Note K - Leases

3 Months Ended

Mar. 31, 2024

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

Note K – Leases

We have operating leases for office, manufacturing and distribution facilities as well as for certain equipment. Our leases have remaining lease terms of 1 year to 8 years. As of March 31, 2024, the Company has not entered into any lease arrangements classified as a finance lease.

We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current operating lease liabilities and operating lease liabilities on our consolidated balance sheet. The Company has elected an accounting policy to not recognize short-term leases (one year or less) on the balance sheet. The Company also elected the package of practical expedients which applies to leases that commenced before the adoption date. By electing the package of practical expedients, the Company did not need to reassess the following; whether any existing contracts are or contain leases, the lease classification for any existing leases and initial direct costs for any existing leases.

ROU assets and operating lease liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. When the implicit rate of the lease is not provided or cannot be determined, we use our incremental borrowing rate based on the information available at the commencement date to determine the present value of future payments. Lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise those options. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Components of lease expense and other information is as follows:

	Three Months Ended
All Amounts in Thousands	March 31, 2024			March 31, 2023
Lease Expense
Operating Lease Cost	$	375		$	374
Short-term Lease Cost		357			612
Variable Lease Cost		165			129
Total Operating Lease Cost	$	897		$	1,115
Operating Lease – Operating Cash Flows	$	255		$	245
New ROU Assets – Operating Leases (non-cash)	$	-		$	-
Weighted Average Remaining Lease Term – Operating Leases (years)		7.89			8.79
Weighted Average Discount Rate – Operating Leases		5.20	%		5.05	%

Future minimum lease payments under non-cancellable leases as of March 31, 2024 were as follows:

All Amounts in Thousands
Year 1	$	1,111
Year 2		1,445
Year 3		1,401
Year 4		1,314
Year 5		1,074
Thereafter		4,257
Total future minimum lease payments		10,602
Less imputed interest		(1,919	)
Total	$	8,683
Reported as of March 31, 2024
Current operating lease liabilities		1,055
Long-term operating lease liabilities		7,628
Total	$	8,683