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Leases

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Leases

Leases

The Company's portfolio of leases contains both finance and operating leases that relate to real estate and manufacturing equipment. Substantially all of the value of the Company's lease portfolio relates to the Master Lease with Store Master Funding XII, LLC (“Store”), an affiliate of Store Capital Corporation ("Store Capital") that was entered into in 2016 and amended with the American Stainless acquisition in 2019 as well as the sale of land at the Munhall facility in 2020. As of December 31, 2023, operating lease liabilities related to the master lease agreement with Store Capital totaled $30.6 million, or 94% of the total lease liabilities on the consolidated balance sheet.

During the year ended December 31, 2023, the Company entered into new operating lease agreements resulting in an additional $0.5 million of right-of-use assets and lease liabilities.

Balance Sheet Presentation

Operating and finance lease amounts from continuing operations are as follows (in thousands):

												Year Ended December 31,
Classification						Financial Statement Line Item						2023						2022
Operating lease assets						Right-of-use assets, operating leases						$	27,784					$	29,142
Finance lease assets						Property, plant and equipment, net						1,543						1,494
Current liabilities						Current portion of lease liabilities, operating leases						1,140						1,015
Current liabilities						Current portion of lease liabilities, finance leases						292						280
Non-current liabilities						Non-current portion of lease liabilities, operating leases						29,729						30,869
Non-current liabilities						Non-current portion of lease liabilities, finance leases						$	1,307					$	1,242

Total Lease Cost

Individual components of the total lease cost incurred by the Company are as follows:

			Year Ended December 31,
(in thousands)			2023						2022
Operating lease cost1			$	3,945					$	4,108
Finance lease cost:
Reduction in carrying amount of right-of-use assets			334						273
Interest on finance lease liabilities			85						36
Sublease income			(394)						(187)
Total lease cost			$	3,970					$	4,230

1Includes short term leases, which are immaterial

Reduction in carrying amounts of right-of-use assets held under finance leases is included in depreciation expense. Minimum rental payments under operating leases are recognized on a straight-line method over the term of the lease including any periods of free rent and are included in selling, general, and administrative expense on the consolidated statements of income (loss).

Maturity of Leases

The amounts of undiscounted future minimum lease payments under leases as of December 31, 2023 are as follows:

(in thousands)			Operating						Finance
2024			$	3,651					$	367
2025			3,671						361
2026			3,691						361
2027			3,765						361
2028			3,840						303
Thereafter			32,312						85
Total undiscounted minimum future lease payments			50,930						1,838
Imputed Interest			(20,061)						(239)
Total lease liabilities			$	30,869					$	1,599

Lease Term and Discount Rate

			Year Ended December 31,
			2023						2022
Weighted-average discount rate
Operating leases			8.33		%				8.27		%
Finance leases			5.92		%				2.32		%
Weighted-average remaining lease term
Operating leases			12.67 years						13.59 years
Finance leases			5.07 years						6.06 years

Leases

Leases

The Company's portfolio of leases contains both finance and operating leases that relate to real estate and manufacturing equipment. Substantially all of the value of the Company's lease portfolio relates to the Master Lease with Store Master Funding XII, LLC (“Store”), an affiliate of Store Capital Corporation ("Store Capital") that was entered into in 2016 and amended with the American Stainless acquisition in 2019 as well as the sale of land at the Munhall facility in 2020. As of December 31, 2023, operating lease liabilities related to the master lease agreement with Store Capital totaled $30.6 million, or 94% of the total lease liabilities on the consolidated balance sheet.

During the year ended December 31, 2023, the Company entered into new operating lease agreements resulting in an additional $0.5 million of right-of-use assets and lease liabilities.

Balance Sheet Presentation

Operating and finance lease amounts from continuing operations are as follows (in thousands):

												Year Ended December 31,
Classification						Financial Statement Line Item						2023						2022
Operating lease assets						Right-of-use assets, operating leases						$	27,784					$	29,142
Finance lease assets						Property, plant and equipment, net						1,543						1,494
Current liabilities						Current portion of lease liabilities, operating leases						1,140						1,015
Current liabilities						Current portion of lease liabilities, finance leases						292						280
Non-current liabilities						Non-current portion of lease liabilities, operating leases						29,729						30,869
Non-current liabilities						Non-current portion of lease liabilities, finance leases						$	1,307					$	1,242

Total Lease Cost

Individual components of the total lease cost incurred by the Company are as follows:

			Year Ended December 31,
(in thousands)			2023						2022
Operating lease cost1			$	3,945					$	4,108
Finance lease cost:
Reduction in carrying amount of right-of-use assets			334						273
Interest on finance lease liabilities			85						36
Sublease income			(394)						(187)
Total lease cost			$	3,970					$	4,230

1Includes short term leases, which are immaterial

Reduction in carrying amounts of right-of-use assets held under finance leases is included in depreciation expense. Minimum rental payments under operating leases are recognized on a straight-line method over the term of the lease including any periods of free rent and are included in selling, general, and administrative expense on the consolidated statements of income (loss).

Maturity of Leases

The amounts of undiscounted future minimum lease payments under leases as of December 31, 2023 are as follows:

(in thousands)			Operating						Finance
2024			$	3,651					$	367
2025			3,671						361
2026			3,691						361
2027			3,765						361
2028			3,840						303
Thereafter			32,312						85
Total undiscounted minimum future lease payments			50,930						1,838
Imputed Interest			(20,061)						(239)
Total lease liabilities			$	30,869					$	1,599

Lease Term and Discount Rate

			Year Ended December 31,
			2023						2022
Weighted-average discount rate
Operating leases			8.33		%				8.27		%
Finance leases			5.92		%				2.32		%
Weighted-average remaining lease term
Operating leases			12.67 years						13.59 years
Finance leases			5.07 years						6.06 years

Leases

Leases

The Company's portfolio of leases contains both finance and operating leases that relate to real estate and manufacturing equipment. Substantially all of the value of the Company's lease portfolio relates to the Master Lease with Store Master Funding XII, LLC (“Store”), an affiliate of Store Capital Corporation ("Store Capital") that was entered into in 2016 and amended with the American Stainless acquisition in 2019 as well as the sale of land at the Munhall facility in 2020. As of December 31, 2023, operating lease liabilities related to the master lease agreement with Store Capital totaled $30.6 million, or 94% of the total lease liabilities on the consolidated balance sheet.

During the year ended December 31, 2023, the Company entered into new operating lease agreements resulting in an additional $0.5 million of right-of-use assets and lease liabilities.

Balance Sheet Presentation

Operating and finance lease amounts from continuing operations are as follows (in thousands):

												Year Ended December 31,
Classification						Financial Statement Line Item						2023						2022
Operating lease assets						Right-of-use assets, operating leases						$	27,784					$	29,142
Finance lease assets						Property, plant and equipment, net						1,543						1,494
Current liabilities						Current portion of lease liabilities, operating leases						1,140						1,015
Current liabilities						Current portion of lease liabilities, finance leases						292						280
Non-current liabilities						Non-current portion of lease liabilities, operating leases						29,729						30,869
Non-current liabilities						Non-current portion of lease liabilities, finance leases						$	1,307					$	1,242

Total Lease Cost

Individual components of the total lease cost incurred by the Company are as follows:

			Year Ended December 31,
(in thousands)			2023						2022
Operating lease cost1			$	3,945					$	4,108
Finance lease cost:
Reduction in carrying amount of right-of-use assets			334						273
Interest on finance lease liabilities			85						36
Sublease income			(394)						(187)
Total lease cost			$	3,970					$	4,230

1Includes short term leases, which are immaterial

Reduction in carrying amounts of right-of-use assets held under finance leases is included in depreciation expense. Minimum rental payments under operating leases are recognized on a straight-line method over the term of the lease including any periods of free rent and are included in selling, general, and administrative expense on the consolidated statements of income (loss).

Maturity of Leases

The amounts of undiscounted future minimum lease payments under leases as of December 31, 2023 are as follows:

(in thousands)			Operating						Finance
2024			$	3,651					$	367
2025			3,671						361
2026			3,691						361
2027			3,765						361
2028			3,840						303
Thereafter			32,312						85
Total undiscounted minimum future lease payments			50,930						1,838
Imputed Interest			(20,061)						(239)
Total lease liabilities			$	30,869					$	1,599

Lease Term and Discount Rate

			Year Ended December 31,
			2023						2022
Weighted-average discount rate
Operating leases			8.33		%				8.27		%
Finance leases			5.92		%				2.32		%
Weighted-average remaining lease term
Operating leases			12.67 years						13.59 years
Finance leases			5.07 years						6.06 years

X

- References

No definition available.

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- Definition

The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 842
-SubTopic 20
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//842-20/tableOfContent

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- Definition

The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
-URI https://asc.fasb.org//842-20/tableOfContent

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The entire disclosure for sale leaseback transaction. Includes, but is not limited to, terms and conditions of transaction and gain (loss) from transaction.

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-Topic 840
-SubTopic 40
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//840-40/tableOfContent

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-Topic 842
-SubTopic 40
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-URI https://asc.fasb.org//842-40/tableOfContent

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