Leases

6 Months Ended

Dec. 31, 2019

Note 9. – Leases

The Company has operating leases and a financing lease relating to its pharmacy operations, medical office buildings, certain medical equipment and office equipment. All lease agreements generally require the Company to pay maintenance, repairs, property taxes and insurance costs, which are variable amounts based on actual costs. Variable lease costs also include escalating rent payments that are not fixed at commencement but are based on an index determined in future periods over the lease term based on changes in the Consumer Price Index or other measure of cost inflation. Some leases include one or more options to renew the lease at the end of the initial term, with renewal terms that generally extend the lease at the then market rental rates. Leases may also include an option to buy the underlying asset at or a short time prior to the termination of the lease. All such options are at the Company’s discretion and are evaluated at the commencement of the lease, with only those that are reasonably certain of exercise included in determining the appropriate lease term. The components of lease cost and rent expense for the three and six months ended December 31, 2019 are as follows:

	Three Months Ended		Six Months Ended
Lease Cost	December 31, 2019		December 31, 2019
Operating lease cost:
Operating lease cost	$	143	$	290
Short-term rent expense		4		15
Variable lease cost		0		1
Total operating lease cost	$	147	$	306

Finance lease cost:
Amortization right-of-use assets	$	9	$	18
Interest on finance lease liabilities		2		5
Total finance lease cost	$	11	$	23

Supplemental balance sheet information to leases was as follows:

		As of
	Balance Sheet Classifications	December 31, 2019
Operating Leases:
Operating Lease ROU Assets	ROU Assets	$	1,194

Finance Leases:
Finance Lease ROU Assets	Property, plant and equipment		203
Accumulated amortization	Accumulated depreciation		29
Current finance lease liabilities	Current maturities of long-term debt		33
Long-term finance lease liabilities	Long-term debt		110

Supplemental cash flow and other information related to leases as of and for the three and six months ended December 31, 2019 are as follows:

	Three Months Ended			Six Months Ended
Other information	December 31, 2019			December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	150		$	289
Operating cash flows from finance leases	2			5
Financing cash flow from finance leases	8			16
Right-of-use assets obtained in exchange for new finance lease liabilities	0			0
Right-of-use assets obtained in exchange for new operating lease liabilities		9			1,448
Weighted-average remaining lease term:
Operating leases	3.91 years			3.91 years
Finance leases	3.77 years			3.77 years
Weighted-average discount rate:
Operating leases		6.54	%		6.54	%
Finance leases		5.53	%		5.53	%

Commitments relating to non-cancellable operating and finance leases as of December 31, 2019 for each of the next five years and thereafter are as follows:

Payments due within	Operating Leases			Finance Leases
1 year	$	506		$	42
2 years		352			42
3 years		146			42
4 years		103			37
5+ years		222			0
Total minimum future payments		1,329			163
Less: Imputed interest		(133	)		(20	)
Total liabilities		1,196			143
Less: Current portion		(455	)		(33	)
Long-term liabilities	$	741		$	110