Note 2 - Leases

9 Months Ended

Dec. 31, 2019

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

2. Leases:

As discussed in Note 1, the Company adopted the new leasing standard using the modified retrospective approach with an effective date of April 1, 2019. Prior year financial statements were not recast under the new standard and, therefore, those amounts are not presented below. We elected the package of transition provisions available for expired or existing contracts, which allowed us to carry forward our historical assessments of (1) whether contracts are or contain leases, (2) lease classification and (3) initial direct costs.

The Company’s operating leases consist of automobiles, machinery and equipment, and real estate, including office, storage and parking spaces. The duration of these leases range from 1 to 15 years. The Company has no financing lease arrangements. For leases with terms greater than 12 months, the Company recorded the related right-of-use asset and lease liability at the present value of lease payments over the term. Leases with a term 12 months or less at inception are not recorded on our Consolidated Balance Sheet and are expensed on a straight-line basis over the lease term in our Consolidated Statement of Operations. Some of our leases contain variable rental escalation clauses which are recognized when incurred. Additionally, some of our leases contain renewal options and/or termination options that are factored into the determination of lease payments and lease terms when it is reasonably certain that the Company will exercise these options. The Company recognizes lease expense for these leases on a straight-line basis over the lease term. For leases beginning in fiscal year 2020 and later, we account for lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) separately from the non-lease components (e.g., common area maintenance costs).

When available, we use the rate implicit in the lease to discount lease payments to present value; however, most of our leases do not provide a readily determinable implicit rate. Therefore, we must estimate our incremental borrowing rate to discount the lease payments based on information available at lease commencement. Our incremental borrowing rate is based on a credit-adjusted risk-free rate at commencement date, which best approximates a secured rate over a similar term of lease.

The following table presents our lease balances:

	Classification on the Balance Sheet	As of December 31, 2019
Assets
Operating lease assets	Other assets	$	20,525
Liabilities
Current
Operating	Accrued expenses	$	5,769
Noncurrent
Operating	Other liabilities		14,592
Total lease liabilities		$	20,361

The following table presents our lease costs for operating leases:

	Three months ended		Nine months ended
	December 31, 2019		December 31, 2019
Operating lease cost	$	1,384	$	3,969
Short-term lease cost		75		784
Variable lease cost		444		1,333
Total lease cost	$	1,903	$	6,086

The Company paid $2,019 and $6,110 for its operating leases in the three and nine months ended December 31, 2019, respectively which are included in operating cash flows on the consolidated statement of cash flows. The weighted-average remaining lease term for the Company’s operating leases is 4.6 years and the weighted-average discount rate is 3.25% as of December 31, 2019.

The following table reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the operating lease liabilities on the balance sheet as of December 31, 2019:

Fiscal Year Ending
2020	$	1,624
2021		6,957
2022		5,475
2023		2,765
2024		1,592
Thereafter		3,625
Total operating lease payments	$	22,038
Less imputed interest		1,677
Total operating lease liabilities	$	20,361

As of April 1, 2019, the Company had the following future minimum lease payments under non-cancelable leases prior to the adoption of the new lease standard:

Fiscal Year Ending
2020	$	6,642
2021		4,742
2022		3,218
2023		2,372
2024		445
Thereafter		1,856
Total operating lease payments	$	19,275