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RIGHT-OF-USE ASSETS AND LEASE LIABILITIES

3 Months Ended

Jul. 31, 2024

NOTE F – RIGHT-OF-USE ASSETS AND LEASE LIABILITIES

The Company’s leases primarily represent offices, warehouses, vehicles, manufacturing facilities and Research and Development (“R&D”) facilities which expire at various times through 2029 and are operating leases. Contractual arrangements are evaluated at inception to determine if the agreement contains a lease.

The Company elected the practical expedient for short-term leases which allows leases with terms of 12 months or less to be recorded on a straight-line basis over the lease term without being recognized on the consolidated balance sheets.

The table below presents ROU assets and liabilities recorded on the respective consolidated balance sheets as follows (in thousands):

	July 31, 2024		April 30, 2024
Assets
Right-of-use assets - operating leases	$	5,646	$	6,036

Liabilities
Operating lease liabilities, current portion		1,468		1,640
Operating lease liabilities, non-current portion		4,301		4,545
Total lease liabilities	$	5,769	$	6,185

Total operating lease expense was $0.5 million for both the three months ended July 31, 2024 and 2023, the majority of which is included in cost of revenues and the remaining amount in selling and administrative expenses on the unaudited condensed consolidated statements of operations.

The table below reconciles the undiscounted cash flows for each of the first four fiscal years and total of the remaining fiscal years to the operating lease liabilities recorded on the unaudited condensed consolidated balance sheet as of July 31, 2024:

Fiscal Year Ending April 30,
(in thousands)

Remainder of 2025	$	1,175
2026		1,363
2027		964
2028		1,262
2029		1,389
Thereafter		587
Total lease payments		6,740
Less imputed interest		(971	)
Present value of future lease payments		5,769
Less current obligations under leases		(1,468	)
Long-term lease obligations		4,301

As of July 31, 2024 and 2023, the weighted-average remaining lease term for all operating leases was 4.81 years and 5.43 years, respectively. The Company does not generally have access to the rate implicit in the leases and therefore selected a rate that is reflective of companies with similar credit ratings for secured debt as the discount rate. The weighted average discount rate for operating leases as of July 31, 2024 and 2023, was 6.34% and 6.23%, respectively.