Leases

3 Months Ended

Apr. 30, 2023

Disclosure Text Block [Abstract]

Lessee, Operating Leases [Text Block]

9.          Leases

We recognized sublease income of $29,000 and $348,000 in the first quarters of fiscal 2024 and 2023, respectively.

The components of lease cost and supplemental cash flow information for leases in the first quarters of fiscal 2024 and 2023 were:

	Thirteen Weeks Ended
	April 30, 2023		May 1, 2022
Operating lease cost	$	2,838	$	2,527
Variable lease cost		82		55
Short-term lease cost		79		80
Total operating lease cost	$	2,999	$	2,662
Operating cash outflows	$	2,694	$	2,829

The right-of-use assets and lease liabilities recorded on our condensed consolidated balance sheets as of April 30, 2023 and January 29, 2023 were as follows:

	April 30, 2023		January 29, 2023
Real estate	$	66,173	$	68,212
Property and equipment		633		737
Total operating leases right-of-use assets	$	66,806	$	68,949
Current portion of operating lease liabilities	$	7,363	$	7,316
Long term operating lease liabilities		61,877		63,762
Total operating lease liabilities	$	69,240	$	71,078

For leases that commenced before July 2022, we used our incremental borrowing rate which was LIBOR plus 1.5%. When we entered into the new loan agreement (described in Note 10 below), our incremental borrowing rate for unsecured term loan became the current BSBY rate plus 1.40%. We use this rate as discount rate for leases commenced in July 2022 and thereafter. The weighted-average discount rate is 4.01%. The weighted-average remaining lease term is 7.8 years.

The following table reconciles the undiscounted future lease payments for operating leases to the operating lease liabilities recorded in the condensed consolidated balance sheets on April 30, 2023:

	Undiscounted Future Operating Lease Payments
Remainder of fiscal 2024	$	7,463
2025		10,102
2026		10,182
2027		10,267
2028		8,931
2029 and thereafter		35,130
Total lease payments	$	82,075
Less: impact of discounting		(12,835	)
Present value of lease payments	$	69,240

As of April 30, 2023, the Company had an additional lease for a showroom in Atlanta, Georgia. This lease commenced in May of calendar 2023 with an initial lease term of 3 years and estimated future minimum rental commitments of approximately $1.0 million. Since the lease had not yet commenced at quarter end, the undiscounted amounts are not included in the table above. Subsequent to the fiscal 2024 first quarter, we entered into an agreement to reduce our footprint in the Georgia warehouse. This amendment results in an approximate $6 million decrease in rental payments over the remaining lease term. Since the agreement had not yet commenced, the modification is not reflected in the table above.