| Operating and Finance Leases [Text Block] |
Note 9. Leases
Lease expense consisted of the following:
| |
|
Classification on the Consolidated Statement of Operations |
|
Year Ended October 31, |
|
|
Year Ended October 31, |
|
| (in thousands) |
|
|
|
2024 |
|
|
2023 |
|
| Operating lease expense |
|
General and administrative expenses |
|
$ |
7,324 |
|
|
$ |
6,522 |
|
| Short-term and variable lease expense |
|
General and administrative expenses |
|
|
599 |
|
|
|
686 |
|
| Finance lease expense: |
|
|
|
|
|
|
|
|
|
|
| Amortization of right-of-use assets |
|
General and administrative expenses |
|
|
2 |
|
|
|
22 |
|
| Interest on lease liability |
|
Interest expense, net |
|
|
- |
|
|
|
9 |
|
| Total finance lease expense |
|
$ |
2 |
|
|
|
30 |
|
| Sublease income |
|
General and administrative expenses |
|
|
(141 |
) |
|
|
(85 |
) |
| Total lease expense |
|
$ |
7,784 |
|
|
$ |
7,153 |
|
Supplemental consolidated balance sheet information and other information related to leases:
| (in thousands) |
|
|
October 31, |
|
|
October 31, |
|
| Leases |
Classification on the Consolidated Balance Sheet |
|
2024 |
|
|
2023 |
|
| Assets: |
|
|
|
|
|
|
|
|
|
| Operating lease assets |
Right-of-use operating lease assets |
|
$ |
26,179 |
|
|
$ |
24,815 |
|
| Finance lease assets |
Property, plant and equipment, net |
|
|
- |
|
|
|
680 |
|
| Total leased assets |
|
|
26,179 |
|
|
|
25,495 |
|
| Current liabilities: |
|
|
|
|
|
|
|
|
|
| Operating |
Operating lease obligations, current portion |
|
$ |
4,817 |
|
|
$ |
4,739 |
|
| Finance |
Finance lease obligations, current portion |
|
|
- |
|
|
|
125 |
|
| Noncurrent liabilities: |
|
|
|
|
|
|
|
|
|
| Operating |
Operating lease obligations, non-current |
|
|
21,716 |
|
|
|
20,458 |
|
| Finance |
Finance lease obligations, non-current |
|
|
- |
|
|
|
50 |
|
| Total leased liabilities |
|
$ |
26,533 |
|
|
$ |
25,372 |
|
| |
|
|
|
|
|
|
|
|
|
| Weighted-average remaining lease term (years) |
|
|
|
|
|
|
|
|
|
| Operating leases |
|
|
7 |
|
|
|
6 |
|
| Finance leases |
|
|
- |
|
|
|
2 |
|
| Weighted-average discount rate |
|
|
|
|
|
|
|
|
|
| Operating leases |
|
|
7.8 |
% |
|
|
7.1 |
% |
| Finance leases |
|
|
- |
|
|
|
3.8 |
% |
Supplemental consolidated cash flow statement information related to leases:
| (in thousands) |
|
2024 |
|
|
2023 |
|
| Cash paid for amounts included in the measurement of lease liabilities: |
|
|
|
|
|
|
|
|
| Operating cash flows from operating leases |
|
$ |
5,076 |
|
|
$ |
5,278 |
|
| Financing cash flows from finance leases |
|
|
5 |
|
|
|
109 |
|
The table below reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the operating lease and finance lease liabilities recorded on the Company’s consolidated balance sheet as of October 31, 2024:
| |
|
Future Payments |
|
| (in thousands) |
|
Operating Leases |
|
| 2025 |
|
$ |
6,500 |
|
| 2026 |
|
|
5,585 |
|
| 2027 |
|
|
5,002 |
|
| 2028 |
|
|
4,430 |
|
| 2029 |
|
|
3,517 |
|
| Thereafter |
|
|
9,604 |
|
| Total lease payments |
|
$ |
34,638 |
|
| Less: Interest |
|
|
(8,105 |
) |
| Total lease payments |
|
$ |
26,533 |
|
| Less: Current portion |
|
|
(4,817 |
) |
| Long-term portion |
|
$ |
21,716 |
|
As of October 31, 2024, we had no material operating or finance leases that had not yet commenced.
Related Party Leases
The Company has two related party leases. Eco-Pan leases its facility in Pacific, Washington from an investor group in which Bruce Young, the Company’s Chief Executive Officer, holds an approximately 25% interest. Camfaud leases its facility in Essex, England from a trust the trustees of which include Tony Faud, the Company’s Managing Director — U.K., and members of his family.
The following is supplemental consolidated balance sheet information and other information related to related party leases:
| (in thousands) |
|
|
October 31, |
|
|
October 31, |
|
| Leases |
Classification on the Consolidated Balance Sheet |
|
2024 |
|
|
2023 |
|
| Assets: |
|
|
|
|
|
|
|
|
|
| Operating lease assets |
Right-of-use operating lease assets |
|
$ |
2,820 |
|
|
$ |
2,972 |
|
| Current liabilities: |
|
|
|
|
|
|
|
|
|
| Operating |
Operating lease obligations, current portion |
|
$ |
323 |
|
|
$ |
284 |
|
| Noncurrent liabilities: |
|
|
|
|
|
|
|
|
|
| Operating |
Operating lease obligations, non-current |
|
|
2,480 |
|
|
|
2,669 |
|
| Total leased liabilities |
|
$ |
2,803 |
|
|
$ |
2,953 |
|
For both years ended October 31, 2024 and 2023, $0.6 million was included in general and administrative expenses on the consolidated statement of operations related to related party leases.
|