LEASES

12 Months Ended

Dec. 31, 2025

We lease office and retail space, warehouse and distribution facilities, land, vehicles, and equipment. We determine if an agreement is or contains a lease at inception. Leases with an initial term of 12 months or less are not recorded on the balance sheet.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and liabilities are based on the estimated present value of lease payments over the lease term and are recognized at the lease commencement date.

As most of our leases do not provide an implicit rate, we use our estimated incremental borrowing rate in determining the present value of lease payments. The estimated incremental borrowing rate is derived from information available at the lease commencement date.

Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. A limited number of our lease agreements include rental payments adjusted periodically for inflation. Our lease agreements generally do not contain residual value guarantees or material restrictive covenants.

For real estate, equipment and vehicles that support selling, marketing and general administrative activities the Company accounts for the lease and non-lease components as a single lease component. These asset categories comprise the majority of our leases. The lease and non-lease components of real estate and equipment leases supporting production activities are not accounted for as a single lease component. Consideration for such contracts is allocated to the lease component and non-lease components based upon relative standalone prices either observable or estimated if observable prices are not readily available.

The components of lease expense were as follows:


Lease expense	Classification	2025		2024		2023
Operating lease cost	Cost of sales or SM&A (1)	$	62,033	$	53,141	$	48,577
Finance lease cost:
Amortization of ROU assets	Depreciation and amortization (1)	8,598		9,017		8,140
Interest on lease liabilities	Interest expense, net	4,549		4,702		4,593
Net lease cost (2)		$	75,180	$	66,860	$	61,310

(1)Supply chain-related amounts were included in cost of sales.

(2)Net lease cost does not include short-term leases, variable lease costs or sublease income, all of which are immaterial.

Information regarding our lease terms and discount rates were as follows:


	2025		2024
Weighted-average remaining lease term (years)
Operating leases	10.2		12.4
Finance leases	25.2		25.9

Weighted-average discount rate
Operating leases	4.6	%	3.7	%
Finance leases	6.3	%	6.3	%

Supplemental balance sheet information related to leases were as follows:


Leases	Classification	2025		2024
Assets
Operating lease ROU assets	Other non-current assets	$	325,345	$	337,739

Finance lease ROU assets, at cost	Property, plant and equipment, gross	83,714		87,999
Accumulated amortization	Accumulated depreciation	(26,073)		(25,515)
Finance lease ROU assets, net	Property, plant and equipment, net	57,641		62,484

Total leased assets		$	382,986	$	400,223

Liabilities
Current
Operating	Accrued liabilities	$	49,583	$	40,636
Finance	Current portion of long-term debt	4,499		5,666
Non-current
Operating	Other long-term liabilities	285,925		304,767
Finance	Long-term debt	69,011		68,136
Total lease liabilities		$	409,018	$	419,205

The maturity of our lease liabilities as of December 31, 2025 were as follows:


	Operating leases		Finance leases		Total
2026	$	63,391	$	8,867	$	72,258
2027	61,286		6,931		68,217
2028	42,707		5,714		48,421
2029	38,761		4,381		43,142
2030	32,025		4,313		36,338
Thereafter	190,481		129,333		319,814
Total lease payments	428,651		159,539		588,190
Less: Imputed interest	93,143		86,029		179,172
Total lease liabilities	$	335,508	$	73,510	$	409,018

Supplemental cash flow and other information related to leases were as follows:


	2025		2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	59,382	$	48,757	$	45,176
Operating cash flows from finance leases	$	4,549	$	4,702	$	4,593
Financing cash flows from finance leases	$	6,328	$	6,507	$	5,381

ROU assets obtained in exchange for lease liabilities:
Operating leases	$	34,640	$	71,804	$	18,469
Finance leases	$	5,740	$	3,875	$	7,448