Leases

3 Months Ended

Jul. 31, 2024

Leases

Leases

Note 4 – Leases

We lease certain office, manufacturing, laboratory and warehouse space located in Orange County, California under operating lease agreements. Our leased facilities have original lease terms ranging from 7 to 12 years, contain multi-year renewal options, and scheduled rent increases of 3% on either an annual or biennial basis. Multi-year renewal options were included in determining the right-of-use asset and lease liability for each of our leases as we considered it reasonably certain that we would exercise such renewal options. In addition, certain of our leases provide for periods of free rent, lessor improvements and tenant improvement allowances, of which certain of these improvements have been classified as leasehold improvements and/or are being amortized over the shorter of the estimated useful life of the improvements or the remaining life of the lease.

Certain of our operating facility leases require us to pay property taxes, insurance and common area maintenance. While these payments are not included as part of our lease liabilities, they are recognized as variable lease cost in the period they are incurred.

We also lease certain manufacturing equipment under finance lease agreements that have terms ranging from 5 to 7 years.

The components of our lease costs are summarized as follows (in thousands): 

	Three Months Ended July 31,
	2024		2023
Operating leases	$	1,133	$	1,140
Variable leases		463		351
Short-term leases		31		36
Finance leases:
Amortization of right-of-use assets		127		54
Interest on lease liabilities		137		27
Total lease costs	$	1,891	$	1,608

Supplemental consolidated balance sheet and other information related to our leases were as follows (in thousands, expect weighted average data): 

Leases	Classification	July 31, 2024		April 30, 2024
Assets
Operating	Operating lease right-of-use assets	$	40,741	$	41,157
Finance	Property and equipment, net		8,984		9,270
Total leased assets		$	49,725	$	50,427
Liabilities
Current:
Operating	Current portion of operating lease liabilities	$	1,399	$	1,354
Finance	Other current liabilities		1,472		1,450
Non-current:
Operating	Operating lease liabilities, less current portion		43,971		44,336
Finance	Finance lease liabilities, less current portion		6,725		7,101
Total lease liabilities		$	53,567	$	54,241

Weighted average remaining lease term (years):
Operating leases	15.5	15.7
Finance lease	5.6	5.8
Weighted average discount rate:
Operating leases	6.0%	6.0%
Finance lease	6.5%	6.5%

Supplemental cash flow information related to our leases were as follows (in thousands): 

	Three Months Ended July 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	973	$	1,119
Operating cash flows from finance leases		141		27
Financing cash flows from finance leases		350		130
Non-cash transaction:
Unpaid finance lease obligation		263		–

As of July 31, 2024, the maturities of our lease liabilities, which includes those derived from lease renewal options that we considered it reasonably certain that we would exercise, were as follows (in thousands): 

Fiscal Year Ending April 30,	Operating Leases			Finance Leases			Total
2025 (remaining period)	$	3,056		$	1,473		$	4,529
2026		4,167			1,963			6,130
2027		4,199			1,754			5,953
2028		4,036			1,334			5,370
2029		4,147			1,334			5,481
Thereafter		52,272			2,002			54,274
Total lease payments		71,877			9,860			81,737
Less: imputed interest		(26,507	)		(1,663	)		(28,170	)
Total lease liabilities	$	45,370		$	8,197		$	53,567