Note 7 - Leases

9 Months Ended

Dec. 28, 2024

Notes to Financial Statements

Lessee, Operating and Finance Leases [Text Block]

7. Leases

The Company determines whether an arrangement is a lease at inception of the agreement. Presently, the Company leases land, machinery and equipment under various operating and financing leases.

Right-of-use (“ROU”) assets represent the Company’s right to use the underlying assets for the lease term, and lease obligations represent the net present value of the Company’s obligation to make payments arising from these leases. ROU assets and lease obligations are recognized at commencement date based on the present value of lease payments over the lease term using the implicit lease interest rate or, when unknown, an incremental borrowing rate based on the information available at commencement date or April 1, 2019 for leases that commenced prior to that date. ROU assets and lease obligations for the Company’s operating and financing leases are disclosed separately in the Company’s condensed consolidated balance sheets.

Lease terms may include options to extend or terminate the lease, and the impact of these options are included in the calculation of the ROU asset and lease obligation only when the exercise of the option is at the Company’s sole discretion and it is reasonably certain that the Company will exercise that option. The Company will not separate lease and non-lease components for its leases when it is impractical to separate the two. In addition, the Company may have certain leases that have variable payments based solely on output or usage of the leased asset. These variable operating lease assets are excluded from the Company’s condensed consolidated balance sheet presentation and expensed as incurred. Leases with an initial term of 12 months or less, or short-term leases, are not recorded on the accompanying condensed consolidated balance sheets and are expensed as incurred.

The components of lease cost were as follows (in thousands): 

	Three Months Ended				Nine Months Ended
	December 28,		December 30,		December 28,			December 30,
	2024		2023		2024			2023
Lease cost:
Amortization of right-of-use assets	$	838	$	1,419	$	3,144		$	4,903
Interest on lease obligations		65		180		426			602
Finance lease cost		903		1,599		3,570			5,505
Operating lease cost		1,240		1,919		4,514			6,077
Short-term lease cost		1,593		1,118		7,159			4,995
Total lease cost	$	3,736	$	4,636	$	15,243		$	16,577
Cash paid for amounts included in the measurement of lease obligations:
Operating cash flows from finance leases					$	426		$	602
Operating cash flows from operating leases						5,330			7,880
Financing cash flows from finance leases						3,800			6,401
					$	9,556		$	14,883
Right-of-use assets obtained in exchange for new finance lease obligations					$	-		$	106
Right-of-use assets obtained in exchange for new operating lease obligations					$	2,389		$	4,162
Right-of-use assets derecognized upon early termination of finance leases					$	20		$	598
Right-of-use assets derecognized upon early termination of operating leases					$	8,096		$	1,794
Weighted-average lease term (years):
Financing leases						4.0			4.5
Operating leases						4.2			4.6
Weighted-average discount rate (percentage):
Financing leases						4.1	%		3.9	%
Operating leases						5.0	%		4.7	%

Undiscounted future lease payments under non-cancelable operating and financing leases, along with a reconciliation of undiscounted cash flows to operating and financing lease obligations, respectively, as of December 28, 2024 were as follows (in thousands):

Years ending March 31:	Operating		Financing
Balance of 2025	$	362	$	1,136
2026		3,223		4,269
2027		2,268		3,218
2028		1,816		2,811
2029		1,156		1,659
2030 and thereafter		1,623		1,306
Total minimum payment required		10,448		14,399
Less interest		1,002		1,136
Present value of minimum lease payments		9,446		13,263
Amount due within one year		2,905		4,053
Long-term lease obligations	$	6,541	$	9,210