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Leases

3 Months Ended

Sep. 30, 2025

8. Leases.

The Company is party to leasing contracts in which the Company is the lessee. These lease contracts are classified as either operating or finance leases. The Company’s lease contracts include land, buildings, and equipment. Remaining lease terms range from 1 to 15 years with various term extension options available. The Company includes optional extension periods and early termination options in its lease term if it is reasonably likely that the Company will exercise an option to extend or terminate early.

Operating lease Right of Use (“ROU”) assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term, at the later of the commencement date or business combination date. Because most of the Company’s leases do not provide an implicit rate of return, the discount rate is based on the collateralized borrowing rate of the Company, on a portfolio basis.

The weighted average remaining lease term and weighted average discount rate were as follows at:


	September 30, 2025		June 30, 2025
Weighted average remaining lease term (years)
Finance leases	5.5		5.8
Operating leases	13.1		13.4
Weighted average discount rate applied
Finance leases	8.1	%	8.1	%
Operating leases	8.2	%	8.2	%

The components of lease expense from continuing operations are as follows within our condensed consolidated statements of operations and comprehensive loss:


	Three Months Ended		Three Months Ended
	September 30, 2025		September 30, 2024
Operating lease expense:
Operating lease cost	$	1,068,000	$	1,061,000
Short-term and variable lease cost		83,000		67,000
Finance lease expense:
Finance lease cost - amortization		33,000		8,000
Finance lease cost - interest		10,000		—
Total lease expense	$	1,194,000	$	1,136,000

Supplemental cash flow information related to leases where the Company is the lessee is as follows:


	Three Months Ended		Three Months Ended
	September 30, 2025		September 30, 2024
Operating cash flows from operating leases	$	952,000	$	927,000
Operating cash flows from finance leases		10,000		—
Financing cash flows from finance leases		23,000		8,000
Leased assets obtained in exchange for operating lease liabilities		60,000		—
Leased assets obtained in exchange for finance lease liabilities		267,000		62,000

The maturities of the operating and finance lease liabilities for the fiscal years ended June 30 are as follows:


	Operating Leases		Finance Leases
Remainder of 2026	$	2,903,000	$	117,000
2027		3,934,000		156,000
2028		3,922,000		156,000
2029		3,809,000		130,000
2030		3,870,000		96,000
Thereafter		36,129,000		35,000
Total lease payments		54,567,000		690,000
Less discount to present value		(21,706,000)		(112,000)
Lease liability balance	$	32,861,000	$	578,000