Leases

12 Months Ended

Sep. 30, 2025

The Company leases real estate and equipment under operating lease agreements. Leases with an initial term of 12 months or less are not recorded on the balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term. For leases with terms in excess of 12 months, we record a right-of-use (“ROU”) asset and lease liability based on the present value of lease payments over the lease term. We do not have any significant leases that have not yet commenced that create significant rights and obligations for us. The Company has elected the practical expedient not to separate lease and non-lease components for all leases that qualify.

Our real estate and equipment leases often require payment of maintenance, real estate taxes and insurance. These costs are generally variable and based on actual costs incurred by the lessor. These amounts are not included in the consideration of the contract when determining the ROU asset and lease liability but are reflected as variable lease payments.

Most leases include one or more options to renew, with renewal terms that can extend the lease from one to ten or more years. The exercise of the lease renewal option is typically at our sole discretion. If it is reasonably certain that we will exercise the option to renew, the period covered by the options are included in the lease term and are recognized as part of our ROU assets and lease liabilities. Certain leases include the option to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, which includes renewal options reasonably certain to be exercised. As of September 30, 2025, our weighted-average lease term on operating leases was 8.7 years.

Certain of our lease agreements include rental payments based on percentage of retail sales over contractual levels and others include rental payments adjusted periodically based on index rates. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

When available, the implicit rate is utilized to discount lease payments to present value; however, none of our leases provide a readily determinable implicit rate, therefore we use our incremental borrowing rate to discount the lease payments based on information available at lease commencement. The incremental borrowing rate represents an estimate of the interest rate we would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of the lease. As of September 30, 2025, our weighted average discount rate on operating leases was 5.7%.

The following table provides certain information related to lease costs for operating leases:


	For the Years Ended September 30,
($ in thousands)	2025		2024		2023
Operating lease cost	$	24,675	$	23,336	$	21,332
Short-term and variable lease cost	8,265		6,415		6,062
	$	32,940	$	29,751	$	27,394

The following table presents supplemental cash flow information for leases:


	For the Years Ended September 30,
($ in thousands)	2025		2024		2023
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows from operating leases	$	17,652	$	17,168	$	20,704
Right-of-use assets obtained in exchange for new operating lease liabilities	$	7,801	$	20,330	$	27,128

The following table provides the maturities of our operating lease liabilities as of September 30, 2025:


($ in thousands)	Operating Leases
Year ending September 30,
2026	$	23,233
2027	22,196
2028	22,292
2029	19,962
2030	17,247
Thereafter	65,440
Total minimum lease payments	170,370
Less:
Present value adjustment	(37,778)
Operating lease liabilities	$	132,592