Note E - Leases

3 Months Ended

Jun. 30, 2022

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

 NOTE E — LEASES

During the three months ended June 30, 2022, the Company was assigned an operating lease associated with the real property and leasehold improvements for the Granite City, IL facility acquired from Plateplus pursuant to the Transaction. The current lease expires August 31, 2023 but contains a 20 year extension option in favor of the Company which the Company expects to exercise. The lease calls for quarterly rental payments of $18,832. The Company recognized an initial right-of-use ("ROU") asset and lease liability of $1,237,097 during the June 30, 2022 quarter related to this lease. The anticipated 20 year extension of this lease is included in the ROU asset and lease liability calculation. The Company’s lease of its office space in Longview, Texas is the only other operating lease included in the Company's ROU assets and lease liabilities. The lease calls for monthly rent payments of $4,878 and expires on April 30, 2024. The Company’s other operating leases for items such as IT equipment and storage space are either short-term in nature or immaterial.

In October 2019, the Company received a new heavy-duty forklift under a 5-year finance lease arrangement with a financed amount of $518,616 and a monthly payment of $9,074.

The components of expense related to leases for the three months ended June 30, 2022 and 2021 are as follows:

	Three Months Ended
	June 30,
	2022		2021
Finance lease – amortization of ROU asset	$	25,983	$	25,487
Finance lease – interest on lease liability		1,240		1,736
Operating lease expense		27,188		14,634
	$	54,411	$	41,857

The following table illustrates the balance sheet classification for ROU assets and lease liabilities as of June 30, 2022 and March 31, 2022:

	June 30, 2022		March 31, 2022		Balance Sheet Classification
Assets
Operating lease right-of-use asset	$	1,330,241	$	113,168	Operating lease right-of-use asset
Finance lease right-of-use asset		449,465		455,948	Property, plant & equipment
Total right-of-use assets	$	1,779,706	$	569,116
Liabilities
Operating lease liability, current	$	98,289	$	52,270	Accrued expenses
Finance lease liability, current		105,195		104,689	Current portion of finance lease
Operating lease liability, non-current		1,244,409		60,898	Other non-current liabilities
Finance lease liability, non-current		134,380		160,869	Other non-current liabilities
Total lease liabilities	$	1,582,273	$	378,726

As of June 30, 2022, the weighted-average remaining lease term was 19.7 years for operating leases and 2.3 years for finance leases. The weighted average discount rate was 2.8% for operating leases and 1.9% for finance leases.

Maturities of lease liabilities as of June 30, 2022 were as follows:

	Operating Leases			Finance Leases
Fiscal 2023 (remainder of fiscal year)		100,397			81,669
Fiscal 2024		133,863			108,892
Fiscal 2025		80,205			54,446
Fiscal 2026		75,327			—
Fiscal 2027 and beyond		1,311,941			—
Total undiscounted lease payments	$	1,701,733		$	245,007
Less: imputed interest		(359,035	)		(5,432	)
Present value of lease liability	$	1,342,698		$	239,575