OPERATING AND FINANCING LEASES

9 Months Ended

Mar. 31, 2025

Operating And Financing Leases

OPERATING AND FINANCING LEASES

NOTE 4 – OPERATING AND FINANCING LEASES

The Company accounts for its various operating leases in accordance with Accounting Standards Codification (ASC) 842 – “Leases”, as updated by ASU 2016-02. At the inception of a lease, the Company recognizes right-of-use lease assets and related lease liabilities measured at present value of future lease payments on its balance sheet. Lease expense is recognized on a straight-line basis over the term of the lease. The Company most common initial term varies in length from 2 to 19 years. Including renewal options negotiated with the landlord, we have a total span of 2 to 16 years at the facilities we lease. The Company reviewed its contracts with vendors and customers, determining that its right-of-use lease assets consisted of only office space operating leases. In determining the right-of-use lease assets and liabilities, the Company did recognize lease extension options which the Company feels would be reasonably exercised. Our incremental borrowing rate (“IBR”) used to discount the stream of operating lease payments is closely related to the interest rates available to the Company.

A reconciliation of operating and financing lease payments undiscounted cash flows to lease liabilities recognized as of March 31, 2025 is as follows:

Twelve Months Ending March 31,		Operating Lease Payments			Financing Lease Payments
	2026	$	5,741		$	244
	2027		5,724			224
	2028		5,685			—
	2029		5,300			—
	2030		5,203			—
	Thereafter		26,723			—
	Present value discount		(15,053	)		—
	Total lease liability	$	39,323		$	468

Weighted Average Remaining Lease Term

	For the nine months ended March 31,
	2025			2024
Operating leases - years		10.4			11.1
Finance lease - years		1.9			2.9
Weighted Average Discount Rate
Operating leases		6.5	%		6.2	%
Finance lease		3.6	%		3.6	%

The components of lease expense were as follows:

	For the nine months ended March 31,
	2025		2024
Operating lease cost	$	4,608	$	4,137
Finance lease cost:
Depreciation of leased equipment	$	162	$	150
Interest on lease liabilities		12		14
Total finance lease cost	$	174	$	164

Supplemental cash flow information related to leases was as follows:

	For the nine months ended March 31,
Cash paid for amounts included in the measurement of lease liabilities:	2025		2024
Operating cash flows from operating leases	$	4,313	$	4,096
Financing cash flows from financing leases	$	183	$	183
Right-of-use and equipment assets obtained in exchange for lease obligations:
Operating leases	$	2,320	$	1,945

(Amounts and shares in thousands, except per share amounts)