esca20260630

esca20260630_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2026 or

☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from _____ to _____

Commission File Number 0-6966

ESCALADE, INCORPORATED

(Exact name of registrant as specified in its charter)

Indiana

(State or Other Jurisdiction of Incorporation or

Organization)

13-2739290

(I.R.S. Employer Identification No.)

817 Maxwell Ave, Evansville, Indiana

(Address of principal Executive Office)

47711

(Zip Code)

812-467-1334

(Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, No Par Value	ESCA	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐

Accelerated filer ☒

Non-accelerated filer ☐

Smaller reporting company ☒

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding at July 29, 2026
Common, no par value	13,766,074

INDEX

		Page No.
Part I.	Financial Information:

Item 1 -	Financial Statements:

	Consolidated Condensed Balance Sheets as of June 30, 2026, December 31, 2025, and June 30, 2025	3

	Consolidated Condensed Statements of Operations for the Three Months and Six Months Ended June 30, 2026 and June 30, 2025	4

	Consolidated Condensed Statements of Stockholders’ Equity for the Three Months and Six Months Ended June 30, 2026 and June 30, 2025	5

	Consolidated Condensed Statements of Cash Flows for the Six Months Ended June 30, 2026 and June 30, 2025	6

	Notes to Consolidated Condensed Financial Statements	7

Item 2 -	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13

Item 3 -	Quantitative and Qualitative Disclosures About Market Risk	16

Item 4 -	Controls and Procedures	16

Part II.	Other Information

Item 1 -	Legal Proceedings	16

Item 1A -	Risk Factors	16

Item 2 -	Unregistered Sales of Equity Securities and Use of Proceeds	17

Item 6 -	Exhibits	18

	Signature	18

PART I - FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

ESCALADE, INCORPORATED AND SUBSIDIARIES

CONSOLIDATED CONDENSED BALANCE SHEETS

All Amounts in Thousands Except Share Information	June 30, 2026		December 31, 2025		June 30, 2025
	(Unaudited)		(Audited)		(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents	$	16,392	$	11,878	$	10,422
Receivables, less allowance of $1,122; $1,226; and $595; respectively		44,612		46,315		41,926
Inventories		71,184		68,474		72,672
Prepaid expenses		3,118		3,351		2,449
Prepaid income tax		--		557		402
Other current assets		9,042		--		--
TOTAL CURRENT ASSETS		144,348		130,575		127,871

Property, plant and equipment, net		22,303		22,355		21,827
Operating lease right-of-use assets		1,233		1,276		1,428
Intangible assets, net		24,284		25,445		24,703
Goodwill		42,326		42,326		42,326
Other assets		24		132		184
TOTAL ASSETS	$	234,518	$	222,109	$	218,339

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt	$	14,881	$	7,143	$	7,143
Trade accounts payable		15,342		9,150		14,120
Accrued liabilities		12,536		13,680		9,086
Income tax payable		1,571		--		--
Current operating lease liabilities		625		510		496
TOTAL CURRENT LIABILITIES		44,955		30,483		30,845

Other Liabilities:
Long‑term debt		--		11,309		14,881
Deferred income tax liability		6,303		6,303		3,302
Operating lease liabilities		636		798		973
TOTAL LIABILITIES		51,894		48,893		50,001

Stockholders' Equity:
Preferred stock:
Authorized 1,000,000 shares; no par value, none issued		--		--		--
Common stock:
Authorized 30,000,000 shares; no par value, issued and outstanding – 13,766,074; 13,696,311; and 13,803,745; shares respectively		2,769		3,013		3,251
Retained earnings		179,855		170,203		165,087
TOTAL STOCKHOLDERS' EQUITY		182,624		173,216		168,338
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	234,518	$	222,109	$	218,339

See notes to Consolidated Condensed Financial Statements.

ESCALADE, INCORPORATED AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)

	Three Months Ended						Six Months Ended
All Amounts in Thousands Except Per Share Data	June 30, 2026			June 30, 2025			June 30, 2026			June 30, 2025

Net Sales	$	57,702		$	54,333		$	113,487		$	109,812

Costs and Expenses
Cost of products sold		42,588			40,896			81,224			81,585
Selling, administrative and general expenses		12,476			10,249			23,209			20,820
Amortization		579			567			1,160			1,134
Tariff recovery		(9,875	)		--			(9,875	)		--

Operating Income		11,934			2,621			17,769			6,273

Other Income (Expense)
Interest expense		(176	)		(213	)		(364	)		(457	)
Interest income		426			--			500			--
Other income		18			51			31			82

Income Before Income Taxes		12,202			2,459			17,936			5,898

Provision for Income Taxes		2,771			634			4,124			1,454

Net Income	$	9,431		$	1,825		$	13,812		$	4,444

Earnings Per Share Data:
Basic earnings per share	$	0.68		$	0.13		$	1.00		$	0.32
Diluted earnings per share	$	0.68		$	0.13		$	1.00		$	0.32

Dividends declared	$	0.1525		$	0.1500		$	0.3025		$	0.3000

See notes to Consolidated Condensed Financial Statements.

ESCALADE, INCORPORATED AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENT OF STOCKHOLDERS’ EQUITY (UNAUDITED)

	Common Stock						Retained
All Amounts in Thousands	Shares			Amount			Earnings			Total

Balances at March 31, 2025		13,756		$	3,428		$	165,337		$	168,765

Net income		--			--			1,825			1,825
Expense of restricted stock units		--			495			--			495
Settlement of restricted stock units		58			--			--			--
Issuance of restricted stock awards		35			--			--			--
Dividends declared		--			--			(2,075	)		(2,075	)
Purchase of stock		(53	)		(790	)		--			(790	)
Issuance of common stock for service		8			118			--			118

Balances at June 30, 2025		13,804		$	3,251		$	165,087		$	168,338


Balances at December 31, 2024		13,733		$	4,218		$	164,779		$	168,997

Net income		--			--			4,444			4,444
Expense of restricted stock units		--			962			--			962
Settlement of restricted stock units		165			--			--			--
Issuance of restricted stock awards		35			--			--			--
Dividends declared		--			--			(4,136	)		(4,136	)
Purchase of stock		(145	)		(2,171	)		--			(2,171	)
Issuance of common stock for service		16			242			--			242

Balances at June 30, 2025		13,804		$	3,251		$	165,087		$	168,338

	Common Stock						Retained
All Amounts in Thousands	Shares			Amount			Earnings			Total

Balances at March 31, 2026		13,762		$	3,306		$	172,530		$	175,836

Net income		--			--			9,431			9,431
Expense of restricted stock units		--			463			--			463
Settlement of restricted stock units		59			--			--			--
Dividends declared		--			--			(2,106	)		(2,106	)
Purchase of stock		(55	)		(1,000	)		--			(1,000	)

Balances at June 30, 2026		13,766		$	2,769		$	179,855		$	182,624


Balances at December 31, 2025		13,696		$	3,013		$	170,203		$	173,216

Net income		--			--			13,812			13,812
Expense of restricted stock units		--			875			--			875
Settlement of restricted stock units		131			--			--			--
Dividends declared		--			--			(4,160	)		(4,160	)
Purchase of stock		(72	)		(1,281	)		--			(1,281	)
Issuance of common stock for service		11			162			--			162

Balances at June 30, 2026		13,766		$	2,769		$	179,855		$	182,624

See notes to Consolidated Condensed Financial Statements.

ESCALADE, INCORPORATED AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)

	Six Months Ended
All Amounts in Thousands	June 30, 2026			June 30, 2025

Operating Activities:
Net income	$	13,812		$	4,444
Depreciation and amortization		2,503			2,501
Allowance for credit losses		376			225
Stock-based compensation		875			962
Loss on disposal of assets		--			3
Common stock issued in lieu of bonus to officers		162			124
Director stock compensation		--			118
Changes in assets and liabilities		(2,912	)		8,706
Net cash provided by operating activities		14,816			17,083

Investing Activities:
Purchase of property and equipment		(1,290	)		(976	)
Net cash used in investing activities		(1,290	)		(976	)

Financing Activities:
Proceeds from issuance of long-term debt		568			9,046
Payments on long-term debt		(4,139	)		(12,618	)
Cash dividends paid		(4,160	)		(4,136	)
Purchase of stock		(1,281	)		(2,171	)
Net cash used in financing activities		(9,012	)		(9,879	)
Net increase in cash and cash equivalents		4,514			6,228
Cash and cash equivalents, beginning of period		11,878			4,194
Cash and cash equivalents, end of period	$	16,392		$	10,422

Supplemental Cash Flows Information
Interest paid	$	313		$	428
Income taxes paid, net	$	1,996		$	1,689

See notes to Consolidated Condensed Financial Statements.

ESCALADE, INCORPORATED AND SUBSIDIARIES

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

Note A – Summary of Significant Accounting Policies

Presentation of Consolidated Condensed Financial Statements – The significant accounting policies followed by the Company and its wholly owned subsidiaries for interim financial reporting are consistent with the accounting policies followed for its annual financial reporting. All adjustments that are of a normal recurring nature and are in the opinion of management necessary for a fair statement of the results for the periods reported have been included in the accompanying consolidated condensed financial statements. The consolidated condensed balance sheet of the Company as of December 31, 2025 has been derived from the audited consolidated balance sheet of the Company as of that date. Certain information and note disclosures normally included in the Company’s annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) have been condensed or omitted. These consolidated condensed financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Form 10-K annual report for 2025 filed with the Securities and Exchange Commission.

Note B ‑ Seasonal Aspects

The results of operations for the three and six months ended June 30, 2026 and June 30, 2025 are not necessarily indicative of the results to be expected for the full year.

Note C ‑ Inventories

In thousands	June 30, 2026		December 31, 2025		June 30, 2025

Raw materials	$	3,925	$	2,735	$	3,843
Work in progress		3,224		2,940		2,936
Finished goods		64,035		62,799		65,893
	$	71,184	$	68,474	$	72,672

Note D – Fair Values of Financial Instruments

Accounting Standard Codification (“ASC”) 820, “Fair Value Measurement and Disclosures,” outlines a valuation framework and creates a fair value hierarchy for assets and liabilities as follows:

Level 1: Observable inputs such as quoted prices in active markets;

Level 2: Inputs other than quoted prices in active markets that are either directly or indirectly observable; and

Level 3: Unobservable inputs for which little or no market data exists, therefore requiring the Company to develop its own assumptions.

Due to their short-term nature, the fair value of cash and cash equivalents, accounts receivable, accounts payable and certain other liabilities approximated their carrying values at June 30, 2026, December 31, 2025 and June 30, 2025. The Company believes the carrying value of borrowings under our senior secured revolving credit facility, due to variable rate interest, adequately reflects the fair value of these instruments.

The Company discloses the fair value of its term loan using Level 2 inputs, which are estimated using treasury rates for a similar instrument, as follows:

	June 30, 2026				December 31, 2025				June 30, 2025
In thousands	Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value

Term Loan Facility	$	14,881	$	14,510	$	18,452	$	17,689	$	22,024	$	20,744

Note E – Stock Compensation

The fair value of stock-based compensation is recognized in accordance with the provisions of FASB ASC 718, Stock Compensation.

For the three and six months ended June 30, 2026, the Company recognized stock based compensation expense of $463 thousand and $875 thousand, respectively, compared to stock based compensation expense of $495 thousand and $962 thousand for the same periods in the prior year.

At June 30, 2026 and June 30, 2025, there was $2.3 million and $2.8 million, respectively, in unrecognized stock-based compensation expense related to non-vested stock awards. The unrecognized compensation expense of unvested restricted stock awards not yet recognized as of June 30, 2026 is expected to be recognized over the weighted average period of 1.5 years.

During the six months ended June 30, 2026, the Company awarded 20,000 restricted stock units to directors and 116,691 restricted stock units to employees. The restricted stock units awarded to directors time vest over two years (one-half one year from grant date and one-half two years from grant date) provided that the director is still a director of the Company at the vest date. Director restricted stock units are subject to forfeiture, except for termination of services as a result of retirement, death or disability, if on the vesting date the director no longer holds a position with the Company. All of the 2026 restricted stock units awarded to employees time vest over three years (one-third one year from grant, one-third two years from grant and one-third three years from grant) provided that the employee continues to serve as an employee, director or consultant of the Company on the vesting date.

Note F ‑ Segment Information

The Company operates as one operating segment. The Company’s chief operating decision maker (“CODM”) is its president and chief executive officer, who reviews financial information presented on a consolidated basis. The CODM uses consolidated net sales and consolidated net income to assess financial performance and allocate resources.

Reconciliation to net income:

	Three Months Ended						Six Months Ended
In Thousands	June 30, 2026			June 30, 2025			June 30, 2026			June 30, 2025

Net Sales
Sporting Goods	$	57,702		$	54,333		$	113,487		$	109,812
Total Net Sales	$	57,702		$	54,333		$	113,487		$	109,812

Sporting Goods Segment Operating Expenses:
Cost of products sold	$	42,588		$	40,896		$	81,224		$	81,585
Other operating expenses		2,379			10,205			12,912			20,519
Unallocated corporate expense		801			611			1,582			1,435
Total Operating Income	$	11,934		$	2,621		$	17,769		$	6,273

Sporting Goods Segment Other Income (Expense):
Interest expense		(176	)		(213	)		(364	)		(457	)
Interest income		426			--			500			--
Other income		18			51			31			82
Total Income Before Income Taxes	$	12,202		$	2,459		$	17,936		$	5,898
Sporting Goods Segment provision for income taxes		3,573			844			5,363			2,016
Unallocated benefit for taxes		(802	)		(210	)		(1,239	)		(562	)
Total Net Income	$	9,431		$	1,825		$	13,812		$	4,444

Identifiable Assets
Sporting Goods	$	217,195		$	207,144		$	217,195		$	207,144
Corporate		17,323			11,195			17,323			11,195
Total Identifiable Assets	$	234,518		$	218,339		$	234,518		$	218,339

Other operating expenses primarily include selling, general and administrative expenses and tariff recovery attributable to the Sporting Goods segment.

Note G – Dividend Payment

On January 12, 2026, the Company paid a quarterly dividend of $0.15 per common share to all shareholders of record on January 5, 2026. The total amount of the dividend was approximately $2.1 million and was charged against retained earnings.

On April 13, 2026, the Company paid a quarterly dividend of $0.1525 per common share to all shareholders of record on April 6, 2026. The total amount of the dividend was approximately $2.1 million and was charged against retained earnings.

On July 13, 2026, the Company paid a quarterly dividend of $0.1525 per common share to all shareholders of record on July 6, 2026. The total amount of the dividend was approximately $2.1 million and was charged against retained earnings.

Note H ‑ Earnings Per Share

The shares used in computation of the Company’s basic and diluted earnings per common share are as follows:

	Three Months Ended				Six Months Ended
In thousands	June 30, 2026		June 30, 2025		June 30, 2026		June 30, 2025

Weighted average common shares outstanding		13,786		13,769		13,752		13,742
Dilutive effect of restricted stock units		115		139		102		141
Weighted average common shares outstanding, assuming dilution		13,901		13,908		13,854		13,883

Note I – New Accounting Standards and Changes in Accounting Principles

With the exception of that discussed below, there have been no recent accounting pronouncements or changes in accounting pronouncements during the three and six months ended June 30, 2026, as compared to the recent accounting pronouncements described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, that are of significance, or potential significance to the Company.

In July 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2025-05, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The amendments clarify the application of the current expected credit losses (CECL) model to trade receivable and contract assets and are intended to improve consistency in the measurement of expected credit losses. The guidance is effective for fiscal years beginning after December 15, 2025, including interim periods within those fiscal years. The Company adopted ASU 2025-05 effective January 1, 2026. The adoption of ASU 2025-05 did not have a material impact on the Company’s condensed consolidated financial statements, financial condition, or results of operations.

Note J – Revenue from Contracts with Customers

Revenue Recognition – Revenue is recognized when a contract exists with a customer that specifies the goods to be provided at an agreed upon sales price and when the performance obligations under the terms of the contract are satisfied; generally this occurs with the transfer of control of our goods at a point in time based on shipping terms and transfer of title. Sales are made on normal and customary short-term credit terms or upon delivery of point-of-sale transactions. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods. The Company expenses incremental costs of obtaining a contract due to the short-term nature of the contracts. These costs are recorded in selling, general and administrative expenses in the accompanying consolidated statements of operations. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. Shipping and handling fees charged to customers are reported within revenue.

The Company enters into contractual arrangements with customers in the form of customer orders that specify goods, quantity, pricing, and associated order terms. The Company does not have long-term contracts that are satisfied over time. Due to the nature of the contracts, no significant judgment exists in relation to the identification of the customer contract, satisfaction of the performance obligations, or transaction price.

Gross-to-net sales adjustments – We recognize revenue net of various sales adjustments to arrive at net sales as reported on the statement of operations. These adjustments are referred to as gross-to-net sales adjustments and primarily fall into one of three categories: returns, warranties and customer allowances.

Returns – The Company records an accrued liability and reduction in sales for estimated product returns based upon historical experience. An accrued liability and reduction in sales is also recorded for approved return authorizations that have been communicated by the customer.

Warranties – Limited warranties are provided on certain products for varying periods. We record an accrued liability and reduction in sales for estimated future warranty claims based upon historical experience and management’s estimate of the level of future claims. Changes in the estimated amounts recognized in prior years are recorded as an adjustment to the accrued liability and sales in the current year. The accrued liability amount attributable to warranties was $578 thousand as of June 30, 2026. There were no changes to the accrual due to a change in estimate during the current period.

Customer Allowances – Customer allowances are common practice in the industries in which the Company operates. These agreements are typically in the form of advertising subsidies, volume rebates and catalog allowances and are accounted for as a reduction to gross sales. The Company reviews such allowances on an ongoing basis and accruals are adjusted, if necessary, as additional information becomes available.

Contract Balances – Amounts relating to returns and customer allowances create contract liabilities, which were $5,134 thousand and $5,025 thousand as of June 30, 2026 and June 30, 2025, respectively, and $5,324 thousand and $6,708 thousand as of December 31, 2025 and December 31, 2024, respectively.

Disaggregation of Revenue – We generate revenue from the sale of widely recognized sporting goods brands in basketball goals, archery, indoor and outdoor game recreation and fitness products. These products are sold through multiple sales channels that include: mass merchants, specialty dealers, key on-line retailers (“E-commerce”) and international. The following table depicts the disaggregation of revenue according to sales channel:

	Three Months Ended				Six Months Ended
All Amounts in Thousands	June 30, 2026		June 30, 2025		June 30, 2026		June 30, 2025

Gross Sales by Channel:
Mass Merchants	$	16,702	$	17,332	$	34,486	$	37,510
Specialty Dealers		18,568		17,644		41,568		38,211
E-commerce		24,853		22,500		41,641		38,764
International		3,328		2,792		5,813		6,490
Other		843		845		1,634		1,646
Total Gross Sales		64,294		61,113		125,142		122,621

Less: Gross-to-Net Sales Adjustments
Returns		1,625		1,547		2,646		3,087
Warranties		130		159		381		532
Customer Allowances		4,837		5,074		8,628		9,190
Total Gross-to-Net Sales Adjustments		6,592		6,780		11,655		12,809
Total Net Sales	$	57,702	$	54,333	$	113,487	$	109,812

Note K – Leases

We have operating leases for office, manufacturing and distribution facilities as well as for certain equipment. Our leases have remaining lease terms of 1 year to 5 years. As of June 30, 2026, the Company has not entered into any lease arrangements classified as a finance lease.

We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current operating lease liabilities and operating lease liabilities on our consolidated balance sheet. The Company has elected an accounting policy to not recognize short-term leases (one year or less) on the balance sheet. The Company also elected the package of practical expedients which applies to leases that commenced before the adoption date. By electing the package of practical expedients, the Company did not need to reassess the following; whether any existing contracts are or contain leases, the lease classification for any existing leases and initial direct costs for any existing leases.

ROU assets and operating lease liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. When the implicit rate of the lease is not provided or cannot be determined, we use our incremental borrowing rate based on the information available at the commencement date to determine the present value of future payments. Lease terms may include options to extend or terminate the lease and are recognized in the presentation of the ROU assets and operating lease liabilities when it is reasonably certain that we will exercise those options. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Variable lease costs include payment for taxes and common area maintenance charges.

Components of lease expense and other information is as follows:

	Three Months Ended				Six Months Ended
All Amounts in Thousands	June 30, 2026		June 30, 2025		June 30, 2026		June 30, 2025

Lease Expense
Operating Lease Cost	$	167	$	153	$	334	$	286
Short-term Lease Cost		178		314		326		542
Variable Lease Cost		63		58		105		100
Total Operating Lease Cost	$	408	$	525	$	765	$	928

Operating Lease – Operating Cash Flows	$	165	$	155	$	337	$	291
New ROU Assets – Operating Leases	$	--	$	487	$	246	$	487

Other information about lease amounts recognized in our consolidated condensed financial statements are summarized as follows:

	Period Ended
All Amounts in Thousands	June 30, 2026			June 30, 2025

Weighted Average Remaining Lease Term – Operating Leases (in years)		2.59			3.20
Weighted Average Discount Rate – Operating Leases		6.81	%		6.61	%

Future minimum lease payments under non-cancellable leases as of June 30, 2026 were as follows:

All Amounts in Thousands

Year 1	$	351
Year 2		583
Year 3		217
Year 4		150
Year 5		70
Thereafter		8
Total future minimum lease payments		1,379
Less imputed interest		(118	)
Total	$	1,261

Reported as of June 30, 2026
Current operating lease liabilities		625
Long-term operating lease liabilities		636
Total	$	1,261

Note L – Commitments and Contingencies

The Company is involved in litigation arising in the normal course of its business, but the Company does not believe the disposition or ultimate resolution of such claims or lawsuits will have a material adverse effect on the business or financial condition of the Company. Based on current information, available insurance coverage and establ