to leases include:


		June 30,		December 31,
	Classification	2025		2024
Assets:
Operating lease assets	Right of use asset - operating leases	$	26,816	$	30,561
Finance lease assets	Property, plant and equipment, net		7,556		7,927
Total lease assets		$	34,372	$	38,488

Liabilities:
Current	Operating lease liability - short-term	$	6,396	$	6,597
Long-term	Operating lease liability - long-term		20,306		23,700
Total operating lease liabilities			26,702		30,297
Current	Finance lease liability - short-term		633		621
Long-term	Finance lease liability - long-term		7,673		7,994
Total finance lease liabilities			8,306		8,615
Total lease liabilities		$	35,008	$	38,912

The components of lease expense include:


		For the Quarter Ended June 30,				For the Six Months Ended June 30,
Lease Cost	Classification	2025		2024		2025		2024
Operating lease cost (1) (2)	Cost of sales	$	1,838	$	3,617	$	3,628	$	5,349
Operating lease cost (1) (3)	Selling, general and administrative expenses		2,468		967		3,455		1,931
Finance lease cost
Amortization expense	Cost of sales		186		186		371		371
Interest expense on lease liabilities	Interest expense, net		76		82		153		165
Total lease cost		$	4,568	$	4,852	$	7,607	$	7,816

(1)

Includes short-term leases and variable lease costs, which are immaterial

(2)

Operating lease costs included in Cost of sales for the quarter and six months ended June 30, 2024, includes a $1.8 million termination charge related to exiting an idled lease facility, as described in Note 4

(3)

Operating lease costs included in Selling, general and administrative for the quarter and six months ended June 30, 2025 include $1.6 million in termination charges related to exiting idled lease facilities, as described in Note 4

Supplemental cash flow information related to leases was as follows:


	For the Six Months Ended June 30,
Supplemental Cash Flow Information	2025		2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	5,721	$	4,129
Operating cash flows from finance leases	$	153	$	165
Financing cash flows from finance leases	$	309	$	292
Right-of-use assets obtained in exchange for new lease liabilities:
Operating leases	$	1,035	$	4,761
Finance leases	$	—	$	—


Lease Term and Discount Rate	June 30, 2025			December 31, 2024
Weighted-average remaining lease term (years):
Operating leases		4.64			4.93
Finance leases		10.51			11.00
Weighted-average discount rate:
Operating leases		6.2	%		6.3	%
Finance leases		3.7	%		3.7	%


Maturity of Lease Liabilities - As of June 30, 2025	Operating Leases			Finance Leases			Total
2025 (1)	$	3,939		$	462		$	4,401
2026		7,684			924			8,608
2027		6,465			945			7,410
2028		4,900			950			5,850
2029		3,343			950			4,293
After 2029		4,018			5,758			9,776
Total lease payments		30,349			9,989			40,338
Less: interest		(3,647	)		(1,683	)		(5,330	)
Present value of lease liabilities	$	26,702		$	8,306		$	35,008

(1)

Represents amounts due in 2025 after June 30, 2025