XML 31 R15.htm IDEA: XBRL DOCUMENT

Long-term debt and lease liabilities

12 Months Ended

Sep. 30, 2025

Long-term debt and lease liabilities

9.Long-term debt and lease liabilities

Senior credit facility

The Company has a $110,000,000 Facility with a group of US banks that matures in September 2027. The Facility consists of a delayed-draw term loan facility of $85,000,000, of which $83,600,000 has been drawn (including $17,400,000 for the acquisition of Hart); a term loan of $5,000,000, which was drawn at closing; and a $20,000,000 revolving credit facility. The Facility is secured by substantially all assets of the Company and is subject to certain financial covenants, with which the Company was in compliance as of September 30, 2025.

A summary of the balances on the Facility as of September 30, 2025 and 2024 is as follows:


		As of			As of
		September 30, 2025			September 30, 2024
Delayed-draw term loan		$	72,383		$	58,400
Term loan			4,250			4,500
Revolving credit facility			10,950			6,323
Total principal			87,583			69,223
Deferred financing costs			(948)			(1,430)
Net carrying value		$	86,635		$	67,793

Current portion		$	4,155		$	3,248
Long-term portion			82,480			64,545
Net carrying value		$	86,635		$	67,793

As of September 30, 2025, scheduled future repayments of the Facility are as follows:



Year Ending September 30,		Amount
2026		$	4,320
2027			83,263
Total		$	87,583

The delayed-draw term loan and the term loan are bearing interest at a weighted average 6.7% as of September 30, 2025. The rate is based on a secured overnight financing rate (“SOFR”), with a floor of 0.5%, plus a spread of 2.1% to 2.85% (2.4% as of September 30, 2025) based on the Company’s leverage ratio and will reprice within three months. The revolving credit facility is bearing interest at 7.0% as of September 30, 2025 and will reprice within three months. The Facility also has fees for unused availability of 0.75% for the delayed-draw term loan and 0.25% for the revolving credit facility. The fair value of the Facility was determined considering market conditions, credit worthiness and the current terms of debt, which is considered Level 2 on the fair value hierarchy. Due to the near-term repricing of the interest rates, the fair value of the Facility approximates the principal value as of September 30, 2025 and 2024.

To manage the risks of the cash flows related to interest expense, the Company entered into several interest rate swaps on $54,000,000 of the principal amount of the Facility. The swaps carry a fixed SOFR of 3.4% to 4.4%, resulting in a weighted combined rate of 6.6%.

The swaps are settled quarterly and mature on September 30, 2026 and at the Facility’s maturity. Any difference between the Facility’s SOFR rate and the swap’s rate is recorded as interest expense. For the year ended September 30, 2025 and

2024, a reduction of $228,000 and $311,000 to interest expense was recorded in the consolidated statements of income (loss), respectively.

As of September 30, 2025, the fair value of the interest rate swap liability, which was determined using Level 2 inputs of market conditions on future expected interest rates, credit worthiness, and the current terms of debt, was $670,000 as compared to $1,122,000 as of September 30, 2024 and is recorded in derivative liability – interest rate swap in the condensed consolidated statements of financial position. The Company has recorded the changes in fair value of derivative liability – interest rate swaps on the consolidated statements of income (loss).

Interest expense on the Facility, including the impact of the interest rate swap agreements, was $5,095,000 and $5,346,000 for the years ended September 30, 2025 and 2024, respectively.

The Company has incurred financing costs to obtain and maintain the Facility, which is reflected as a reduction of the outstanding balance and will be amortized as interest expense using the effective interest method over the life of the Facility. During the years ended September 30, 2025 and 2024, $563,000 and $513,000 of amortization of deferred financing costs was recorded, respectively.

Equipment Loans

The Company is offered financing arrangements from the Company’s suppliers and the supplier’s designated financial institution, in which payments for certain invoices or products can be financed and paid over an extended period. The financial institution pays the supplier when the original invoice becomes due, and the Company pays the third-party financial institution over a period of time. In most cases, the supplier accepts a discounted amount from the financial institution and the Company repays the financial institution the face amount of the invoice with no stated interest, in twelve equal monthly installments. The Company uses its incremental borrowing rate of 6.6% to 8.0% to impute interest on these arrangements, which resulted in interest expense of $800,000 and $985,000 for the years ended September 30, 2025 and 2024, respectively. The discount of the carrying amount from the face value of the loans is $252,000 as of September 30, 2025. The Company has also assumed equipment loans in conjunction with several of its acquisitions.

There are no covenants with the loans and the carrying value of the equipment that is pledged as security against the loans is $22,153,000 and $22,871,000 as of September 30, 2025 and 2024, respectively.

Following is the activity in equipment loans for the years ended September 30, 2025 and 2024:


		Year Ended			Year Ended
		September 30, 2025			September 30, 2024
Beginning Balance		$	12,859			14,347
Additions:
Operations			23,828			25,304
Repayments			(24,472)			(26,792)
Ending Balance			12,215			12,859
Current portion			12,212			12,804
Long-term portion		$	3		$	55

Leases Liabilities

The Company enters into leases for real estate and vehicles. Real estate leases are operating leases and are valued at the net present value of the future lease payments at the incremental borrowing rate. Vehicle leases are finance leases and recorded at the rate implicit in the lease based on the current value and the estimated residual value of the vehicle, if any.

Below is the movement in lease liabilities for the years ended September 30, 2025 and 2024 respectively:



		Operating			Finance			Total
Balance, September 30, 2023		$	16,236		$	2,914		$	19,150
Additions during the period:
Operations			4,229			1,975			6,204
Lease terminations			(438)			—			(438)
Repayments			(4,187)			(1,579)			(5,766)
Balance, September 30, 2024		$	15,840		$	3,310		$	19,150
Additions during the period:
Acquisitions			2,074			456			2,530
Operations			3,953			842			4,795
Lease terminations			(82)			—			(82)
Repayments			(5,015)			(1,436)			(6,451)
Balance, September 30, 2025		$	16,770		$	3,172		$	19,942

Future payments pursuant to lease liabilities are as follows:



Year Ending September 30,		Operating			Finance			Total
2026		$	6,548		$	1,531		$	8,079
2027			5,028			1,054			6,082
2028			3,395			723			4,118
2029			2,345			222			2,567
2030			983			42			1,025
Thereafter			778			—			778
Gross lease payments			19,077			3,572			22,649
Less amounts relating to interest			(2,307)			(400)			(2,707)
Lease liabilities		$	16,770		$	3,172		$	19,942

The components of finance lease expense are as follows:


		Years ended September, 30
	Classification	2025		2024
Finance lease expense:
Amortization of lease assets	Depreciation	$	1,120	$	1,262
Interest on lease liabilities	Interest expense		250		262
Total finance lease cost		$	1,370	$	1,524

Other information relating to leases is as follows:


		As of			As of
		September 30, 2025			September 30, 2024
Weighted average remaining lease term (years)
Operating leases			3.8			4.1
Finance leases			2.7			2.8

Weighted average discount rate
Operating leases			7.2	%		7.4	%
Finance leases			8.7	%		8.5	%