Note 7 -Rental Equipment

9 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Leases Disclosure [Text Block]

7. Rental Equipment

The Company leases equipment to customers which generally range from daily rentals to minimum rental periods of up to one year. All of the Company’s current leasing arrangements, which the Company acts as lessor, are classified as operating leases. The majority of the Company’s rental revenue is generated from its marine-based wireless seismic data acquisition systems.

The Company regularly evaluates the collectability of its lease receivables on a lease-by-lease basis. The evaluation primarily consists of reviewing past due account balances and other factors such as the credit quality of the customer, historical trends of the customer and current economic conditions. The Company suspends revenue recognition when the collectability of amounts due are no longer probable and concurrently records a direct write-off of the lease receivable to rental revenue and limits future rental revenue recognition to cash received. As of June 30, 2024, the Company’s trade accounts receivable included lease receivables of $2.9 million.

Rental revenue related to leased equipment for the three and nine months ended June 30, 2024, was $5.6 million and $16.5 million, respectively. Rental revenue related to leased equipment for the three and nine months ended June 30, 2023 was $12.9 million and $38.0 million, respectively.

Future minimum lease obligations due from the Company’s leasing customers on operating leases executed as of  June 30, 2024, were $3.6 million, all of which is expected to be due within the next 12 months.

Rental equipment consisted of the following (in thousands):

	June 30, 2024			September 30, 2023
Rental equipment, primarily wireless recording equipment	$	80,976		$	82,926
Accumulated depreciation		(64,069	)		(61,339	)
	$	16,907		$	21,587