v3.26.1
REVENUE
 9 Months Ended
Mar. 31, 2026
Revenue from Contract with Customer [Abstract]  
REVENUE

NOTE 3 – REVENUE

 

Our revenue from real estate is primarily rental income from residential and commercial property leases that is accounted for under ASC 842, Leases, and is recognized on a straight-line basis over the lease term. Rental income from residential leases is generally recognized as earned on a monthly basis, consistent with lease terms.

 

The following table presents Hotel revenues disaggregated by major revenue source for the three and nine months ended March 31, 2026 and 2025:

  

For the three months ended March 31,  2026   2025 
Hotel revenues:          
Hotel rooms  $14,424,000   $10,534,000 
Food and beverage   980,000    728,000 
Garage   764,000    760,000 
Other operating departments   329,000    188,000 
Total Hotel revenue  $16,497,000   $12,210,000 

 

For the nine months ended March 31,  2026   2025 
Hotel revenues:          
Hotel rooms  $35,907,000   $29,045,000 
Food and beverage   2,512,000    2,115,000 
Garage   2,486,000    2,415,000 
Other operating departments   671,000    420,000 
Total Hotel revenue  $41,576,000   $33,995,000 

 

Performance Obligations

 

We identified the following performance obligations for which revenue is recognized when (or as) the performance obligations are satisfied, in an amount that reflects the consideration we expect to be entitled to in exchange for providing the goods or services:

 

  ● Cancelable room reservations or ancillary services are typically satisfied as the good or service is transferred to the Hotel guest, which is generally when the room stay occurs.
     
  ● Non-cancelable room reservations and banquet or conference reservations represent a series of distinct goods or services provided, generally recognized daily over the stay or as banquet/conference services are rendered.

 

 

  ● Other ancillary goods and services are purchased independently of the room reservation at standalone selling prices and are considered separate performance obligations, which are satisfied when the related good or service is provided to the Hotel guest.
     
  ● Components of package reservations for which each component could be sold separately to other Hotel guests are considered separate performance obligations and are satisfied as set forth above.

 

Hotel revenue primarily consists of Hotel room rentals, revenue from accommodations sold in conjunction with other services (e.g., package reservations), food and beverage sales and other ancillary goods and services (e.g., parking). Revenue is recognized when rooms are occupied or goods and services have been delivered or rendered, respectively. Payment terms typically align with when the goods and services are provided. For package reservations, the transaction price is allocated to the performance obligations within the package based on the estimated standalone selling prices of each component.

 

We do not disclose the value of unsatisfied performance obligations for contracts with an expected length of one year or less. Due to the nature of our business, our revenue is not significantly impacted by refunds. Cash payments received in advance of guests staying at our Hotel are refunded if the guest cancels within the specified time period, before any services are rendered. Refunds related to service are generally recognized as an adjustment to the transaction price at the time the Hotel stay occurs or services are rendered.

 

Contract Assets and Liabilities

 

The Company does not have any material contract assets as of March 31, 2026, and June 30, 2025, other than trade and other receivables, net on our condensed consolidated balance sheets. Our receivables are primarily the result of contracts with customers, and are presented net of an allowance for doubtful accounts that reflects our estimate of amounts that will not be collected.

 

Portsmouth records contract liabilities when cash payments are received or due in advance of guests staying at the Hotel, which are presented within accounts payable and other liabilities - Hotel on the Company’s condensed consolidated balance sheets. Contract liabilities had an opening balance of $505,000 at July 1, 2025. Contract liabilities were $623,000 as of March 31, 2026. The increase as of March 31, 2026 was primarily driven by an increase in advance deposits received from customers for services to be performed after March 31, 2026. During the nine months ended March 31, 2026, we recognized $505,000 of revenue that was included in the contract liability balance at July 1, 2025.

 

Contract liabilities were $370,000 as of July 1, 2024 and decreased to $290,000 as of March 31, 2025. During the nine months ended March 31, 2025, we recognized $370,000 of revenue that was included in the contract liability balance at July 1, 2024.

 

Contract Costs

 

We consider sales commissions earned to be incremental costs of obtaining a contract with our customers. As a practical expedient, we expense these costs as incurred as our contracts with customers are less than one year.