Note 16 - Income Taxes

12 Months Ended

Sep. 30, 2024

Notes to Financial Statements

Income Tax Disclosure [Text Block]

16. Income Taxes

The following are the components of the provision for income taxes for the years ended September 30, 2024, 2023 and 2022, respectively, dollars in thousands:

	Year ended September 30,
	2024			2023			2022
Current federal income tax expense	$	10,413			5,291			4,667
Current state income tax expense		2,408			1,311			1,143
Total current income tax expense		12,821			6,602			5,810
Deferred federal income tax (benefit) expense		(3,283	)		(1,334	)		559
Deferred state income tax (benefit) expense		(672	)		(141	)		50
Total deferred income tax (benefit) expense		(3,955	)		(1,475	)		609
Total provision for income taxes	$	8,866			5,127			6,419

The differences between the United States federal statutory income tax rate and the Company’s effective tax rate are as follows:

	Year ended September 30,
	2024			2023			2022
Statutory tax rate		21.0	%		21.0			21.0
State income taxes, net of federal income tax expense		2.9			3.1			3.4
Enhanced food deduction		(1.9	)		(3.1	)		(0.5	)
Deferred tax liability adjustment		0.8			—			1.0
Other, net		(2.1	)		(2.9	)		(1.8	)
Effective tax rate	20.7		%		18.1			23.1

Deferred taxes have been classified on the consolidated balance sheets as follows, dollars in thousands:

	As of September 30,
	2024			2023
Long-term assets	$	—			—
Long-term liabilities		(10,471	)		(14,427	)
Net deferred tax liabilities	$	(10,471	)		(14,427	)

The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities are as follows, dollars in thousands:

	As of September 30,
	2024			2023
Deferred tax assets:
Trademarks	$	562			576
Finance lease liabilities		11,511			12,403
Operating lease liabilities		73,037			76,045
Research and experimental expenditures		955			963
Accrued paid time off		768			708
Other		944			764
Gross deferred tax assets		87,777			91,459
Deferred tax liabilities:
Property and equipment		(17,796	)		(21,539	)
Finance lease assets		(9,944	)		(11,003	)
Operating lease assets		(67,426	)		(70,517	)
Leasehold improvements		(1,919	)		(2,095	)
Other		(1,163	)		(732	)
Gross deferred tax liabilities		(98,248	)		(105,886	)
Net deferred tax liabilities	$	(10,471	)		(14,427	)

The Company believes that it is more likely than not that it will fully realize all deferred tax assets in the form of future deductions based on the nature of the deductible temporary differences and expected future taxable income.

The Company did not utilize any federal income tax loss carryforwards or federal tax credit carryforwards for the years ended September 30, 2024, 2023 and 2022. The Company utilized less than $0.1 million, $0.1 million and $0.1 million in tax effected state income tax carryforwards for the years ended September 30, 2024, 2023 and 2022, respectively.

The Company did not have any uncertain tax positions as of September 30, 2024 and 2023.

The Company files income tax returns with federal, state and local tax authorities. With limited exceptions, the Company is no longer subject to federal income tax examinations for fiscal years 2020 and prior and is no longer subject to state and local income tax examinations for fiscal years 2019 and prior.