INTERGROUP CORP

INTERGROUP CORP Annual Report - Plain English Breakdown
What you need to know as an everyday investor

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1. What does INTERGROUP do, and how was their year?

INTERGROUP runs hotels and owns real estate. This year, hotel revenue grew 11% to $46.4 million, and real estate income also rose 11% to $18 million. Despite this growth, they still lost $3.2 million overall—though that’s an improvement from last year’s $5.2 million loss. The takeaway: Sales are climbing, but profits aren’t here yet.

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2. Money talk: Are they growing?

• Total revenue: $64.4 million (up 11% from last year’s $58.1 million)
• Net loss: $3.2 million (38% smaller than last year’s $5.2 million loss)
• The bottom line: Both hotels and real estate grew, but high costs kept the company unprofitable.

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3. Biggest wins 👍 and challenges 👎

• Wins:
  • Hotels added $4.5 million in new revenue.
  • Losses dropped by nearly $2 million year-over-year.
• Challenges:
  • Still losing money despite growth.
  • Shareholders’ deficit (debts exceeding assets) grew to $114 million, up 7% from $106 million.

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4. Financial health: Stable or shaky?

• Red flag: Negative equity of $114 million—like owing more on a house than it’s worth.
• Bright spot: Total debts dropped slightly to $104 million (from $108 million).
• Verdict: Shaky. The company’s debts outweigh its assets significantly.

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5. Risks to watch 🚨

• Continued losses could make borrowing harder or scare off investors.
• $26 million owed to outside investors (non-controlling interests).
• A real estate market downturn could slash property values.

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6. How do they compare to competitors?

• Size: Small player—their total hotel revenue equals about two mid-sized hotels.
• Unique angle: Real estate assets provide a safety net.
• Efficiency issue: Needs 18% more revenue just to break even.

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7. Leadership or strategy changes?

No CEO changes this year. Their strategy remains focused on growing revenue to eventually outpace losses.

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8. What’s next? Key 2024 questions

• Can losses keep shrinking at the current rate?
• They’ll need 2+ years of similar progress to reach profitability.
• Will investors tolerate the $114 million deficit?

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9. Market trends affecting INTERGROUP

• Opportunity: Post-pandemic travel demand boosting hotels.
• Threat: Rising interest rates could lower property values.

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Bottom line for investors

INTERGROUP is a high-risk, high-reward bet. The 11% revenue growth shows potential, but the massive $114 million deficit and ongoing losses are major red flags. Consider only if:

1. You believe they can sustain growth and fix their balance sheet.
2. You’re comfortable with volatility and potential long waits for returns.

Not financial advice. Always do your own research or consult an advisor.

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Data sourced from 2023 reports. Simplified for clarity.

Why this matters: While INTERGROUP improved this year, the lack of detailed plans for reducing debt or accelerating profitability in their reports suggests limited transparency. Proceed with caution.