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Note 7 - Lease Obligations

3 Months Ended

Mar. 31, 2025

Note 7.

Lease Obligations

The finance leases in effect at March 31, 2025 terminate from May 2025 through November 2033 and contain guarantees of the residual value of the related equipment by us.

A summary of our lease obligations at March 31, 2025 and 2024 are as follows:

(dollars in thousands)	Three Months Ended			Three Months Ended
	March 31, 2025			March 31, 2024
Finance lease cost:
Amortization of right-of-use assets	$	219		$	123
Interest on lease liabilities		124			199
Operating lease cost		3,841			3,634
Variable lease cost		(84	)		24
Short-term lease cost		1,205			1,060
Total lease cost	$	5,305		$	5,040

Other information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases		124			199
Operating cash flows from operating leases		3,019			2,929
Financing cash flows from finance leases		180			162
Right-of-use assets obtained in exchange for new finance lease liabilities		-			810
Right-of-use assets obtained in exchange for new operating lease liabilities		2,876			-
Weighted-average remaining lease term—finance leases (in years)		4.5			3.4
Weighted-average remaining lease term—operating leases (in years)		4.2			4.9
Weighted-average discount rate—finance leases		12.8	%		13.4	%
Weighted-average discount rate—operating leases		8.4	%		10.4	%

As of March 31, 2025, and December 31, 2024, right-of-use assets of $39.7 million and $40.0 million for operating leases and $3.5 million and $4.6 million for finance leases, respectively, are included in net property and equipment in our condensed consolidated balance sheets. Operating lease right-of-use asset amortization is included in revenue equipment rentals and purchased transportation and general supplies and expenses, depending on the underlying asset, in the condensed consolidated statement of operations. Amortization of finance leased assets is included in depreciation and amortization expense in the condensed consolidated statement of operations.

Our future minimum lease payments as of March 31, 2025, are summarized as follows by lease category:

(in thousands)	*Operating*			*Finance*
2025 ⁽¹⁾	$	9,968		$	910
2026		12,914			1,212
2027		11,429			1,212
2028		5,944			930
2029		3,623			340
Thereafter		4,563			528
Total minimum lease payments	$	48,441		$	5,132
Less: amount representing interest		(6,924	)		(1,369	)
Present value of minimum lease payments	$	41,517		$	3,763
Less: current portion		(10,598	)		(772	)
Lease obligations, long-term	$	30,919		$	2,991

⁽¹⁾ Excludes the three months ended March 31, 2025.