Leases

9 Months Ended

Mar. 31, 2020

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 nine months ended March 31, 2020 are as follows:

	Three Months Ended		Nine Months Ended
Lease Cost	March 31, 2020		March 31, 2020
Operating lease cost:
Operating lease cost	$	147	$	437
Short-term rent expense		9		24
Variable lease cost		1		2
Total operating lease cost	$	157	$	463

Finance lease cost:
Amortization right-of-use assets	$	9	$	27
Interest on finance lease liabilities		2		7
Total finance lease cost	$	11	$	34

Supplemental balance sheet information relating to leases was as follows:

		As of
	Balance Sheet Classifications	March 31, 2020
Operating Leases:
Operating Lease ROU Assets	ROU Assets	$	1,076

Finance Leases:
Finance Lease ROU Assets	Property, plant and equipment		203
Accumulated amortization	Accumulated depreciation		36
Current finance lease liabilities	Current maturities of long-term debt		34
Long-term finance lease liabilities	Long-term debt		98

Supplemental cash flow and other information related to leases as of and for the three and nine months ended March 31, 2020 are as follows:

	Three Months Ended			Nine Months Ended
Other information	March 31, 2020			March 31, 2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	148		$	437
Operating cash flows from finance leases	2			7
Financing cash flow from finance leases	8			24
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		15			1,463
Weighted-average remaining lease term:
Operating leases	3.66 years			3.66 years
Finance leases	3.74 years			3.74 years
Weighted-average discount rate:
Operating leases		6.54	%		6.54	%
Finance leases		5.56	%		5.56	%

Commitments relating to non-cancellable operating and finance leases as of March 31, 2020 for each of the next five years and thereafter are as follows:

Payments due within	Operating Leases			Finance Leases
1 year	$	453		$	42
2 years		320			42
3 years		121			42
4 years		105			25
5 years		98			0
Over 5 years		98			0
Total minimum future payments		1,195			151
Less: Imputed interest		(118	)		(19	)
Total liabilities		1,077			132
Less: Current portion		(406	)		(34	)
Long-term liabilities	$	671		$	98