Company: NGVC
Filing Date: 2025-12-11
Form Type: 10-K
Source: 0001437749-25-037556
Chunk: 404

Company: Natural Grocers by Vitamin Cottage, Inc.
Filing Date: 2025-12-11
Form: 10-K
Item: Item 3
Chunk 404
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 the exercise of sublease renewal options is at the sole discretion of the subtenant. The Company recognizes sublease income on a straight-line basis.

The Company has five operating leases with Chalet Properties, LLC (Chalet), one operating lease with the Isely Family Land Trust LLC (Land Trust) and one operating lease with FTVC, LLC (FTVC), each of which is a related party (see Note 15). The leases began at various times, with the earliest commencing in November 1999, continue for various terms through May 2042 and include various options to renew. The terms and rental rates of these leases have been approved by our audit committee in accordance with our related party transaction policy. As of September 30, 2025, these leases accounted for $10.1 million of operating lease assets and $10.2 million of operating lease liabilities, of which $0.7 million was current, and are included in the disclosures below. Lease expense is recognized on a straight-line basis and was $1.2 million for each of the years ended September 30, 2025, 2024 and 2023.

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The components of total lease cost for the years ended September 30, 2025, 2024 and 2023 were as follows, dollars in thousands:

			Year ended September 30, 

			Lease cost

			Classification

			2025

			2024

			2023

			Operating lease cost:

			Cost of goods sold and occupancy costs

			$
			44,340

			43,958

			43,913

			Store expenses

			461

			461

			319

			Administrative expenses

			393

			402

			327

			Pre-opening expenses

			289

			420

			269

			Finance lease cost:

			Depreciation of lease assets:

			Store expenses

			4,284

			4,128

			3,746

			Pre-opening expenses

			69

			185

			446

			Interest on lease liabilities:

			Interest expense, net

			2,192

			2,052

			1,837

			Pre-opening expenses

			—

			225

			482

			Short-term lease cost

			Store expenses