Business Overview
Intosol Holdings PLC (INTO) is an award-winning international luxury travel group. The group offers Internet-based accommodation service and luxury travel. The company, VIRTOSOL technology platform, designs luxury trips in a range of international destinations. This technology includes video, travel animations, mapping and photo materials. The company also manages boutique luxury villas and hotels through its SOUL Private Collection. The company is involved in hotel management, technology development, private travel design and real estate management. The company holds across 3,500 hotel and agency contracts worldwide. The group also have across 50 employees spread over three countries. The Company manages and leases the Penthouse on Beach; Santa Maria Beach House and Spa; Retreat on Cliff; and Retreat on Hove in South Africa.

Q1 FY20 Trading Update (as on 17^th June 2019)
Increase in revenues of EUR 1,789,916 delivered, despite its being the low season for luxury travel. An increase of 15 per cent in guest bookings in the SOUL Private Collection properties as compared to Q1 FY2019.

Financial Highlights (FY2019, €)

(Source: Final Results, Company Fillings, LSE)

The company’s reported revenue increased from €5.2 million in FY18 to €7.2 million in FY19. Gross profit stood at €1.4 million, a decrease as compared with the financial year 2018. Operating loss was €1.8 million, a huge decline from the previous year operating profit of €87 thousand in FY18. The net loss for the year 2019 stood at €1.8 million, an increase from the prior year data. Basic and diluted loss per share increased to 0.17 cents as compared with the financial year 2018 loss of 0.02 cents.

Cash and cash equivalents reduced from €160 thousand in FY18 to €148 thousand in FY19. The company’s total assets increased to €5.6 million in FY2019 as compared to €4.4 million in the financial year 2018. The total equity and reserves increased to €726.5 thousand in 2019.

Share Price Performance

Daily Chart as at June-20-19, before the market closed (Source: Thomson Reuters)
 
At the time of writing (as on June 20, 2019, at 2:55 PM GMT), shares of INTO were quoting at GBX 38/share and same against the yesterday's closing price level. The outstanding market capitalisation of the company stood at around £4.63 million.

In the last 52-wks, shares of INTO have registered a high of GBX 110 and a low of GBX 30. At the current trading level, as quoted in the price chart, its shares were trading 64.45% below the 52wk high price level and 26.67% above the 52wk low price level.

However, the 5-day average daily volume traded in the stock was at 1,133.80, which was 57.29% below the 30-day average daily volume of 2,654.63 traded on the London Stock Exchange.
On a year-to-date basis, the stock was down by approximately 55.29% and increased by 8.57% in the past three months.

Key Risks
Interest rate risk, credit risk, liquidity risk, and foreign exchange risk.

Conclusion
The company had shown downtrend in the financial performance in the current financial year. There had been a decrease in bottom-line performance. The company continues to analyse new luxury hotel properties to increase the collection, with an opinion to growing beyond South Africa. The company’s profitability had decreased significantly with the adoption of tight cost control measures and efficiency programme.

In FY19, the company’s gross margin is lower than the corresponding period of the last year data. The return on equity (ROE) was negative in the current period. Based on the headwinds faced by the company, we have given a “WATCH" recommendation at the closing price of GBX 38 (as on 19 June 2019), while we look for any upcoming catalysts.

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