Leases

3 Months Ended

Jun. 30, 2024

Leases [Abstract]

Leases

Leases

The Company’s lease arrangements generally include real estate (manufacturing facilities, sales offices, distribution centers, warehouses), vehicles, and equipment. Leases with a term greater than one year are recognized on the Consolidated Balance Sheet; the Company has elected not to recognize leases with terms of one year or less on the Consolidated Balance Sheet. Lease obligations and their corresponding ROU assets are recorded based on the present value of lease payments over the expected lease term. The Company recognizes lease expense on a straight-line basis over the lease term.

The Company's leases have lease terms ranging from 1 to 23 years, some of which include options to extend or terminate the lease. The exercise of lease renewal options is at the Company’s sole discretion. When deemed reasonably certain of exercise,

the renewal options are included in the determination of the lease term. The Company’s lease agreements do not contain material residual value guarantees or any material restrictive covenants.

The following table illustrates the lease-related assets and liabilities recorded on the Condensed Consolidated Balance Sheet (in thousands):

	June 30, 2024		March 31, 2024
Operating leases:
Other assets	$	68,765	$	65,584
Accrued liabilities	8,675		8,723
Other non current liabilities	64,600		60,666
Total operating liabilities	$	73,275	$	69,389
Finance lease:
Net property, plant, and equipment	$	11,345	$	11,596
Current portion of long-term debt and finance lease obligation	687		670
Term loan, AR securitization facility and finance lease obligations	12,092		12,267
Total finance liabilities	$	12,779	$	12,937

Operating lease expense of $3,704,000 and $3,062,000 for the three months ended June 30, 2024 and June 30, 2023, respectively, is included in Income from operations on the Condensed Consolidated Statements of Operations. Short-term lease expense, sublease income, and variable lease expenses were not material for the three months ended June 30, 2024 and June 30, 2023, respectively. Finance lease expense of $250,000 for the three months ended June 30, 2024 and June 30, 2023, respectively, is included in Income from operations on the Condensed Consolidated Statements of Operations. Interest and debt expense related to the finance lease of $144,000 and $151,000 is included the Company's Condensed Consolidated Statements of Operations for the three months ended June 30, 2024 and June 30, 2023, respectively.

Supplemental cash flow information related to leases is as follows (in thousands):

	Three Months Ended   June 30,
	2024		2023
Cash paid for amounts included in the measurement of operating lease liabilities	$	3,023	$	2,435
Cash paid for amounts included in the measurement of finance lease liabilities	$	302	$	294
ROU assets obtained in exchange for new operating lease liabilities	$	5,929	$	5,097