Company: AIRTP
Filing Date: 2025-06-27
Form Type: 10-K
Source: 0000353184-25-000044
Chunk: 249

Company: AIR T INC
Filing Date: 2025-06-27
Form: 10-K
Item: Item 8
Chunk 249
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 the asset or liability.Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).Assets Measured and Recorded at Fair Value on a Recurring BasisThe following consolidated balance sheet items are measured at fair value on a recurring basis (in thousands):Fair Value Measurements at March 31,20252024Marketable securities (including restricted investments) (Level 1)$1,105 $1,923 Interest rate swaps (liability) asset (Level 2)(44)1,909 Contrail's earnout (Level 3)$1,539 $— Contrail's redeemable non-controlling interest (Level 3)$— $7,437 The fair values of our interest rate swaps are based on the market standard methodology of netting the discounted expected future variable cash receipts and the discounted future fixed cash payments. The variable cash receipts are based on an expectation of future interest rates derived from observed market interest rate forward curves. Since these inputs are observable in active markets over the terms that the instruments are held, the derivatives are classified as Level 2 in the hierarchy. See Note 8. The fair value of Contrail's earnout is valued using an income approach and is classified as Level 3 in the hierarchy. See Note 21. The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, restricted cash, accounts receivable, notes receivable and accounts payable approximate their fair values at March 31, 2025 and 2024.

4.    INVENTORIES

Inventories consisted of the following (in thousands):Year Ended March 31,20252024Inventories:Raw materials6,928 6,174 Work in process2,342 5,244 Finished goods5,358 4,387 Aircraft parts28,794 49,522 Total inventories43,422 65,327 Reserves(4,906)(4,607)Total inventories, net of reserves$38,516 $60,720 

A write-down of $1.5 million was recorded on the inventory of the commercial aircraft, engines and parts segment during the fiscal year ended March 31, 2025. The write-down was attributable to our evaluation of the carrying value of inventory as of March 31, 2025, where we compared its cost to its net