Note 15 - Leases

6 Months Ended

Dec. 31, 2020

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

NOTE 15 - LEASES

The Company leases certain manufacturing facilities along with a small office space, a company vehicle, several forklifts, several small tooling items, and various items of office equipment. All but one of the Company’s leases are operating leases. Leases have a remaining term of one to seven years some of which have an option to renew. The Company does not assume renewals in determining the lease term unless the renewals are deemed reasonably certain. The lease agreements do not contain any material residual guarantees or material variable lease payments.

The Company has periodically entered into short-term operating leases with an initial term of twelve months or less. The Company elected not to record these leases on the balance sheet. For the three and six months ended December 31, 2020 and 2019, the rent expense for these leases is immaterial.

The Company has certain leases that contain lease and non-lease components and has elected to utilize the practical expedient to account for these components together as a single lease component.

Lease expense is recognized on a straight-line basis over the lease term. The Company used its incremental borrowing rate when determining the present value of lease payments. The adoption of the new lease standard resulted in the recognition of ROU assets of $10.4 million and lease liabilities of $10.8 million which includes the impact of existing deferred rents and tenant improvement allowances on the consolidated balance sheets as of July 1, 2019 for the Company’s real estate leases. The adoption of the new standard resulted in no material impact to the consolidated statements of operations or consolidated statements of cash flow.

	Three months ended				Six months ended
	December 31				December 31
(In thousands)	2020		2019		2020		2019
Operating lease cost	$	565	$	575	$	1,138	$	1,162
Financing lease cost:
Amortization of right of use assets		72		-		145		-
Interest on lease liabilities		23		-		47		-
Variable lease cost		1		-		2		-
Total lease cost	$	661	$	575	$	1,332	$	1,162

Supplemental Cash Flow Information:
	December 31
(In thousands)	2020		2019
Cash flows from operating leases
Fixed payments - operating cash flows	$	1,141	$	1,139
Liability reduction - operating cash flows	$	929	$	885
Cash flows from finance leases
Interest - operating cash flows	$	47	$	-
Repayments of principal portion - financing cash flows	$	118	$	-

Operating Leases:	December 31,			June 30,
	2020			2020
Total operating right-of-use assets	$	7,684		$	8,663
Accrued expenses (Current liabilities)	$	298		$	376
Long-term operating lease liability		8,118			9,021
Total operating lease liabilities	$	8,416		$	9,397
Weighted Average remaining Lease Term (in years)		4.13			4.59
Weighted Average Discount Rate		4.85	%		4.85	%

Finance Leases:	December 31,			June 30,
	2020			2020
Buildings under finance leases	$	2,033		$	2,033
Accumulated depreciation		(194	)		(48	)
Total finance lease assets, net	$	1,839		$	1,985
Accrued expenses (Current liabilities)	$	245		$	239
Long-term finance lease liability		1,631			1,755
Total finance lease liabilities	$	1,876		$	1,994
Weighted Average remaining Lease Term (in years)		6.33			6.83
Weighted Average Discount Rate		4.86	%		4.86	%

Maturities of Lease Liability:	Operating Lease Liabilities			Finance Lease Liabilities
2021	$	1,387		$	210
2022		2,278			329
2023		2,227			329
2024		1,913			335
2025		1,345			362
Thereafter		357			664
Total lease payments		9,507			2,229
Less: Interest		(1,091	)		(353	)
Present Value of Lease Liabilities	$	8,416		$	1,876