The InterGroup(INTG) - 2026 Q1 - Quarterly Report

Financial Performance - As of September 30, 2025, the Company reported a net loss of $535,000, an increase from a net loss of $398,000 in the same period of 2024[114] - Hotel revenues for the three months ended September 30, 2025, were $12,418,000, up 5.1% from $11,820,000 in 2024, with an operating income of $1,937,000 before interest, depreciation, and amortization[116] - Revenue from real estate operations rose to $5,495,000 in Q3 2025, compared to $5,086,000 in Q3 2024, driven by stronger multifamily occupancy[119] Operational Metrics - The average daily room rate increased to $218 in Q3 2025 from $210 in Q3 2024, while occupancy decreased to 95% from 96%[118] - The Company recorded a net gain on marketable securities of $136,000 for Q3 2025, compared to a net gain of $129,000 in Q3 2024[120] Cash and Securities - The Company had cash and cash equivalents of $5,054,000 as of September 30, 2025, slightly down from $5,092,000 at June 30, 2025[124] - Marketable securities totaled $966,000 as of September 30, 2025, compared to $969,000 at June 30, 2025[124] Debt and Interest Expenses - Total mortgage and subordinated notes payable amounts to $197,458,000 for the current year, with projections of $930,000 in 2027 and $106,663,000 in 2028[139] - Interest expenses for the current year are reported at $38,526,000, with a forecast of $8,711,000 in 2027 and $14,091,000 in 2028[139] Strategic Initiatives - The Company is actively marketing a non-core 12-unit multifamily property in Los Angeles, which could provide additional liquidity upon sale[127] - The Company continues to evaluate strategic alternatives in response to challenges in the San Francisco hospitality sector[134] Tax and Impairment Considerations - The company assesses the realizability of deferred tax assets each reporting period, with a valuation allowance recorded when it is more-likely-than-not that some or all DTAs will not be realized[144] - Cumulative pre-tax losses over the preceding three years are considered significant negative evidence for the realizability of deferred tax assets[145] - There were no indicators of impairment for hotel investments or definite-lived intangible assets for the three months ended September 30, 2025[148] - The company has not recorded any impairment losses for the three months ended September 30, 2025, and 2024, respectively[148] Compensation and Reporting - Stock-based compensation is measured based on estimated grant date fair values, using the Black Scholes option pricing model for employee stock options[149] - Management views the impact of inflation on the company's income as not material for the last two fiscal years, as hotel room rates can be adjusted accordingly[140] - The company is classified as a "smaller reporting company" and is not required to provide certain market risk disclosures[150]