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 September 30, 2022

☐	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 1-10324

THE INTERGROUP CORPORATION

(Exact name of registrant as specified in its charter)

delaware		13-3293645
(State or other jurisdiction of		(I.R.S. Employer
Incorporation or organization)		Identification No.)

1516 S. Bundy Dr., Suite 200, Los Angeles, California 90025

(Address of principal executive offices) (Zip Code)

(310) 889-2500

(Registrant’s telephone number, including area code)

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 (Section 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, a smaller reporting company or an emerging growth company.

	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 Act):

☐ Yes ☒ No

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common stock		INTG		NASDAQ CAPITAL MARKET

The number of shares outstanding of registrant’s Common Stock, as of November 4, 2022 was 2,217,414

TABLE OF CONTENTS

		Page
	PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements.

	Condensed Consolidated Balance Sheets as of September 30, 2022 (unaudited) and June 30, 2022	3
	Condensed Consolidated Statements of Operations for the Three Months ended September 30, 2022 and 2021 (unaudited)	4
	Condensed Consolidated Statements of Shareholders’ Deficit for the Three Months ended September 30, 2022 and 2021 (unaudited)	5
	Condensed Consolidated Statements of Cash Flows for the Three Months ended September 30, 2022 and 2021 (unaudited)	6
	Notes to the Condensed Consolidated Financial Statements (unaudited)	7-16

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	17-22

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	22

Item 4.	Controls and Procedures.	23

	PART II – OTHER INFORMATION

Item 1.	Legal Proceedings.	23

Item 1A.	Risk Factors.	23

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	23

Item 3.	Defaults Upon Senior Securities.	23

Item 4.	Mine Safety Disclosures.	24

Item 5.	Other Information.	24

Item 6.	Exhibits.	24

Signatures		25

- 2 -

PART I

FINANCIAL INFORMATION

Item 1 - Condensed Consolidated Financial Statements

THE INTERGROUP CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

	September 30, 2022
As of	(unaudited)			June 30, 2022
ASSETS
Investment in Hotel, net	$	38,248,000		$	37,267,000
Investment in real estate, net		48,147,000			48,025,000
Investment in marketable securities		10,687,000			11,049,000
Cash and cash equivalents		12,219,000			14,367,000
Restricted cash		8,662,000			8,982,000
Other assets, net		3,439,000			2,744,000
Deferred tax assets, net		3,670,000			3,612,000
Total assets	$	125,072,000		$	126,046,000

LIABILITIES AND SHAREHOLDERS’ DEFICIT
Liabilities:
Accounts payable and other liabilities - Hotel	$	9,291,000		$	7,691,000
Accounts payable and other liabilities		3,033,000			2,715,000
Due to securities broker		-			490,000
Obligations for securities sold		-			449,000
Related party notes payable		3,379,000			3,521,000
Mortgage notes payable - Hotel, net		108,249,000			108,747,000
Mortgage notes payable - real estate, net		85,202,000			85,437,000
Total liabilities		209,154,000			209,050,000

Shareholders’ deficit:
Preferred stock, $.01 par value, 100,000 shares authorized; none issued		-			-
Common stock, $.01 par value, 4,000,000 shares authorized; 3,459,888 and 3,459,888 issued; 2,218,541 and 2,236,180 outstanding, respectively		33,000			33,000
Additional paid-in capital		3,258,000			3,277,000
Accumulated deficit		(46,315,000	)		(46,116,000	)
Treasury stock, at cost, 1,241,347 and 1,223,708 shares, respectively		(20,196,000	)		(19,324,000	)
Total InterGroup shareholders’ deficit		(63,220,000	)		(62,130,000	)
Noncontrolling interest		(20,862,000	)		(20,874,000	)
Total shareholders’ deficit		(84,082,000	)		(83,004,000	)

Total liabilities and shareholders’ deficit	$	125,072,000		$	126,046,000

The accompanying notes are an integral part of these (unaudited) condensed consolidated financial statements.

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THE INTERGROUP CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

For the three months ended September 30,	2022			2021
Revenues:
Hotel	$	12,310,000		$	6,805,000
Real estate		4,078,000			4,116,000
Total revenues		16,388,000			10,921,000
Costs and operating expenses:
Hotel operating expenses		(9,306,000	)		(6,333,000	)
Real estate operating expenses		(2,191,000	)		(2,074,000	)
Depreciation and amortization expenses		(1,329,000	)		(1,148,000	)
General and administrative expenses		(699,000	)		(810,000	)

Total costs and operating expenses		(13,525,000	)		(10,365,000	)

Income from operations		2,863,000			556,000

Other (expense) income:
Interest expense - mortgages		(2,222,000	)		(2,242,000	)
Net loss on marketable securities		(810,000	)		(1,818,000	)
Net loss on marketable securities - Comstock		-			(350,000	)
Dividend and interest income		175,000			187,000
Trading and margin interest expense		(265,000	)		(354,000	)
Total other expense, net		(3,122,000	)		(4,577,000	)

Loss before income taxes		(259,000	)		(4,021,000	)
Income tax benefit		58,000			1,115,000
Net loss		(201,000	)		(2,906,000	)
Less: Net loss attributable to the noncontrolling interest		2,000			745,000
Net loss attributable to The InterGroup Corporation	$	(199,000	)	$	(2,161,000	)

Net loss per share
Basic	$	(0.09	)	$	(1.31	)
Diluted	$	(0.09	)	$	(1.31	)

Net loss per share attributable to The InterGroup Corporation
Basic	$	(0.09	)	$	(0.97	)
Diluted	$	(0.09	)	$	(0.97	)

Weighted average number of basic common shares outstanding		2,231,228			2,222,904
Weighted average number of diluted common shares outstanding		2,482,423			2,560,499

The accompanying notes are an integral part of these (unaudited) condensed consolidated financial statements.

- 4 -

THE INTERGROUP CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ DEFICIT

(unaudited)


	Common Stock				Additional Paid-in			Accumulated			Treasury			InterGroup Shareholders’			Noncontrolling			Total Shareholders’
	Shares		Amount		Capital			Deficit			Stock			Deficit			Interest			Deficit
Balance at July 1, 2022		3,459,888	$	33,000	$	3,277,000		$	(46,116,000	)	$	(19,324,000	)	$	(62,130,000	)	$	(20,874,000	)	$	(83,004,000	)
Net loss		-		-		-			(199,000	)		-			(199,000	)		(2,000	)		(201,000	)
Investment in Portsmouth		-		-		(19,000	)		-			-			(19,000	)		14,000			(5,000	)
Purchase of treasury stock		-		-		-			-			(872,000	)		(872,000	)		-			(872,000	)
Balance at September 30, 2022		3,459,888

SEC Form 10-Q filed by Intergroup Corporation