Leases

3 Months Ended

Sep. 30, 2021

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 months ended September 30, 2021 and 2020 are as follows:

	Three Months Ended		Three Months Ended
Lease Cost	September 30, 2021		September 30, 2020
Operating lease cost:
Operating lease cost	$	125	$	118
Short-term rent expense		44		51
Variable lease cost		1		1
Total operating lease cost	$	170	$	170

Finance lease cost:
Amortization right-of-use assets	$	9	$	9
Interest on finance lease liabilities		1		2
Total finance lease cost	$	10	$	11

Supplemental balance sheet information relating to leases was as follows:

		As of		As of
		September 30,		June 30,
		2021		2021
Operating Leases:	Balance Sheet Classifications
Operating Lease ROU Assets	ROU Assets	$	1,165	$	1,251

Finance Leases:
Finance Lease ROU Assets	Property, plant and equipment		203		203
Accumulated amortization	Accumulated depreciation		80		72
Current finance lease liabilities	Current maturities of long-term debt		37		37
Long-term finance lease liabilities	Long-term debt		44		52

Supplemental cash flow and other information related to leases as of and for the three ended September 30, 2021 and 2020 are as follows:

	Three Months Ended
Other information	September 30, 2021			September 30, 2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	126		$	119
Operating cash flows from finance leases		1			2
Financing cash flow from finance leases		9			8
Right-of-use assets obtained in exchange for new operating lease liabilities		35			9
Weighted-average remaining lease term:
Operating leases	2.16 years			3.16 years
Finance leases	3.95 years			3.76 years
Weighted-average discount rate:
Operating leases		1.35	%		3.93	%
Finance leases		6.54	%		6.54	%

Commitments relating to non-cancellable operating and finance leases as of September 30, 2021 for each of the next five years and thereafter are as follows:

Payments due within	Operating Leases			Finance Leases
1 year	$	366		$	42
2 years		266			42
3 years		257			3
4 years		238			0
5 years		75			0
Over 5 years		7			0
Total minimum future payments		1,209			87
Less: Imputed interest		(24	)		(6	)
Total liabilities		1,185			81
Less: Current portion		(355	)		(37	)
Long-term liabilities	$	830		$	44