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LEASES

12 Months Ended

Jun. 30, 2022

6. LEASES

The components of operating lease expense for the fiscal years ended June 30, 2021 and 2022 were as follows (in thousands):


	Fiscal Year Ended June 30,
	2021		2022
Operating lease cost	$	9,384	$	10,390
Variable lease cost		927		856
Short-term lease cost		907		1,061
	$	11,218	$	12,307

Sale-leaseback Transaction. In March 2022, we completed a sale-leaseback transaction for our manufacturing facilities and corporate headquarters in Hawthorne, California (the “Hawthorne Property”). We sold the Hawthorne Property for $32 million and recognized a gain on sale of $27.4 million which is included in Other income on the statement of operations. We also entered into a 6-year lease agreement for the Hawthorne Property expiring in March 2028, with two 5-year renewal options. As of June 30, 2022, we recorded the related ROU asset and lease liability for $5.7 million.

Supplemental balance sheet assets and liabilities related to operating leases were as follows (in thousands):


	Balance Sheet Category		June 30, 2021		June 30, 2022
Operating lease ROU assets, net		Other assets	$	23,439	$	39,461

Operating lease liabilities, current portion		Other accrued expenses and current liabilities	$	7,499	$	9,700
Operating lease liabilities, long-term		Other long-term liabilities		16,317		30,363
Total operating lease liabilities			$	23,816	$	40,063

Weighted average remaining lease term						4.9 years
Weighted average discount rate						3.5	%

Supplemental cash flow information related to operating leases for the year ended June 30, 2022 was as follows (in thousands):


	Fiscal Year Ended June 30,
	2021		2022
Cash paid for operating lease liabilities	$	9,884	$	10,046
ROU assets obtained in exchange for new lease obligations		4,212		27,402

Maturities of operating lease liabilities under ASC 842 Leases at June 30, 2022 were as follows (in thousands):


	June 30, 2022
Less than one year	$	10,886
1 – 2 years		9,673
2 – 3 years		7,776
3 – 4 years		6,355
4 – 5 years		5,468
Thereafter		3,517
		43,675
Less: Imputed interest		(3,612)
Total lease liabilities	$	40,063