LEASES

3 Months Ended

Mar. 29, 2026

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 consolidated balance sheet.

Right-of-use (“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 are allocated to the lease 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 for the three months ended March 29, 2026 and March 30, 2025 were as follows:


		Three Months Ended
Lease expense	Classification	March 29, 2026		March 30, 2025
Operating lease cost	Cost of sales or SM&A (1)	$	16,382	$	14,211
Finance lease cost:
Amortization of ROU assets	Depreciation and amortization (1)	2,224		2,250
Interest on lease liabilities	Interest expense, net	1,169		1,134
Net lease cost (2)		$	19,775	$	17,595

(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:


	March 29, 2026		December 31, 2025
Weighted-average remaining lease term (years)
Operating leases	10.2		10.2
Finance leases	24.2		25.2

Weighted-average discount rate
Operating leases	4.6	%	4.6	%
Finance leases	6.2	%	6.3	%

Supplemental balance sheet information related to leases were as follows:


Leases	Classification	March 29, 2026		December 31, 2025
Assets
Operating lease ROU assets	Other non-current assets	$	312,599	$	325,345

Finance lease ROU assets, at cost	Property, plant and equipment, gross	85,056		83,714
Accumulated amortization	Accumulated depreciation	(25,987)		(26,073)
Finance lease ROU assets, net	Property, plant and equipment, net	59,069		57,641

Total leased assets		$	371,668	$	382,986

Liabilities
Current
Operating	Accrued liabilities	$	49,676	$	49,583
Finance	Current portion of long-term debt	5,213		4,499
Non-current
Operating	Other long-term liabilities	273,573		285,925
Finance	Long-term debt	70,928		69,011
Total lease liabilities		$	399,390	$	409,018

The maturities of our lease liabilities as of March 29, 2026 were as follows:


	Operating leases		Finance leases		Total
2026 (rest of year)	$	47,528	$	7,468	$	54,996
2027	61,276		8,440		69,716
2028	42,684		7,186		49,870
2029	38,739		4,510		43,249
2030	32,006		4,339		36,345
Thereafter	190,434		129,333		319,767
Total lease payments	412,667		161,276		573,943
Less: Imputed interest	89,418		85,135		174,553
Total lease liabilities	$	323,249	$	76,141	$	399,390

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


	Three Months Ended
	March 29, 2026		March 30, 2025
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	15,931	$	13,538
Operating cash flows from finance leases	1,169		1,134
Financing cash flows from finance leases	1,615		1,798

ROU assets obtained in exchange for lease liabilities:
Operating leases	$	—	$	29,501
Finance leases	4,352		62