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Portsmouth Square Inc Net Debt / EBITDA jumped on 18.5x from 7.8x to 26.3x in 2020 while Revenue dropped on 28.5%

09/09/2020 • About Portsmouth Square Inc ($PRSI) • By InTwits

Portsmouth Square Inc reported FY2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
  • Portsmouth Square Inc is a company in decline: FY2020 revenue growth was -28.5%, 5 years revenue CAGR was -5.5%
  • EBITDA Margin is quite volatile: 10.7% in FY2020, 24.1% in FY2019, 37.9% in FY2018, 23.5% in FY2017, 8.9% in FY2016
  • Portsmouth Square Inc has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.7%. At the same time it's in pair with industry average of 3.0%
  • CAPEX is quite volatile: $1m in FY2020, $1m in FY2019, $0m in FY2018, $0m in FY2017, $4m in FY2016
  • The company has potentially unprofitable business model: ROIC is 5.4%
  • It operates with high leverage: Net Debt/EBITDA is 26.3x while industry average is 28.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.

Revenue and profitability


Portsmouth Square Inc's Revenue dropped on 28.5%. Revenue decline showed acceleration in FY20Q4 - it was 91.4% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 0.57 pp from 16.0% to 16.6% in FY2020. During FY2016-FY2020 EBITDA Margin topped in FY2018 at 37.9% and was declining since that time.

SG&A as a % of Revenue showed almost no change in FY2020.

Net Income margin dropped on 11.2 pp from 4.3% to -6.8% in FY2020. During the last 5 years Net Income margin topped in FY2018 at 6.4% and was declining since that time.

Investments (CAPEX, working capital and M&A)


In FY2020 Portsmouth Square Inc had CAPEX/Revenue of 3.0%. The company's CAPEX/Revenue increased on 2.4 pp from 0.61% in FY2017 to 3.0% in FY2020. It's average CAPEX/Revenue for the last three years was 1.9%. During the last 5 years CAPEX as a % of Revenue bottomed in FY2018 at 0.37% and was growing since that time.

Leverage (Debt)


Debt level is 26.3x Net Debt / EBITDA and 27.4x Debt / EBITDA. Net Debt / EBITDA surged on 18.5x from 7.8x to 26.3x in FY2020. Debt increased slightly on 1.7% while cash dropped on 51.9%. During the last 5 years Net Debt/EBITDA bottomed in FY2018 at 5.4x and was growing since that time.

Portsmouth Square Inc has short term refinancing risk: cash is only 38.2% of short term debt.

Financial and operational results


FY ended 06/30/2020

Portsmouth Square Inc ($PRSI) key annual financial indicators

mln. $201620172018201920202020/2019
P&L
Revenue58.56654.33457.09959.88142.839-28.5%
SG&A0.7120.6351.2151.0480.923-11.9%
EBITDA5.21212.75221.62314.4114.564-68.3%
Net Income-4.7920.2453.6452.599-2.933-212.9%
Balance Sheet
Cash3.3782.0497.6239.7894.710-51.9%
Short Term Debt11.24610.2098.6418.22112.32349.9%
Long Term Debt116.160115.615115.727114.573112.544-1.8%
Cash flow
Capex4.2310.3290.2101.3991.291-7.7%
Ratios
Revenue growth3.1%-7.2%5.1%4.9%-28.5%
EBITDA growth-43.1%144.7%69.6%-33.4%-68.3%
EBITDA Margin8.9%23.5%37.9%24.1%10.7%-13.4%
SG&A, % of revenue1.2%1.2%2.1%1.8%2.2%0.4%
Net Income Margin-8.2%0.5%6.4%4.3%-6.8%-11.2%
CAPEX, % of revenue7.2%0.6%0.4%2.3%3.0%0.7%
ROIC5.0%21.9%42.3%25.8%5.4%-20.4%
Net Debt/EBITDA23.8x9.7x5.4x7.8x26.3x18.5x

Portsmouth Square Inc ($PRSI) key quoterly financial indicators

mln. $FY20Q1FY20Q2FY20Q3FY20Q4 YoY change
P&L
Revenue1515111 -2.4%6.5%-27.2%-91.4%
EBITDA431-3 -19.5%14.1%-74.1%-197.0%
Net Income10-1-3 -37.5%--253.6%-607.1%
Balance Sheet
Cash10765 7.5%-18.8%-35.2%-51.9%
Short Term Debt10012 -94.0%-97.5%-100.0%49.9%
Long Term Debt122121121113 5.5%5.3%5.2%-1.8%
Ratios
EBITDA Margin 25.1% 19.6% 8.6% -256.0% -5.3%1.3%-15.6%-278.6%
Net Income Margin 5.4% 2.6% -10.0% -241.4% -3.0%2.9%-14.7%-245.4%

Peers in Hotels, Resorts & Cruise Lines


Below you can find Portsmouth Square Inc benchmarking vs. other companies in Hotels, Resorts & Cruise Lines industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.

Top companies by Revenue growth, %

Top  FY2016 FY2017 FY2018 FY2019 FY2020
Santa Fe Financial Corp ($SFEF)--7.3%5.0%4.8%-28.3%
 
Median (1 company)--7.3%5.0%4.8%-28.3%
Portsmouth Square Inc ($PRSI)--7.2%5.1%4.9%-28.5%


Top companies by EBITDA margin, %

Top  FY2016 FY2017 FY2018 FY2019 FY2020
Santa Fe Financial Corp ($SFEF)8.7%22.7%37.0%23.6%9.5%
 
Median (1 company)8.7%22.7%37.0%23.6%9.5%
Portsmouth Square Inc ($PRSI)8.9%23.5%37.9%24.1%10.7%


Top companies by CAPEX/Revenue, %

Top  FY2016 FY2017 FY2018 FY2019 FY2020
Santa Fe Financial Corp ($SFEF)7.4%0.7%0.5%2.3%3.0%
 
Median (1 company)7.4%0.7%0.5%2.3%3.0%
Portsmouth Square Inc ($PRSI)7.2%0.6%0.4%2.3%3.0%


Top companies by ROIC, %

Top  FY2016 FY2017 FY2018 FY2019 FY2020
Santa Fe Financial Corp ($SFEF)3.6%17.7%35.8%21.7%3.4%
 
Median (1 company)3.6%17.7%35.8%21.7%3.4%
Portsmouth Square Inc ($PRSI)5.0%21.9%42.3%25.8%5.4%


Top companies by Net Debt / EBITDA

Top  FY2016 FY2017 FY2018 FY2019 FY2020
Santa Fe Financial Corp ($SFEF)24.9x10.2x5.6x8.2x30.2x
 
Median (1 company)24.9x10.2x5.6x8.2x30.2x
Portsmouth Square Inc ($PRSI)23.8x9.7x5.4x7.8x26.3x


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