Leases

3 Months Ended

Jun. 30, 2025

9. Leases

The Company leases various facilities in North America and Asia under operating leases expiring through August 2033. The Company has material nonfunctional currency leases that could have a material impact on the Company’s condensed consolidated statements of operations. As required for other monetary liabilities, lessees remeasure foreign currency-denominated lease liabilities using the exchange rate at each reporting date, but the lease assets are nonmonetary assets measured at historical rates and are not affected by subsequent changes in the exchange rates. In connection with the remeasurement of these leases, the Company recorded a gain of $4,002,000 and a loss of $5,709,000 during the three months ended June 30, 2025 and 2024, respectively. These amounts are included in foreign exchange impact of lease liabilities and forward contracts in the condensed consolidated statements of operations.

During the year ended March 31, 2025, the Company ceased manufacturing operations at its Torrance, California facility as a part of its strategy to enhance its operating efficiencies. This represented a significant change to the use of this right-of-use asset, which required a reassessment of the Company’s asset groups. The Company concluded that this right-of-use asset was no longer part of the Hard Parts asset group. The Company performed a test for recoverability (using Level 3 inputs) which resulted in no impairment at June 30, 2025. Any future changes to the assumptions and estimates from those anticipated may affect the carrying value of right-of-use assets and could result in impairment charges.

Balance sheet information for leases is as follows:


Leases	Classification		June 30,2025	March 31, 2025
Assets:
Operating	Operating lease assets	$	68,281,000	$	66,603,000
Finance	Plant and equipment		5,309,000		4,296,000
Total leased assets		$	73,590,000	$	70,899,000

Liabilities:
Current
Operating	Operating lease liabilities	$	10,196,000	$	9,982,000
Finance	Other current liabilities		1,321,000		1,222,000
Long-term
Operating	Long-term operating lease liabilities		63,056,000		65,308,000
Finance	Other liabilities		3,268,000		1,954,000
Total lease liabilities		$	77,841,000	$	78,466,000

Lease cost recognized in the condensed consolidated statements of operations is as follows:


	Three Months Ended
	June 30,
		2025		2024
Lease cost
Operating lease cost	$	3,490,000	$	3,759,000
Short-term lease cost		216,000		312,000
Variable lease cost		133,000		164,000
Finance lease cost:
Amortization of finance lease assets		355,000		358,000
Interest on finance lease liabilities		74,000		51,000
Total lease cost	$	4,268,000	$	4,644,000

Maturities of lease commitments at June 30, 2025 by fiscal year were as follows:

Maturity of lease liabilities by fiscal year		Operating Leases			Finance Leases			Total
2026- remaining nine months	$	10,643,000		$	1,279,000		$	11,922,000
2027		12,331,000			1,304,000			13,635,000
2028		11,672,000			1,049,000			12,721,000
2029		11,179,000			818,000			11,997,000
2030		11,378,000			740,000			12,118,000
Thereafter		32,135,000			92,000			32,227,000
Total lease payments		89,338,000			5,282,000			94,620,000
Less amount representing interest		(16,086,000	)		(693,000	)		(16,779,000	)
Present value of lease liabilities	$	73,252,000		$	4,589,000		$	77,841,000

Other information about leases is as follows:

	June 30, 2025		March 31, 2025
Lease term and discount rate
Weighted-average remaining lease term (years):
Finance leases	4.0		3.2
Operating leases	7.1		7.3
Weighted-average discount rate:
Finance leases	7.1	%	7.0	%
Operating leases	5.8	%	5.8	%