Leases

12 Months Ended

Dec. 31, 2024

LEASES

The Company leases certain facilities within the U.S., Europe, and Canada from which the Company manufactures vehicles and equipment and provides sales, service, and/or equipment rentals. Some of the Company’s lease agreements contain options to renew. The Company also leases vehicles and various other equipment. The Company’s lease agreements may contain lease and non-lease components, which are accounted for separately. Leases with an initial term of twelve months or less are not recorded on the Consolidated Balance Sheets.

In connection with acquisitions completed in recent years, the Company has entered into certain lease agreements for facilities owned by affiliates of the sellers. All lease agreements contain an annual rent that is considered to be market-based. Total rent paid under these arrangements was $2.0 million in 2024, $2.3 million in 2023, and $2.8 million in 2022. The Company’s total lease liabilities under these agreements were $16.2 million as of December 31, 2024 and $4.2 million as of December 31, 2023.

The increase in these lease liabilities is primarily due to the exercise of a purchase option included in the lease agreement of one of our U.S. manufacturing facilities, as discussed in the Other Finance Lease Consideration section below.

The Company determines if an arrangement is a lease at inception. Operating lease right-of-use assets represent the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental collateralized borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Implicit rates are used when readily determinable. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease payments is recognized on a straight-line basis over the respective lease term.

The following table summarizes the Company’s total operating lease costs and supplemental cash flow information arising from operating lease transactions:


(in millions of dollars)	For the Years Ended December 31,
	2024		2023		2022
Total operating lease costs (a)	$	12.9	$	12.7	$	11.7

Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	8.5		8.4		7.7

(a) Includes short-term leases and variable lease costs.

The following table summarizes the components of lease right-of-use assets and liabilities:


(in millions of dollars)	2024		2023		Affected Line Item in Consolidated Balance Sheets
Assets
Operating lease right-of-use assets (a)	$	27.8	$	21.0	Operating lease right-of-use assets
Finance lease right-of-use assets (b)	12.9		1.6		Properties and equipment, net
Total lease right-of-use assets	$	40.7	$	22.6

Liabilities
Current:
Operating leases	$	6.8	$	6.8	Current operating lease liabilities
Finance leases	12.4		0.8		Current portion of long-term borrowings and finance lease obligations
Noncurrent:
Operating leases	21.8		14.9		Long-term operating lease liabilities
Finance leases	0.5		0.8		Long-term borrowings and finance lease obligations
Total lease liabilities	$	41.5	$	23.3

(a) Right-of-use assets obtained in exchange for new operating lease liabilities was $16.9 million for the year ended December 31, 2024.

(b) Right-of-use assets obtained in exchange for new finance lease liabilities was $11.5 million for the year ended December 31, 2024.

The weighted-average remaining lease terms and discount rates of the Company’s operating leases were as follows:


	2024		2023
Weighted-average remaining lease term of operating leases	5.0 years		4.3 years
Weighted-average discount rate of operating leases	3.9	%	3.0	%

Maturities of lease liabilities as of December 31, 2024 were as follows:


(in millions of dollars)	Operating Leases		Finance Leases
2025	$	7.8	$	12.4
2026	6.7		0.3
2027	5.5		0.1
2028	4.5		0.1
2029	3.3		—
Thereafter	3.7		—
Total lease payments	31.5		12.9
Less: Imputed interest	2.9		—
Present value of lease liabilities	$	28.6	$	12.9

Other Finance Lease Considerations

In the fourth quarter of 2024, the Company provided notice to the lessor of one of its leased U.S. manufacturing facilities of its intent to exercise the $11.5 million purchase option included in the lease agreement. The Company remeasured the corresponding lease liability, adjusted the right-of-use asset, and reassessed the lease classification, resulting in a change in classification from an operating lease to a finance lease. As of December 31, 2024, the related finance lease right-of-use asset was $11.3 million and the finance lease liability was $11.5 million. The associated impact on the Company’s Consolidated Statement of Operations for the year ended December 31, 2024 was insignificant. The weighted average discount rate was 4.9%. The purchase was completed on February 10, 2025.