Note 11 - Leases

6 Months Ended

Jul. 31, 2025

Lessee, Operating and Finance Leases [Text Block]

Note 11 - Leases

The Company accounts for its leases under ASC 842, Leases. Under this guidance, arrangements meeting the definition of a lease are classified as operating or financing leases, and are recorded on the consolidated balance sheets, with the exception of leases with an initial term of 12 months or less in accordance with an accounting policy election, for which rent expense is recognized on a straight-line basis over the lease term.

Operating Leases.

Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liabilities short-term, and operating lease liabilities long-term in the Company's consolidated balance sheets.

In January 2025, the Company entered into a lease in Qatar for land upon which the Company intends to build a facility. The agreement provides for annual lease payments of 0.3 million Qatari Riyals (approximately $0.1 million at July 31, 2025), which is inclusive of certain escalation clauses and other variable consideration contained in the agreement. The agreement has an initial lease term of twenty years, which includes the option to terminate the lease agreement after ten years, and the ability to renew the lease at the end of the initial lease term.

In July 2025, the Company entered into an additional lease agreement in Qatar for land and a building. The agreement has an initial lease term of three years with annual lease payments of 1.9 million Qatar Riyals (approximately $0.5 million at July 31, 2025), which includes an escalation clause of approximately 10% for each year thereafter. The agreement may be terminated at any time; however, the Company will be obligated to pay any unpaid balance through the remainder of the lease term.

Finance Leases.

Finance leases are included in property, plant and equipment, current maturities of long-term debt, and long-term debt less current maturities in the Company's consolidated balance sheets.

The Company has several lease agreements, with lease terms of one to fifteen years, which consist of real estate, vehicles and office equipment leases. These leases do not require any contingent rental payments, impose any financial restrictions, or contain any residual value guarantees. Certain of the Company’s leases include renewal options and escalation clauses; renewal options have not been included in the calculation of the lease liabilities and ROU assets as the Company is not reasonably certain to exercise these options. Variable expenses generally represent the Company’s share of the landlord’s operating expenses. The Company does not have any arrangements where it acts as a lessor, other than one sub-lease arrangement, which is not material.

Total lease costs consist of the following:

		Three Months Ended July 31,				Six Months Ended July 31,
Lease costs	*Consolidated Statements of Operations Classification*	*2025*		*2024*		*2025*		*2024*
Finance Lease Costs
Amortization of ROU assets	Cost of sales	$	25	$	37	$	75	$	75
Interest on lease liabilities	Interest expense		1		2		2		3
Operating lease costs	Cost of sales, SG&A expenses		701		438		1,303		893
Short-term lease costs (1)	Cost of sales, SG&A expenses		759		93		1,041		236
*Total Lease costs*		$	1,486	$	570	$	2,421	$	1,207

(1) Includes variable lease costs, which are not material.

Supplemental balance sheet information related to leases is as follows:

Operating and Finance leases	*July 31, 2025*			*January 31, 2025*
Finance leases assets:
Property and Equipment - gross	$	941		$	899
Accumulated depreciation and amortization		(743	)		(626	)
Property and Equipment - net	$	198		$	273

Finance lease liabilities:
Finance lease liability short-term	$	34		$	32
Finance lease liability long-term		27			43
Total finance lease liabilities	$	61		$	75

Operating lease assets:
Operating lease ROU assets	$	11,862		$	8,199

Operating lease liabilities:
Operating lease liability short-term	$	1,383		$	1,071
Operating lease liability long-term		11,425			7,713
Total operating lease liabilities	$	12,808		$	8,784

Weighted-average lease terms and discount rates are as follows:

	July 31, 2025
Weighted-average remaining lease terms (in years):
Finance leases		1.8
Operating leases		14.4

Weighted-average discount rates:
Finance leases		6.4	%
Operating leases		9.4	%

Supplemental cash flow information related to leases is as follows:

	*Six Months Ended July 31,*
	*2025*		*2024*
Cash paid for amounts included in the measurement of lease liabilities:
Financing cash outflows from finance leases	$	17	$	16
Operating cash outflows from finance leases		2		3
Operating cash outflows from operating leases		673		1,045

ROU assets obtained in exchange for new lease obligations:
Operating leases liabilities	$	5,242	$	1,041

Maturities of lease liabilities as of July 31, 2025, are as follows:

		*Operating Leases*			*Finance Leases*
For the six months ending January 31, 2026	$	1,517		$	19
For the year ended January 31, 2027		2,452			37
For the year ended January 31, 2028		2,617			9
For the year ended January 31, 2029		1,945			-
For the year ended January 31, 2030		946			-
For the year ended January 31, 2031		784			-
Thereafter		15,557			-
Total lease payments	$	25,818		$	65

Less: amount representing interest		(13,010	)		(4	)
Total lease liabilities at July 31, 2025	$	12,808		$	61

Rent expense attributable to operating leases was $1.5 million and $0.6 million for the three months ended July 31, 2025 and 2024, respectively.