Note 8 - Leases

9 Months Ended

Dec. 31, 2022

Notes to Financial Statements

Lessee, Operating and Finance Leases [Text Block]

8. Leases

The Company determines whether an arrangement is a lease at inception of the agreement. Presently, the Company leases land, machinery and equipment under various operating and financing leases.

Right-of-Use, or ROU, assets represent the Company’s right to use the underlying assets for the lease term, and lease obligations represent the net present value of the Company’s obligation to make payments arising from these leases. ROU assets and lease obligations are recognized at commencement date based on the present value of lease payments over the lease term using the implicit lease interest rate or, when unknown, an incremental borrowing rate based on the information available at commencement date or April 1, 2019 for leases that commenced prior to that date.

Lease terms may include options to extend or terminate the lease, and the impact of these options are included in the calculation of the ROU asset and lease obligation only when the exercise of the option is at the Company’s sole discretion and it is reasonably certain that the Company will exercise that option. The Company will not separate lease and non-lease components for its leases when it is impractical to separate the two. In addition, the Company may have certain leases that have variable payments based solely on output or usage of the leased asset. These variable operating lease assets are excluded from the Company’s balance sheet presentation and expensed as incurred. Leases with an initial term of 12 months or less, or short-term leases, are not recorded on the accompanying condensed consolidated balance sheets.

ROU assets and lease obligations for the Company’s operating and financing leases are disclosed separately in the Company’s condensed consolidated balance sheets. The components of lease cost were as follows (in thousands):

	Three Months Ended				Nine Months Ended
	December 31,		January 1,		December 31,		January 1,
	2022		2022		2022		2022
Lease cost:
Amortization of right of use asset	$	1,703	$	1,557	$	4,960	$	4,398
Interest on lease liabilities		239		263		720		799
Finance lease cost		1,942		1,820		5,680		5,197
Operating lease cost		2,926		4,739		10,810		14,699
Total lease cost	$	4,868	$	6,559	$	16,490	$	19,896
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from finance leases					$	720	$	799
Operating cash flows from operating leases						12,343		15,917
Financing cash flows from finance leases						6,515		5,803
					$	19,578	$	22,519
Right-of-use assets obtained in exchange for new finance lease liabilities					$	4,053	$	9,754
Right-of-use assets obtained in exchange for new operating lease liabilities					$	4,184	$	10,505
Weighted-average lease term (years):
Financing leases						4.6		4.6
Operating leases						4.6		4.2
Weighted-average discount rate (percentage):
Financing leases						3.6		3.4
Operating leases						4.4		4.2

Undiscounted future lease payments under non-cancelable operating and financing leases, along with a reconciliation of undiscounted cash flows to operating and financing lease obligations, respectively, as of December 31, 2022 were as follows (in thousands):

Years ending March 31:	Operating		Financing
Balance of 2023	$	1,432	$	2,467
2024		9,217		8,393
2025		6,025		5,061
2026		3,533		3,975
2027		3,021		2,917
2028-2033		5,521		5,278
Total minimum payment required	$	28,749	$	28,091
Less interest		2,631		2,264
Present value of minimum lease payments		26,118		25,827
Amount due within one year		8,899		8,445
Long-term lease obligations	$	17,219	$	17,382