LEASES

9 Months Ended

Oct. 31, 2019

Disclosure Text Block [Abstract]

Leases of Lessee Disclosure [Text Block]

Note 4.  Leases

The Company used the optional transition method in adopting ASC 842, which resulted in applying ASC 842 at the date of adoption (February 1, 2019). Thus, comparative information has not been restated and continues to be reported under accounting standards in effect for those periods.

ASC 842 provides for three practical expedients, which the Company elected as a package. Pursuant to this package, the Company did not reassess: i) whether any expired or existing contracts are or contain leases; ii) the lease classification for any expired or existing leases that were previously classified as operating leases; or iii) the initial direct costs for any existing leases.

The Company elected the practical expedient, available pursuant to ASC 842, for lessees to include both lease and non-lease components as a single component and account for it as a lease. In general, certain maintenance costs are the responsibility of the Company under its railcar leases. These maintenance costs are a non-lease component which the Company elected to combine with rental payments and account for the total amount as operating lease expense.

At October 31, 2019, the Company has lease agreements, as lessee, for railcars. All of the leases are accounted for as operating leases. The lease agreements do not contain a specified implicit interest rate; therefore, the Company’s estimated incremental borrowing rate was used to determine the present value of future minimum lease payments. The exercise of any lease renewal is at the Company’s sole discretion. The lease term for all of the Company’s leases includes the noncancelable period of the lease and any periods covered by renewal options that the Company is reasonably certain to exercise. Certain leases include rent escalations pre-set in the agreements, which are factored into the lease payment stream. The components of lease expense, classified as SG&A expenses on the Consolidated Condensed Statement of Operations are as follows:

	Three Months Ended October 31, 2019		Nine Months Ended October 31, 2019
Operating lease expense	$	1,557	$	4,867
Variable lease expense		139		491
Total lease expense	$	1,696	$	5,358

The following table is a summary of future minimum rentals on such leases at October 31, 2019 (amounts in thousands):

Years Ended January 31,	Minimum Rentals
Remainder of 2020	$	1,620
2021		5,668
2022		4,958
2023		3,251
2024		2,085
Thereafter		1,257
Total		18,839
Less: present value discount		1,822
Operating lease liabilities	$	17,017

At October 31, 2019, the weighted average remaining lease term is 3.7 years and the weighted average discount rate is 5.46% for the above leases.

At January 31, 2019, the Company had operating lease agreements (pursuant to ASC 840, “Leases”), as lessee, for railcars and other equipment. At January 31, 2019, future minimum annual rentals on such leases were as follows (amounts in thousands):

Years Ended January 31,	Minimum Rentals
2020	$	6,767
2021		5,487
2022		4,791
2023		3,208
2024		2,041
Thereafter		1,221
Total	$	23,515