Note 11 - Leases and Purchase Commitments

12 Months Ended

Jun. 30, 2022

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

NOTE 11 — LEASES AND PURCHASE COMMITMENTS

Purchase commitments of the Company totaled $65.6 million as of June 30, 2022.

The Company leases certain manufacturing facilities along with a small office space, a company vehicle, several forklifts, several small tooling items and various items of office equipment. The Company also acquired buildings, machinery and forklift leases with the acquisition of JSI, as well as one sublease. All but two of the Company’s leases are operating. Leases have a remaining term of one to seven years, some of which have an option to renew. The Company does not assume renewals in determining the lease term unless the renewals are deemed reasonably certain. The lease agreements do not contain any material residual guarantees or material variable lease payments.

The Company has periodically entered into short-term operating leases with an initial term of twelve months or less. The Company elected not to record these leases on the balance sheet. The rent expense for these leases was immaterial for fiscal years 2022 and 2021.

The Company has certain leases that contain lease and non-lease components and has elected to utilize the practical expedient to account for these components together as a single lease component.

Lease expense is recognized on a straight-line basis over the lease term. The Company used its incremental borrowing rate when determining the present value of lease payments.

(In thousands)	2022		2021
Operating lease cost	$	3,483	$	2,428
Financing lease cost:
Amortization of right of use assets		295		291
Interest on lease liabilities		80		91
Variable lease cost		87		10
Sublease income		-		(43	)
Total lease cost	$	3,945	$	2,777

Supplemental Cash Flow Information
(in thousands)	2022		2021
Cash flows from operating leases
Fixed payments - operating lease cash flows	$	3,576	$	2,412
Liability reduction - operating cash flows	$	3,064	$	1,983
Cash flows from finance leases
Interest - operating cash flows	$	80	$	91
Repayments of principal portion - financing cash flows	$	268	$	239

Operating Leases:	June 30, 2022			June 30, 2021
Total operating right-of-use assets	$	8,664		$	11,579
Accrued expenses (Current liabilities)	$	1,274		$	1,424
Long-term operating lease liability		8,240			10,890
Total operating lease liabilities	$	9,514		$	12,314
Weighted Average remaining Lease Term (in years)		3.05			3.93
Weighted Average Discount Rate		4.81	%		4.81	%

Finance Leases:	June 30, 2022			June 30, 2021
Buldings under finance leases	$	2,033		$	2,033
Equipment under finance leases		11			30
Accumulated depreciation		(634	)		(339	)
Total finance lease assets, net	$	1,410		$	1,724
Accured expenses (Current liabilities)		275		$	263
Long-term finance lease liability		1,246			1,521
Total finance lease liabilities	$	1,521		$	1,784
Weighted Average remaining Lease Term (in years)		4.80			5.78
Weighted Average Discount Rate		4.86	%		4.86	%

Maturities of Lease Liability:
	Operating Lease Liabilities			Finance Lease Liabilities			Operating Subleases			Net Lease Commitments
2023	$	3,738		$	343		$	(377	)	$	3,704
2024		3,285			337			(377	)		3,245
2025		2,136			362			(31	)		2,467
2026		835			362			-			1,197
2027		215			302			-			517
Thereafter		4			-			-			4
Total lease payments	$	10,213		$	1,706		$	(785	)	$	11,134
Less: Interest		(699	)		(185	)					(884	)
Present Value of Lease Liabilities	$	9,514		$	1,521					$	10,250