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Leases

12 Months Ended

Oct. 31, 2024

15. Leases

We lease property and equipment under finance and operating leases. For leases with terms greater than 12 months, we record the related asset and obligation at the present value of lease payments over the term. Many of our leases include rental escalation clauses, renewal options and/or termination options that are factored into our determination of lease payments when appropriate.

We also lease certain property, plant and equipment, including office facilities, under operating leases. The lease term consists of the noncancellable period of the lease and the periods covered by options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. The Company's lease agreements do not contain any residual value guarantees.

Lease Position

The following table presents the lease-related assets and liabilities recorded on the balance sheet as of October 31, 2024 and 2023 (in thousands):


		October 31,		October 31,
		2024		2023

Assets
Non-current assets:
Operating lease assets	Operating lease right-of-use assets	$	18,316	$	18,357
Finance lease assets	Property, plant and equipment, net		4,609		5,051
		$	22,925	$	23,408
Liabilities
Current liabilities:
Operating	Current portion of operating leases	$	3,296	$	3,663
Finance	Current portion of long-term obligations and finance leases		874		831
Long-term obligations
Operating	Long-term operating leases, less current portion		17,476		17,328
Finance	Long-term obligations and finance leases, less current portion		4,274		4,645
		$	25,920	$	26,467


Weighted-average remaining lease term:	Fiscal 2024		Fiscal 2023
Operating leases	6.5 years		6.6 years
Finance leases	7.0 years		7.6 years

Weighted-average discount rate:
Operating leases	2.49	%	2.96	%
Finance leases	4.89	%	4.63	%

Lease Costs

The following table presents certain information related to the lease costs for finance and operating leases for the years ended October 31, 2024 and 2023 (in thousands):


	Year ended		Year ended
	October 31, 2024		October 31, 2023
Amortization of financing lease assets (recorded in cost of sales)	$	994	$	812
Operating lease cost		4,202		4,136
Short-term lease cost		952		672
Variable lease cost		62		61
Interest on financing lease liabilities		255		179
Total lease cost	$	6,465	$	5,860

Other Information

The following table presents supplemental cash flow information related to the leases for the years ended October 31, 2024 and 2023 (in thousands):


	Year ended		Year ended
Cash paid for amounts included in the measurement of lease liabilities	October 31, 2024		October 31, 2023
Operating cash flows for operating leases	$	3,878	$	3,732
Financing cash flows for finance leases		882		702
Operating cash flows for finance leases		255		167

The total right-of-use assets obtained in exchange for new operating leases for the years ended October 31, 2024 and 2023 were $3.7 million and $0.2 million, respectively.

Undiscounted Cash Flows

The following table reconciles the undiscounted cash flows for each of the first five years and total remaining years to the finance lease liabilities and operating lease liabilities recorded on the balance sheet as of October 31, 2024 (in thousands):


	Operating		Finance
Year	Leases		Leases
2025	$	3,741	$	1,101
2026		3,524		922
2027		3,467		827
2028		3,377		758
2029		3,139		584
Thereafter		5,055		1,864
Total lease payments		22,303		6,056
Less: imputed interest		1,531		908
Total lease liability	$	20,772	$	5,148