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Leases

3 Months Ended

Dec. 31, 2024

NOTE 4: LEASES

We determine if a contract contains a lease at inception. Our lease portfolio consists primarily of operating leases for pawn store locations and corporate offices with lease terms ranging from three to ten years and finance leases for vehicles with lease terms ranging from two to five years.

The table below presents balances of our lease assets and liabilities and their balance sheet locations for both operating and financing leases:


(in thousands)	Balance Sheet Location	December 31, 2024		December 31, 2023		September 30, 2024
Lease assets:
Operating lease right-of-use assets	Right-of-use assets, net	$	227,810	$	231,103	$	226,602
Financing lease assets	Other assets, net	1,340		2,124		1,559
Total lease assets		$	229,150	$	233,227	$	228,161




Lease liabilities:
Current:
Operating lease liabilities	Operating lease liabilities, current	$	57,900	$	57,980	$	58,998
Financing lease liabilities	Accounts payable, accrued expenses and other current liabilities	556		572		570
Total current lease liabilities		$	58,456	$	58,552	$	59,568

Non-current:
Operating lease liabilities	Operating lease liabilities	$	182,228	$	188,475	$	180,616
Financing lease liabilities	Other long-term liabilities	907		1,644		1,110
Total non-current lease liabilities		$	183,135	$	190,119	$	181,726
Total lease liabilities		$	241,591	$	248,671	$	241,294

The table below provides major components of our lease costs:


	Three Months Ended December 31,
(in thousands)		2024		2023

Operating lease cost:
Operating lease cost *		$	19,969	$	19,066
Variable lease cost		3,293		4,215
Total operating lease cost		$	23,262	$	23,281

Financing lease cost:
Amortization of financing lease assets		$	139	$	151
Interest on financing lease liabilities		44		65
Total financing lease cost		$	183	$	216
Total lease cost		$	23,445	$	23,497

* Includes a reduction for sublease rental income of $0.6 million and $1.1 million for the three months ended December 31, 2024 and 2023, respectively.

Lease expense is recognized on a straight-line basis over the lease term with variable lease expense recognized in the period in which the costs are incurred. The components of lease expense are included in “Store expenses” and “General and administrative” under operating expenses, based on the underlying lease use. Cash paid for operating leases was $20.0 million and $20.3 million for the three months ended December 31, 2024 and 2023, respectively. Cash paid for principal and interest on finance leases was $0.1 million and less than $0.1 million, respectively, for the three months ended December 31, 2024 and $0.1 million and $0.1 million, respectively, for the three months ended December 31, 2023.

The weighted-average term and discount rates for leases are as follows:


	Three Months Ended December 31,
	2024		2023

Weighted-average remaining lease term (years):
Operating leases	5.02		4.86
Financing leases	2.80		3.42

Weighted-average discount rate:
Operating leases	8.40	%	8.53	%
Financing leases	11.14	%	11.14	%

As of December 31, 2024, maturities of lease liabilities under ASC 842 by fiscal year were as follows:


(in thousands)	Operating Leases		Financing Leases
Remaining 2025	$	57,021	$	490
Fiscal 2026	68,806		702
Fiscal 2027	54,798		453
Fiscal 2028	39,612		43
Fiscal 2029	26,082		2
Thereafter	49,919		—
Total lease liabilities	$	296,238	$	1,690
Less: portion representing imputed interest	56,110		227
Total net lease liabilities	$	240,128	$	1,463
Less: current portion	57,900		556
Total long-term net lease liabilities	$	182,228	$	907

We recorded $18.2 million and $9.3 million in non-cash additions to our operating right-of-use assets and lease liabilities for the three months ended December 31, 2024 and 2023, respectively. We recorded no non-cash finance lease additions for the three months ended December 31, 2024 and $0.1 million for the three months ended December 31, 2023.

Leases