The Company, as lessee, has operating leases primarily for office space, manufacturing facilities, equipment, and vehicles. The Company determines if a contract is or contains a lease at the inception of the contract based on whether the contract conveys the right to control the use of an identified asset over a period of time in exchange for consideration. The Company considers disclosures related to its transactions as a lessor to not be material and has omitted such disclosures.

The Company elected, for all classes of underlying assets, to not separate lease and non-lease components and instead will treat the lease agreement as a single lease component for all asset classes.

Short-term operating leases, which have an initial expected term of twelve months or less, are not recorded on the consolidated balance sheet. Such fixed lease payments are recognized within the consolidated statement of earnings on a straight-line basis over the lease term. Any variable payments associated with short-term operating leases are recognized within the consolidated statement of earnings as they are incurred. The Company did not recognize any expense for such leases during the twelve months ended August 31, 2023 and 2022.

Many of the Company’s leases contain renewal or extension options. The Company includes all renewal or extension periods that it is reasonably certain to exercise at lease commencement within the measurement of the ROU asset and lease liability.

The Company’s lease portfolio consists of operating leases which are included in operating lease ROU assets and operating lease liabilities in the consolidated balance sheet. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. To calculate the present value of future lease payments, the Company uses an incremental borrowing rate that estimates a collateralized rate based on the expected term of the lease.

Lease cost and other information related to the Company’s operating leases are as follows:


	August 31,
($ in thousands)	2023			2022
Operating lease cost (cost resulting from lease payments)	$	4,114		$	5,573
Variable lease cost (cost excluded from lease payments)		536			552
Total lease cost	$	4,650		$	6,125

Operating cash outflows from operating leases	$	4,205		$	5,198
Weighted average lease term - operating leases	8.3 years			9.0 years
Weighted average discount rate - operating leases		3.5	%		3.3	%

Supplemental balance sheet information related to operating leases are as follows:


		August 31,
($ in thousands)	Classification	2023		2022
Operating lease ROU assets	Operating lease right-of-use assets	$	17,036	$	19,181

Operating lease short-term liabilities	Other current liabilities		3,028		3,159
Operating lease long-term liabilities	Operating lease liabilities		17,689		19,810
Total lease liabilities		$	20,717	$	22,969

The minimum lease payments under operating leases expiring subsequent to August 31, 2023 are as follows:


Fiscal year ending	$ in thousands
2024	$	3,715
2025		3,395
2026		3,086
2027		2,660
2028		1,913
Thereafter		9,397
Total lease payments		24,166
Less: interest		3,449
Present value of lease liabilities	$	20,717