Leases

6 Months Ended

Mar. 31, 2022

The Company leases certain facilities and equipment under operating leases. In relation to an acquisition that was completed on October 18, 2021 (see Note 4), the Company entered into leases with third parties for certain clubs where the real estate locations were not part of the acquisition.

Total lease expense included in selling, general and administrative expenses in our unaudited condensed consolidated statements of income for the three and six months ended March 31, 2022 and 2021 is as follows (in thousands):


	Three Months Ended March 31, 2022		Three Months Ended March 31, 2021		Six Months Ended March 31, 2022			Six Months Ended March 31, 2021
Operating lease expense – fixed payments	$	1,136	$	828	$	2,267		$	1,657
Variable lease expense	233		44		567			108
Short-term equipment and other lease expense (includes $58 and $102 recorded in advertising and marketing for the three months ended March 31, 2022 and 2021, respectively, and $130 and $159 for the six months ended March 31, 2022 and 2021, respectively; and $107 and $116 recorded in repairs and maintenance for the three months ended March 31, 2022 and 2021, respectively, and $190 and $204 for the six months ended March 31, 2022 and 2021, respectively; see Note 6)	368		318		698			547
Sublease income	(1)		(1)		(3)			(3)
Total lease expense, net	$	1,736	$	1,189	$	3,529		$	2,309

Other information:
Operating cash outflows from operating leases	$	1,690	$	1,162	$	3,439		$	2,253
Weighted average remaining lease term – operating leases					12 years			12 years
Weighted average discount rate – operating leases					5.6		%	6.1		%

Future maturities of operating lease liabilities as of March 31, 2022 are as follows (in thousands):


	Principal Payments		Interest Payments		Total Payments
April 2022 - March 2023	$	2,306	$	2,080	$	4,386
April 2023 - March 2024	2,503		1,938		4,441
April 2024 - March 2025	2,712		1,789		4,501
April 2025 - March 2026	2,957		1,627		4,584
April 2026 - March 2027	3,118		1,452		4,570
Thereafter	24,227		5,906		30,133
	$	37,823	$	14,792	$	52,615

The above table of maturities of operating lease liabilities does not include future payments of an assigned lease executed in April 2022 related to the October 18, 2021 acquisition, which has a total of approximately $2.6 million of future lease payments until August 2027.