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LEASE
3 Months Ended
Jun. 30, 2026
Lease  
LEASE

NOTE 10. LEASE

 

The Company leases office space in Hong Kong under a non-cancelable operating lease agreement executed on June 26, 2023, with a term ending August 15, 2025. This lease has been extended to end on August 17, 2027.

 

In April 2024, the Company entered two additional non-cancelable operating lease agreements for office spaces located in Rolling Hills Estates, California. The first lease commenced on April 10, 2024, and expired on November 30, 2025. The Company has renewed the lease agreement with leasing period from December 1, 2025 to December 31, 2026. The second lease began on April 22, 2024, and was terminated on April 30, 2025. This has been extended to October 30, 2026. In November 2024, the Company entered another lease for office space in Rolling Hills Estates, which commenced on November 11, 2024, and will expire on December 31, 2025 and this lease has been extended to December 31, 2026.

 

On December 26, 2025, the Company entered an operating lease agreement for its office in Guangzhou, PRC. The lease will be expired on December 25, 2026.

 

On May 1, 2026, the Company, through its subsidiary OFA Japan Inc., entered into a non-cancelable operating lease agreement for office space and one adjacent parking space located in Choshi City, Chiba Prefecture, Japan. The lease has an initial term of two years, commencing on May 1, 2026 and expiring on April 30, 2028. Unless either party provides written notice of termination at least six months prior to the expiration date, the lease will automatically renew for an additional two-year term under the same terms and conditions.

 

The balances for the operating leases where the Company is the lessee are presented within the balance sheets as follows:

 

  

As of

June 30, 2026

  

As of

March 31, 2026

 
Operating leases:          
Operating lease right-of-use assets  $639,255   $635,622 
           
Operating lease liabilities, current  $173,255   $164,391 
Operating lease liabilities, noncurrent   467,562    454,404 
Total operating lease liabilities  $640,817   $618,795 
           
Weighted average remaining lease term (in years)   4.32    4.52 

 

The components of lease expenses for the three months ended June 30, 2026 and 2025 were as follows:

 

   2026   2025 
   For the three months ended June 30, 
   2026   2025 
Operating lease cost  $57,674   $14,801 
Cost of other leases with period less than one year and variable lease costs   13,547    1,820 
           
Total lease expenses  $71,221   $16,621 
           
Weighted average discount rate (%)   3.63%   3.63%

 

 

OFA GROUP

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

THREE MONTHS ENDED JUNE 30, 2026 AND 2025

 

Supplemental cash flow information related to leases for the three months ended June 30, 2026 and 2025 were as follows:

 

Cash paid for amounts included in the measurement of lease liabilities:  2026   2025 
   For the three months ended June 30, 
Cash paid for amounts included in the measurement of lease liabilities:  2026   2025 
Operating cash flows from operating leases  $71,221   $16,621 
Supplemental noncash information:          
Right-of-use assets obtained in exchange for lease obligation:  $25,026   $- 

 

As of June 30, 2026, the maturities of operating lease liabilities (excluding short-term lease) are as follows:

 

As of June 30,  Operating Lease 
2027  $113,702 
2028   150,384 
2029   127,954 
2030   127,332 
2031   131,152 
Thereafter   44,038 
Total lease payments   694,562 
Less: Imputed interest   (53,745)
Present value of lease liabilities  $640,817 
Less: current portion   (173,255)
Lease obligations, noncurrent   467,562 

 

As of March 31, 2026, the maturities of operating lease liabilities (excluding short-term lease) are as follows:

 

As of March 31,  Operating Lease 
2027  $183,904 
2028   126,973 
2029   117,382 
2030   117,382 
2031   127,163 
Total lease payments   672,804 
Less: Imputed interest   (54,009)
Present value of lease liabilities  $618,795 
Less: current portion   (164,391)
Lease obligations, noncurrent   454,404