Leases

12 Months Ended

Jan. 03, 2026

(13)

Leases

Operating Leases and Finance Lease. We determine whether an arrangement is a lease at inception. We have operating leases and had a finance lease for certain of our manufacturing facilities, distribution centers, warehouse and storage facilities, machinery and equipment, and office equipment. Our leases have remaining lease terms of one year to seven years, some of which include options to extend the lease term for up to ten years, and some of which include options to terminate the lease within one year. We consider these options in determining the lease term used to establish our right-of use assets and lease liabilities. During the third quarter of 2025, we made the final payment related to our only finance lease. As of January 3, 2026, we did not have any finance lease right-of-use assets or finance lease liabilities.

Operating leases and a finance lease are included in the accompanying consolidated balance sheets in the following line items (in thousands):


	January 3,			December 28,
	2026			2024
Right-of-use assets:
Operating lease right-of-use assets	$	50,983		$	55,431
Finance lease right-of-use assets		—			773
Total lease right-of-use assets	$	50,983		$	56,204

Operating lease liabilities:
Current portion of operating lease liabilities	$	16,697		$	17,963
Long-term operating lease liabilities, net of current portion		34,636			37,697
Total operating lease liabilities	$	51,333		$	55,660

Finance lease liabilities:
Current portion of finance lease liabilities	$	—		$	726
Long-term finance lease liabilities, net of current portion		—			—
Total finance lease liabilities	$	—		$	726

During the second quarter of 2025, we entered into an operating lease agreement for new corporate headquarters in Parsippany, New Jersey. The lease had not yet commenced as of January 3, 2026 and therefore the operating lease right-of-use assets and the operating lease liabilities are not recorded on our consolidated balance sheet as of January 3, 2026. This operating lease commenced during the first quarter of 2026, with a lease term of 15.67 years and total undiscounted lease payments of $27.3 million.

The following table shows supplemental information related to leases (in thousands):


	Fiscal 2025			Fiscal 2024		Fiscal 2023
Operating cash flow information:
Cash paid for amounts included in the measurement of operating lease liabilities	$	20,023		$	19,795	$	18,678
Cash paid for amounts included in the measurement of finance lease liabilities	$	732		$	1,099	$	1,099

The components of operating lease costs were as follows:
Cost of goods sold	$	13,200		$	12,548	$	11,852
Selling, general and administrative expenses		6,952			6,839		6,909
Total operating lease costs	$	20,152		$	19,387	$	18,761

The components of finance lease costs were as follows:
Depreciation of finance right-of-use assets	$	773		$	1,058	$	1,058
Interest on finance lease liabilities		6			30		54
Total finance lease costs	$	779		$	1,088	$	1,112

Total net lease costs	$	20,931		$	20,475	$	19,873

Total rent expense was $21.6 million, $20.6 million and $20.5 million, including the operating lease costs of $20.2 million, $19.4 million and $18.8 million stated above, for fiscal 2025, 2024 and 2023, respectively.

Because our operating leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We have lease agreements that contain both lease and non-lease components. With the exception of our real estate leases, we account for our leases as a single lease component.

The following table shows the weighted average lease term and weighted average discount rate for our ROU assets:


	January 3,		December 28,
	2026		2024
Weighted average remaining lease term (years)
Operating leases		4.5		4.3
Finance lease		—		0.7
Weighted average discount rate
Operating leases		4.35%		3.77%
Finance lease		—		2.30%

As of January 3, 2026, the maturities of lease liabilities were as follows (in thousands):


	Operating Leases		Finance Lease		Total Maturities of Lease Liabilities
Fiscal year:
2026	$	18,514	$	—	$	18,514
2027		14,684		—		14,684
2028		9,229		—		9,229
2029		4,341		—		4,341
2030		2,182		—		2,182
Thereafter		7,897		—		7,897
Total undiscounted future minimum lease payments		56,847		—		56,847
Less: Imputed interest		(5,514)		—		(5,514)
Total present value of future lease liabilities	$	51,333	$	—	$	51,333