v3.25.1
Leases
 6 Months Ended
Apr. 30, 2025
Leases [Abstract]  
Leases Leases
We recognize a right-of-use (ROU) asset and lease liability for each operating and finance lease with a contractual term greater than 12 months at the time of lease inception. We include ROU assets and lease liabilities for leases that exist within other contracts. Leases with an original term of 12 months or less are not recognized on the balance sheet, and the rent expense related to those short-term leases is recognized over the lease term. We do not account for lease and non-lease (e.g., common area maintenance) components of contracts separately for any underlying asset class.
We lease certain manufacturing plants, warehouses, office space, vehicles and equipment under finance and operating leases. Lease commencement occurs on the date we take possession or control of the property or equipment. Original terms for our real estate-related leases are generally between five years and twenty years. Original terms for equipment-related leases, primarily manufacturing equipment and vehicles, are generally between one year and ten years. Some of our leases also include rental escalation clauses. Renewal options are included in the determination of lease payments when management determines the options are reasonably certain of exercise, considering financial performance, strategic importance and/or invested capital.
If readily determinable, the rate implicit in the lease is used to discount lease payments to present value; however, substantially all of our leases do not provide a readily determinable implicit rate. When the implicit rate is not determinable, our estimated incremental borrowing rate is utilized, determined on a collateralized basis, to discount lease payments based on information available at lease commencement.
Total lease costs recorded include fixed operating lease costs and variable lease costs. Most of our real estate leases require we pay certain expenses, such as common area maintenance costs, of which the fixed portion is included in operating lease costs. We recognize operating lease costs on a straight-line basis over the lease term. In addition to the above costs, variable lease costs are recognized when probable and are not included in determining the present value of our lease liability.
The ROU asset is measured at the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date and initial direct costs. For operating leases, ROU assets are reduced over the lease term by the recognized straight-line lease expense less the amount of accretion of the lease liability determined using the effective interest method. For finance leases, ROU assets are amortized on a straight-line basis over the shorter of the useful life of the leased asset or the lease term. Interest expense on each finance lease liability is recognized utilizing the effective interest method. ROU assets are tested for impairment in the same manner as long-lived assets. Additionally, we monitor for events or changes in circumstances that may require a reassessment of one of our leases and determine if a remeasurement is required.
The table below presents the lease-related assets and liabilities recorded on the balance sheet at April 30, 2025 and October 31, 2024 (in thousands):
LeasesClassificationApril 30,
2025		October 31,
2024
Assets
Operating lease assetsOperating lease right-of-use assets$149,322 $126,715 
Finance lease assets
Property, plant and equipment (less accumulated depreciation of $13,479 and $10,362)
70,997 67,046 
Total lease assets$220,319 $193,761 
Liabilities
Current
OperatingCurrent operating lease liabilities$14,184 $12,475 
FinanceCurrent maturities of long-term debt4,068 3,688 
Noncurrent
OperatingNoncurrent operating lease liabilities139,955 117,560 
FinanceLong-term debt57,116 56,988 
Total lease liabilities$215,323 $190,711 
The table below presents the components of lease costs for the three and six months ended April 30, 2025 and 2024 (in thousands):
Three Months EndedSix Months Ended
April 30,April 30,
2025202420252024
Operating lease cost
$5,774 $2,520 $11,108 $4,953 
Finance lease cost
Amortization of leased assets1,203 907 2,397 1,781 
Interest on lease liabilities723 618 1,441 1,231 
Variable lease costs
1,010 487 1,461 938 
Total lease cost$8,710 $4,532 $16,407 $8,903 
The table below presents supplemental cash flow information related to leases for the six months ended April 30, 2025 and 2024 (in thousands):
Six Months Ended
April 30,
20252024
Cash paid for amounts included in the measurement of lease liabilities:
Finance leases - financing cash flows$1,900 $1,382 
Finance leases - operating cash flows$1,441 $1,231 
Operating leases - operating cash flows$9,605 $4,550 
Right-of-use assets obtained in exchange for lease liabilities:
Operating leases$27,803 $21,834 
Finance leases$1,143 $1,228 
The table below presents the weighted-average remaining lease terms and weighted-average discount rates for the Company's leases as of April 30, 2025 and October 31, 2024:
April 30,
2025		October 31,
2024
Weighted-average remaining lease term (in years)
Operating leases11.711.5
Financing leases15.816.3
Weighted-average discount rate
Operating leases5.54 %5.32 %
Financing leases4.87 %4.84 %
The table below presents the maturity of the lease liabilities as of April 30, 2025 (in thousands):
Operating LeasesFinance Leases
2025 (remaining six months)$11,054 $3,458 
202621,497 6,857 
202718,867 6,707 
202817,266 6,477 
202916,575 6,157 
Thereafter127,728 57,609 
Total lease payments212,987 87,265 
Less: present value discount58,848 26,081 
Total lease liabilities$154,139 $61,184 
Leases Leases
We recognize a right-of-use (ROU) asset and lease liability for each operating and finance lease with a contractual term greater than 12 months at the time of lease inception. We include ROU assets and lease liabilities for leases that exist within other contracts. Leases with an original term of 12 months or less are not recognized on the balance sheet, and the rent expense related to those short-term leases is recognized over the lease term. We do not account for lease and non-lease (e.g., common area maintenance) components of contracts separately for any underlying asset class.
We lease certain manufacturing plants, warehouses, office space, vehicles and equipment under finance and operating leases. Lease commencement occurs on the date we take possession or control of the property or equipment. Original terms for our real estate-related leases are generally between five years and twenty years. Original terms for equipment-related leases, primarily manufacturing equipment and vehicles, are generally between one year and ten years. Some of our leases also include rental escalation clauses. Renewal options are included in the determination of lease payments when management determines the options are reasonably certain of exercise, considering financial performance, strategic importance and/or invested capital.
If readily determinable, the rate implicit in the lease is used to discount lease payments to present value; however, substantially all of our leases do not provide a readily determinable implicit rate. When the implicit rate is not determinable, our estimated incremental borrowing rate is utilized, determined on a collateralized basis, to discount lease payments based on information available at lease commencement.
Total lease costs recorded include fixed operating lease costs and variable lease costs. Most of our real estate leases require we pay certain expenses, such as common area maintenance costs, of which the fixed portion is included in operating lease costs. We recognize operating lease costs on a straight-line basis over the lease term. In addition to the above costs, variable lease costs are recognized when probable and are not included in determining the present value of our lease liability.
The ROU asset is measured at the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date and initial direct costs. For operating leases, ROU assets are reduced over the lease term by the recognized straight-line lease expense less the amount of accretion of the lease liability determined using the effective interest method. For finance leases, ROU assets are amortized on a straight-line basis over the shorter of the useful life of the leased asset or the lease term. Interest expense on each finance lease liability is recognized utilizing the effective interest method. ROU assets are tested for impairment in the same manner as long-lived assets. Additionally, we monitor for events or changes in circumstances that may require a reassessment of one of our leases and determine if a remeasurement is required.
The table below presents the lease-related assets and liabilities recorded on the balance sheet at April 30, 2025 and October 31, 2024 (in thousands):
LeasesClassificationApril 30,
2025		October 31,
2024
Assets
Operating lease assetsOperating lease right-of-use assets$149,322 $126,715 
Finance lease assets
Property, plant and equipment (less accumulated depreciation of $13,479 and $10,362)
70,997 67,046 
Total lease assets$220,319 $193,761 
Liabilities
Current
OperatingCurrent operating lease liabilities$14,184 $12,475 
FinanceCurrent maturities of long-term debt4,068 3,688 
Noncurrent
OperatingNoncurrent operating lease liabilities139,955 117,560 
FinanceLong-term debt57,116 56,988 
Total lease liabilities$215,323 $190,711 
The table below presents the components of lease costs for the three and six months ended April 30, 2025 and 2024 (in thousands):
Three Months EndedSix Months Ended
April 30,April 30,
2025202420252024
Operating lease cost
$5,774 $2,520 $11,108 $4,953 
Finance lease cost
Amortization of leased assets1,203 907 2,397 1,781 
Interest on lease liabilities723 618 1,441 1,231 
Variable lease costs
1,010 487 1,461 938 
Total lease cost$8,710 $4,532 $16,407 $8,903 
The table below presents supplemental cash flow information related to leases for the six months ended April 30, 2025 and 2024 (in thousands):
Six Months Ended
April 30,
20252024
Cash paid for amounts included in the measurement of lease liabilities:
Finance leases - financing cash flows$1,900 $1,382 
Finance leases - operating cash flows$1,441 $1,231 
Operating leases - operating cash flows$9,605 $4,550 
Right-of-use assets obtained in exchange for lease liabilities:
Operating leases$27,803 $21,834 
Finance leases$1,143 $1,228 
The table below presents the weighted-average remaining lease terms and weighted-average discount rates for the Company's leases as of April 30, 2025 and October 31, 2024:
April 30,
2025		October 31,
2024
Weighted-average remaining lease term (in years)
Operating leases11.711.5
Financing leases15.816.3
Weighted-average discount rate
Operating leases5.54 %5.32 %
Financing leases4.87 %4.84 %
The table below presents the maturity of the lease liabilities as of April 30, 2025 (in thousands):
Operating LeasesFinance Leases
2025 (remaining six months)$11,054 $3,458 
202621,497 6,857 
202718,867 6,707 
202817,266 6,477 
202916,575 6,157 
Thereafter127,728 57,609 
Total lease payments212,987 87,265 
Less: present value discount58,848 26,081 
Total lease liabilities$154,139 $61,184