Yes B (per PM), you'll see WHEN I SOLD by my comments & CHART!!

Now, we'll see what's UP NEXT. Will the $70 (6-mo bottom per charts) hold (on the retrace)? I'm going to guess that AS OF THIS WRITING, the retrace will be DEEPER. As people start LOSING PROFITS, they tend towards PANICKING & selling soas NOT to miss out on their gains! The momo trend will be IMV downward in the near-term....

The stock KEPT CLIMBING, & that can only be sustained for so long -- without a SERIOUS MARKET DRIVER (like HUGE sustainable PROFITS). With inflation on the rise, it SHOULD CUT INTO disposable income & SO I predict(ed) -- privately -- that stocks like this would have the KINDS OF HEADWINDS that lead to a retrace. Not ALL sin stocks (tobacco, alcohol, cheaper "luxuries" that HAVE NOT had these kinds of gains!) are worth looking into...

The ONLY thing to watch HERE now is how LOW will this retrace. At some point the risk of buying & supporting has to outweighed by the PROFIT potential. That, in my view, is NOT the case here. This is a stock to SHORT in the near-term BECAUSE of the economics, inflation, disposable income, trend, risk, etc.. I'd GUESS that it breaks DOWN THROUGH $70 sometime in the next 3-6mos before it a bottom can be identified as a GOOD RISK-REWARD set-up.

Been doing this a LONG TIME. From a probability standpoint I think the stock sinks lower... But,.. TIME WILL TELL: ALWAYS DOES!! GLA

CONGRAT$. Great timing finding this GEM at sub-$10s. They say "Timing is EVERYTHING".

There's NOTHING to complain about!

Everything, especially since just before covid ROCKED our world's has been going SWIMMINGLY!!

So happy & LUCKY to have targeted a "sin stock" & found this gem when I did... The hardest part was taking a leap of faith on the extensive DD because, as most of you probably KNOW, fishing with sub-$10 stocks, ESPECIALLY when this broke it's THEN ~8-yr ($6.88 & $7.20) double-bottom in early-2020 took some doing!

But it was THE BEST IN CLASS "sin stock" with the most upside I could find... So I went with the THESIS & instincts. Never ever having EVER been to one of their 'restaurant/entertainment establishments', but so glad I followed my gut!

This has been a MULTIPLE winner-winner -- & there is NOTHING to complain about regarding the way they are operating & running their business -- At least from my pov!

This one gave me a TRIPLE nearly right away --- came off some EXECTING profit-taking & (as you can see with your OWN EYES: https://stockcharts.com/h-sc/ui ) RAN another 8x+ MONEY!!

GLA

I have been to a few of their clubs in Texas and the entertainment was pretty disgusting. However, the bank account continues to grow from this one. Lol

They're kicking ads here.

this is truly a growth stock!

With all the stock price Appreciation that I have observed with ricks over the years for the life of me I can’t understand why some of that $ just doesn’t flow into scores (scrh)to help the competition don’t figure. Will there ever be a time in the sun for the scrh holders??

$RICK | #RCIHospitality Holdings Inc Bullish Channel Trade


Short interest - 15%
. operates as a holding company, which engages in hospitality activities and related businesses. Through its subsidiaries, it offers live adult entertainment and bar operations. It operates through the following segments; Nightclubs, Bombshell and other. The Nightclubs segment operates adult entertainment clubs. Its major brands include Rick's Cabaret, Jaguar's Club, Tootsie's Cabaret, XTC Cabaret and Club Onyx. The Bombshell segment operates restaurants in Texas, Dallas, Austin and Houston. The Other segment includes media which is a business communications company. The company was founded by Robert L. Watters in 1983 and is headquartered in Houston, TX .

Board has been quiet for 2 years—-Why???......Not a Bad day so far....

bought back in late 08 for $4 and sold today for $20 and bought ANH with the proceeds...ANH pays a 10% dividend

We are in the same industry. Definitely seeing an uptick.

I just found Rick's the other day, Will be DD'ing it. Look's promising.

No one here? Wonder why not. Great opportunities.

IN THE NEWS: RICK

IN THE NEWS: RICK

wow up 50% in a month.

After YEARS of doing nothing.

Chris

RiCK bullish 15.66


http://www.rcihospitality.com/
http://rickscabaret.com/

IN THE NEWS: RICK BEATS BY .03

RCI Continues Rebound with 2Q16 EPS at $0.54 GAAP & $0.40 Non-GAAP
PR Newswire RCI Hospitality Holdings, Inc.
May 10, 2016 4:05 PM
????
HOUSTON, May 10, 2016 /PRNewswire/ -- RCI Hospitality Holdings, Inc. (RICK) today announced its performance continued to rebound in the fiscal 2016 second quarter ended March 31, 2016.

View photo
.RCI Hospitality Holdings Corporate Logo (PRNewsFoto/RCI Hospitality Holdings, Inc.)
2Q16 Highlights

GAAP EPS diluted was $0.54, which included a $1.75 million tax credit. Excluding non-recurring items, non-GAAP* EPS diluted was $0.40.
In the year ago quarter, GAAP EPS was a loss of ($0.28), which included a $10.3 million pre-tax expense for a legal settlement. Non-GAAP EPS diluted was $0.44. 2Q15 was a record quarter for sales and non-GAAP earnings.
2Q16 results reflect a continued recovery in performance following a falloff after 2Q15.
2Q16 free cash flow (FCF) totaled $6.4 million, the second largest quarter on record, and $10.3 million for the first half of FY16.
As a result, RCI has revised its FY16 FCF target upward to $16-$19 million from $15-18 million.
Cash Dividend & Share Buy Backs

RCI accelerated its share buyback program in FY16, taking advantage of its strong FCF to return capital to shareholders.
Through April 30, 2016, the company purchased 566,921 common shares to date in FY16 at a cost of $5.4 million, reducing shares outstanding to 9.889 million from 10.348 million a year ago.
RCI yesterday announced a $5.0 million increase in its authorization to repurchase common shares, resulting in a total of $6.2 million available to buy back stock.
RCI also announced yesterday the company's 3Q16 $0.03 dividend will be paid June 27, 2016 to shareholders of record June 10, 2016.
Conference Call

A conference call to discuss these results, outlook and related matters will be held today at 4:30 PM ET
Dial In: 877-407-9210 (toll free) or 201-689-8049 (domestic or international)
Webcast URL: http://www.investorcalendar.com/event/174973
Meet Management Tonight

Eric Langan, President & CEO, invites investors to meet management and tour one of the company's top clubs.

When: Tonight, May 10, 2016, 6:00 PM to 8:00 PM ET
Where: Rick's Cabaret New York, at 50 W. 33rd Street, between Fifth Avenue and Broadway
RSVP: With your contact information to gary.fishman@anreder.com
CEO Comment

"We are pleased 2Q16 revenues, margins, profits and free cash flow performed better than our original expectations," Mr. Langan said.

"This is especially encouraging as we were up against our largest sales quarter ever in the year ago period. Moreover, two clubs were closed in 2Q16 undergoing reformatting and remodeling.

"Our FY16 plan is to continue to grow margins, EPS and FCF on what we expect to be flattish revenues on an annual basis, while adhering to our capital allocation policy.

"Costs as a percentage of revenues are going down. Operating margin has improved two quarters in a row.

"Sales are moving in the right direction. Same store sales were nearly level with the year-ago quarter. 3Q16 should benefit from reopening of the two reformatted clubs, and we anticipate opening the first sports-themed club in Manhattan in 4Q16.

"As a result of our first six months' performance, we have increased our FY16 free cash flow target to $16-$19 million.

"The company remains committed to our capital allocation policy of using FCF to enhance shareholder value through share repurchases and dividends. As part of this policy, we will continue to evaluate the risk adjusted returns on capital expenditures or acquisitions relative to the after tax yield on free cash flow we can obtain by repurchasing our own shares.

"While opportunities may arise to acquire or open new units or pay down debt ahead of schedule, we generally believe the best allocation of our capital is the risk-adjusted, after-tax, FCF yield of buying our own shares as long as our stock stays at this low valuation relative to RCI's cash flow generation."

2Q16 Analysis

Total Revenues

Total revenues of $34.4 million increased $0.9 million or 2.8% from 1Q16, reflecting improvements in almost all major categories.
High-margin service revenues increased $0.6 million or 4.5% from 1Q16 as club customers began to spend more per visit and new marketing strategies started to prove effective. Food sales increased $0.3 million or 6.3% from 1Q16 due to Bombshells' growing business.
Same store sales of $32.9 million declined only 0.9% year over year, representing a significant increase from our performance in 1Q16 and 4Q15.
Operating Income & Margin

Income from operations was $7.6 million, or 22.0% of revenues, up from 17.1% in 1Q16.
Excluding non-recurring items, non-GAAP operating income was $7.9 million, or 23.1% of revenues, up from 19.7% in 1Q16.
The improvement in operating income as compared to 1Q16 reflects the increase in sales, in particular service revenues, as well as reduced costs as a percentage of revenues.
2Q16 Segment Analysis

Nightclubs

Sales of $29.1 million compared to $29.9 in the year ago quarter, with 36 units in operation compared to 40.
Operating income was $9.7 million, or 33.5% of revenues, compared to a loss of ($0.8) million, or (2.7%), in 2Q15.
Non-GAAP operating income was $9.8 million, or 33.7% of revenues, compared to $9.5 million, or 31.7%, in 2Q15.
Bombshells

Sales of $4.6 million compared to $4.4 million in the year ago quarter, with five units in operation in both periods.
Operating income was $0.64 million compared to $0.46 million in 2Q15.
Operating margin was 13.9% compared to 10.3% in 2Q15.
2Q16 Other Metrics

Occupancy Costs: Occupancy costs, which the company measures as a combination of rent plus interest expense, declined to 8.2% of revenues compared to 8.5% in 2Q15. The decline reflects significantly lower rent due to the acquisitions of club real estate in New York City in early 2Q16 and of Miami Gardens in 4Q15.
Effective Tax Rate: $1.75 million was deducted from income tax expense, due to the benefit of certain FICA credits not previously claimed. Excluding this deduction, RCI would have paid an effective tax rate of 36.6%.
Adjusted EBITDA & Free Cash Flow: RCI's cash generating power, as reflected by adjusted EBITDA, amounted to $9.7 million compared to $8.2 million in 1Q16. As a result, RCI generated FCF of $6.4 million compared to $3.9 million in 1Q16.
Balance Sheet (March 31, 2016 compared to December 31, 2015): Total stockholders' equity increased to $131.9 million from $128.2 million due to the increase in retained earnings partially offset by share buy backs.
*Non-GAAP Financial Measures

In addition to our financial information presented in accordance with GAAP, management uses certain "non-GAAP financial measures" within the meaning of the SEC Regulation G, to clarify and enhance understanding of past performance and prospects for the future. Generally, a non-GAAP financial measure is a numerical measure of a company's operating performance, financial position or cash flows that excludes or includes amounts that are included in or excluded from the most directly comparable measure calculated and presented in accordance with GAAP. We monitor non-GAAP financial measures because it describes the operating performance of the company and helps management and investors gauge our ability to generate cash flow, excluding some non-recurring charges that are included in the most directly comparable measures calculated and presented in accordance with GAAP. Relative to each of the non-GAAP financial measures, we further set forth our rationale as follows:

Non-GAAP Operating Income and Non-GAAP Operating Margin. We exclude from non-GAAP operating income and non-GAAP operating margin amortization of intangibles, gain on settlement of patron tax case, pre-opening costs, gains and losses from asset sales, gain on settlement of patron tax issue, impairment of assets, pre-opening costs, stock-based compensation charges, litigation and other one-time legal settlements and acquisition costs. We believe that excluding these items assists investors in evaluating period-over-period changes in our operating income and operating margin without the impact of items that are not a result of our day-to-day business and operations. While we were in litigation in the patron tax case, we also included patron taxes as an exclusion, but after settlement of the case, we no longer exclude patron taxes from operating income.
Non-GAAP Net Income and Non-GAAP Net Income per Basic Share and per Diluted Share. We exclude from non-GAAP net income and non-GAAP net income per diluted share and per basic share amortization of intangibles, gain on settlement of patron tax case, pre-opening costs, income tax expense, impairment charges, gains and losses from asset sales, stock-based compensation, litigation and other one-time legal settlements, gain on contractual debt reduction and acquisition costs, and include the Non-GAAP provision for income taxes, calculated as the tax-effect at 35% effective tax rate of the pre-tax non-GAAP income before taxes less stock-based compensation, because we believe that excluding such measures helps management and investors better understand our operating activities. While we were in litigation in the patron tax case, we also included patron taxes as an exclusion, but after settlement of the case, we no longer exclude patron taxes from net income.
Adjusted EBITDA. We exclude from Adjusted EBITDA depreciation expense, amortization of intangibles, income tax, interest expense, interest income, gains and losses from asset sales, pre-opening costs, acquisition costs, litigation and other one-time legal settlements, gain on settlement of patron tax case, gain on contractual debt reduction and impairment charges because we believe that adjusting for such items helps management and investors better understand operating activities. Adjusted EBITDA provides a core operational performance measurement that compares results without the need to adjust for Federal, state and local taxes which have considerable variation between domestic jurisdictions. Also, we exclude interest cost in our calculation of Adjusted EBITDA. The results are, therefore, without consideration of financing alternatives of capital employed. We use Adjusted EBITDA as one guideline to assess our unleveraged performance return on our investments. Adjusted EBITDA is also the target benchmark for our acquisitions of nightclubs.
Other Notes

Starting with 1Q16, total revenues (including prior comparable periods) are being reported net of sales taxes and other revenue related taxes, RCI having chosen to early adopt new revenue accounting standards.
Free cash flow is defined as cash flows from operating activities less maintenance capex.
Unit counts are at period end.
About RCI Hospitality Holdings, Inc. (RICK)

With 43 units, RCI Hospitality Holdings, Inc., through its subsidiaries, is the country's leading company in gentlemen clubs and sports bars/restaurants. Clubs in New York City, Miami, Philadelphia, Charlotte, Dallas/Ft. Worth, Houston, Minneapolis, Indianapolis and other cities operate under brand names, such as "Rick's Cabaret," "XTC," "Club Onyx," "Vivid Cabaret," "Jaguars" and "Tootsie's Cabaret." Sports bars/restaurants operate under the brand name "Bombshells." Please visit http://www.rcihospitality.com/

Forward-Looking Statements

This press release may contain forward-looking statements that involve a number of risks and uncertainties that could cause the company's actual results to differ materially from those indicated in this press release, including the risks and uncertainties associated with operating and managing an adult business, the business climates in cities where it operates, the success or lack thereof in launching and building the company's businesses, risks and uncertainties related to cybersecurity, conditions relevant to real estate transactions, and numerous other factors such as laws governing the operation of adult entertainment businesses, competition and dependence on key personnel. The company has no obligation to update or revise the forward-looking statements to reflect the occurrence of future events or circumstances.



RCI HOSPITALITY HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME


















FOR THE THREE MONTHS


FOR THE SIX MONTHS

ENDED MARCH 31,
ENDED MARCH 31,
(in thousands, except per share data)

2016


2015


2016


2015


(UNAUDITED)


(UNAUDITED)
Revenues:















Sales of alcoholic beverages

$
14,581


$
14,311


$
29,178


$
28,316
Sales of food and merchandise


4,609



4,837



8,943



9,670
Service revenues


13,205



13,847



25,846



27,376
Other


2,001



1,994



3,904



3,832
Total revenues


34,396



34,989



67,871



69,194
















Operating expenses:















Cost of goods sold


5,227



5,381



10,411



10,492
Salaries and wages


7,917



8,115



16,052



16,147
Stock compensation


120



120



240



240
Other general and administrative:















Taxes and permits


3,274



3,288



6,501



6,399
Charge card fees


557



544



1,170



1,091
Rent


859



1,184



1,807



2,325
Legal and professional


982



1,064



2,087



2,023
Advertising and marketing


1,225



1,312



2,530



2,679
Insurance


907



801



1,781



1,621
Utilities


694



708



1,404



1,442
Depreciation and amortization


1,826



1,886



3,643



3,531
(Gain) loss on sale of property and marketable securities


(127)



(18)



(127)



(18)
Impairment of assets


-



-



-



1,358
Settlement of lawsuits and other one-time costs


62



10,303



602



10,550
Other


3,323



2,917



6,503



5,790
Total operating expenses


26,846



37,605



54,604



65,670
Operating income (loss)


7,550



(2,616)



13,267



3,524
















Other income (expense):















Interest income


1



26



3



39
Interest expense


(1,965)



(1,783)



(3,878)



(3,402)
Gain from acquisition of controlling interest in subsidiary


-



-



-



577
Income (loss) before income taxes


5,586



(4,373)



9,392



738
Income taxes (benefit)


293



(1,265)



1,660



581
Net income (loss)


5,293



(3,108)



7,732



157
Less: net loss attributable to noncontrolling interests


212



267



325



362
Net income (loss) attributable to RCI Hospitality Holdings, Inc.

$
5,505


$
(2,841)


$
8,057


$
519
















Basic earnings (loss) per share attributable to RCIHH shareholders:















Net income

$
0.55


$
(0.28)


$
0.79


$
0.05
Diluted earnings (loss) per share attributable to RCIHH shareholders:















Net income

$
0.54


$
(0.28)


$
0.78


$
0.05
















Weighted average number of common shares outstanding:















Basic


10,013



10,275



10,154



10,269
Diluted


10,215



10,275



10,356



10,273
















Dividends per share

$
0.03


$
-


$
0.03


$
-


RCI HOSPITALITY HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES













FOR THE THREE MONTHS

FOR THE SIX MONTHS

FOR THE THREE MONTHS


ENDED MARCH 31,

ENDED MARCH 31,

ENDED DECEMBER 31,
($ in thousands, except per share data)

2016

2015

2016

2015

2015











Reconciliation of GAAP net income to Adjusted EBITDA










GAAP net income (loss)

$5,505

($2,841)

$8,057

$519

$2,552
Income tax expense

293

(1,265)

1,660

581

1,367
Interest expense and income and gain on Drink Robust investment

1,964

1,757

3,875

2,786

1,911
Litigation and other one-time legal settlements

62

10,303

602

10,550

540
Pre-opening costs

-

268

-

328

-
Acquisition costs

-

95

-

178

-
Impairment of assets

-

-

-

1,358

-
Depreciation and amortization

1,826

1,886

3,643

3,531

1,817
Adjusted EBITDA

$9,650

$10,203

$17,837

$19,831

$8,187











Reconciliation of GAAP net income (loss) to non-GAAP net income










GAAP net income (loss)

$5,505

($2,841)

$8,057

$519

$2,552
Amortization of intangibles

197

336

399

579

202
Gain on Drink Robust investment

-

-

-

(577)

-
Stock-based compensation

120

120

240

240

120
Litigation and other one-time settlements

62

10,303

602

10,550

540
Pre-opening costs

-

268

-

328

-
Income tax expense

293

(1,265)

1,660

581

1,367
Acquisition costs

-

95

-

178

-
Impairment of assets

-

-

-

1,358

-
Non-GAAP provision for income taxes

(2,120)

(2,414)

(3,751)

(4,731)

(1,673)
Non-GAAP net income

$4,057

$4,602

$7,207

$9,025

$3,108











Reconciliation of GAAP diluted net income per share to non-GAAP diluted net income per share










Fully diluted shares

10,215

10,275

10,356

10,273

10,635
GAAP net income (loss)

$0.54

($0.28)

$0.78

$0.05

$0.25
Amortization of intangibles

0.02

0.03

0.04

0.06

0.02
Gain on Drink Robust investment

-

-

-

(0.06)

-
Stock-based compensation

0.01

0.01

0.02

0.02

0.01
Litigation and other one-time settlements

0.01

1.00

0.06

1.03

0.05
Pre-opening costs

-

0.03

-

0.03

-
Income tax expense

0.03

(0.12)

0.16

0.06

0.13
Acquisition costs

-

0.01

-

0.02

-
Impairment of assets

-

-

-

0.13

-
Non-GAAP provision for income taxes

(0.21)

(0.23)

(0.36)

(0.46)

(0.16)
Non-GAAP diluted net income per share

$0.40

$0.44

$0.70

$0.88

$0.30











Reconciliation of GAAP operating income to non-GAAP operating income










GAAP operating income (loss)

$7,550

($2,616)

$13,267

$3,524

$5,717
Amortization of intangibles

197

336

399

579

202
Stock-based compensation

120

120

240

240

120
Impairment of assets

-

-

-

1,358

-
Litigation and other one-time settlements

62

10,303

602

10,550

540
Pre-opening costs

-

268

-

328

-
Acquisition costs

-

95

-

178

-
Non-GAAP operating income

$7,929

$8,506

$14,508

$16,757

$6,579











Reconciliation of GAAP operating margin to non-GAAP operating margin










GAAP operating income

22.0%

-7.5%

19.5%

5.1%

17.1%
Amortization of intangibles

0.6%

1.0%

0.6%

0.8%

0.6%
Stock-based compensation

0.3%

0.3%

0.4%

0.3%

0.4%
Impairment of assets

0.0%

0.0%

0.0%

2.0%

0.0%
Litigation and other one-time settlements

0.2%

29.4%

0.9%

15.2%

1.6%
Pre-opening costs

0.0%

0.8%

0.0%

0.5%

0.0%
Acquisition costs

0.0%

0.3%

0.0%

0.3%

0.0%
Non-GAAP operating margin

23.1%

24.3%

21.4%

24.2%

19.7%


RCI HOSPITALITY HOLDINGS, INC.
SEGMENT INFORMATION


















FOR THE THREE MONTHS


FOR THE SIX MONTHS


ENDED MARCH 31,


ENDED MARCH 31,
(in thousands)

2016


2015


2016


2015
















Business segment sales:















Nightclubs

$
29,062


$
29,916


$
57,514


$
59,030
Bombshells


4,629



4,448



9,008



8,982
Other


705



625



1,349



1,182


$
34,396


$
34,989


$
67,871


$
69,194
















Business segment operating income (loss):















Nightclubs

$
9,734


$
(818)


$
18,195


$
6,836
Bombshells


643



457



1,245



882
Other


(799)



(724)



(1,504)



(1,189)
General corporate


(2,028)



(1,531)



(4,669)



(3,005)


$
7,550


$
(2,616)


$
13,267


$
3,524
















Reconciliation of Nightclubs GAAP operating income to non-GAAP operating income















Nightclubs operating income

$
9,734


$
(818)


$
18,195


$
6,836
Impairment of assets


-



-



-



1,358
Settlement of lawsuits and other one-time costs


62



10,303



602



10,550
Nightclubs non-GAAP operating income

$
9,796


$
9,485


$
18,797


$
18,744
















Nightclubs non-GAAP operating margin


33.7%



31.7%



32.7%



31.8%

Associated Press

More like thisRemove




America’s Richest Family Gave Away $407 Million in Walmart SharesIt's a big deal.


Fortune
WMT $62.92 2.38%

More like thisRemove




4 Safe Dividend Stocks to Buy as 2016 Starts With Market RoutOne great move is to look for safe stocks that pay solid dividends. That often means companies where the demand rarely drops, despite economic and market conditions.


24/7 Wall St.
MER-PM $25.41 -0.24%

More like thisRemove

Load more stories

RCI Hospitality Announces 4Q15 & FY15 Club & Restaurant Sales

- FY15 Sales of $142.1 Million - Up 11.6% vs. FY14
- 4Q15 Sales of $34.0 Million - Up 3.9% vs. 4Q14


.

PR Newswire
RCI Hospitality Holdings, Inc.
October 8, 2015 9:00 AM


HOUSTON, Oct. 8, 2015 /PRNewswire/ -- RCI Hospitality Holdings, Inc. (RICK) today announced total sales at adult clubs and bars/restaurants for the fiscal fourth quarter and year ended September 30, 2015. RCI expects to announce 4Q15 and FY15 results on December 14, 2015.




..
View photo
.RCI HOSPITALITY HOLDINGS INC
FY15 vs. FY14
•Total club and restaurant sales reached $142.1 million compared to $127.4 million.
•Same store sales were $110.6 million compared to $111.3 million.
•Nightclubs segment sales totaled $123.0 million compared to $121.2 million.
•Bombshells segment sales totaled $19.1 million compared to $6.2 million.

4Q15 vs. 4Q14
•Total club and restaurant sales reached $34.0 million compared to $32.7 million.
•Same store sales were $29.9 million compared to $31.6 million.
•Nightclubs segment sales totaled $29.4 million compared to $30.1 million.
•Bombshells segment sales totaled $4.6 million compared to $2.5 million.

In 4Q15, there were 45 units (40 clubs and 5 Bombshells) versus 46 in 4Q14 (43 clubs and 3 Bombshells). During 4Q15, Union Square nightclub in Fort Worth was closed.

CEO Comment
Eric Langan, President and CEO, commented, "We're pleased to see a 3.9% year over year increase in quarterly sales and an 11.6% increase in annual sales.

"This continues to demonstrate the soundness of our bar/restaurant strategy, which saw Bombshells segment sales up 84% in 4Q15 and up more than 200% in FY15, and the success of our January acquisition of Down in Texas Saloon in Austin, TX, and the May acquisition of The Seville Club of Minneapolis.

"For FY15, same store sales were nearly level, but down 5.6% for 4Q15. During the quarter, selected units in Texas were soft, but larger clubs around the country did well, with Tootsie's Cabaret up 5.5%, Rick's Cabaret New York up 5.2%, Vivid Cabaret New York up 7.6%, and Jaguars Phoenix up 12.3%.

"Over the course of the year, while customer traffic was good, spending per customer eased, perhaps reflecting general economic uncertainty. We also saw more traditional patterns in our business, where we experience a stronger first half and a softer second half. In response, we're making major adjustments in promotions and other factors."

About RCI Hospitality Holdings, Inc. (RICK)
With 45 units, RCI Hospitality Holdings, Inc., through its subsidiaries, is the country's leading company in adult gentlemen clubs and sports bars/restaurants. Adult clubs in New York City, Miami, Philadelphia, Charlotte, Dallas/Ft. Worth, Houston, Minneapolis, Indianapolis and other cities operate under brand names, such as "Rick's Cabaret," "XTC," "Club Onyx," "Vivid Cabaret," "Jaguars" and "Tootsie's Cabaret." Sports bars/restaurants operate under the brand name "Bombshells." Please visit http://www.rcihospitality.com/

Forward-Looking Statements
This press release may contain forward-looking statements that involve a number of risks and uncertainties that could cause the company's actual results to differ materially from those indicated in this press release, including the risks and uncertainties associated with operating and managing an adult business, the business climates in cities where it operates, the success or lack thereof in launching and building the company's businesses, risks and uncertainties related to the operational and financial results of our Web sites, conditions relevant to real estate transactions, and numerous other factors such as laws governing the operation of adult entertainment businesses, competition and dependence on key personnel. The company has no obligation to update or revise the forward-looking statements to reflect the occurrence of future events or circumstances.

All references to, the "company," "we," "our," and similar terms include RCI Hospitality Holdings, Inc. and its subsidiaries, unless the context indicates otherwise.

RCI Hospitality Holdings, Inc. Reports Fiscal 3Q15 Results

GAAP EPS of $0.78 Up 11x YoY on Gain from Tax Settlement


RCI Hospitality Holdings, Inc.
21 hours ago


HOUSTON, Aug. 10, 2015 /PRNewswire/ -- RCI Hospitality Holdings, Inc. (RICK) today announced results for the fiscal 2015 third quarter ended June 30, 2015.




..
View photo
.RCI HOSPITALITY HOLDINGS INC
3Q15 Highlights
•GAAP EPS diluted of $0.78 includes the previously announced gain from the settlement of the Patron Tax issue with the State of Texas. This compares to $0.07 in 3Q14.
•Non-GAAP EPS* diluted of $0.32 increased 6.7% from $0.30 in 3Q14. Non-GAAP EPS excludes the above mentioned tax settlement as well as other items from both periods for comparability.
•Total revenues of $35.8 million grew 7.3% year over year.
•$2.3 million used to buy back shares in the open market in the first nine months of Fiscal 2015.
•Company on track for a solid FY15 and another year of growth in FY16.

Conference Call

A conference call to discuss these results, outlook and related matters will be held today, August 10, 2015, at 4:30 PM ET:
•Live Participant Dial In (Toll Free): 877-407-9210
•Live Participant Dial In (International): 201-689-8049
•Webcast URL: http://www.investorcalendar.com/event/174217

Meet Management

Eric Langan, President and CEO, invites investors for a "Due Diligence Ball" to meet, talk and tour one of RCI's top revenue generating clubs.
•When: Monday, August 10, 2015, 6:00 PM to 8:00 PM ET
•Where: Vivid Cabaret New York, 61 W 37th St, NY, NY 10018, bet. 5th and 6th avenues
•RSVP: By 5:00 PM ET, August 10, 2015, with your contact information, to gary.fishman@anreder.com

CEO Comment

"We're pleased to have generated a 6.7% year over year increase in non-GAAP EPS on a 7.3% year over year in total revenues in 3Q15 despite particularly bad weather in Texas that affected sales there," said Mr. Langan.

"This underscores the soundness of our bar/restaurant strategy, reflecting Bombshells sales up more than threefold year over year; the success of new clubs and our recent acquisitions; and the elimination of some underperforming clubs last year.

"We are particularly pleased to have settled the Texas Patron Tax issue. This resulted in a pre-tax gain of $8.2 million, increasing GAAP EPS to $0.78. This gain will cover close to 80% of 2Q15's New York federal wage and hour class action settlement, which is being implemented as planned.

"Also during 3Q15, we continued to repurchase stock in the open market, reflecting confidence in our favorable outlook, combined with the market's undervaluation of our shares.

"We are on track for a solid Fiscal 2015. Year to date, total revenues are up 14.7%, adjusted EBITDA is up 16.9%, and GAAP EPS and non-GAAP EPS are both up 23.2%. With better weather, same store sales have begun to rebound in 4Q15. Recently, we acquired the retail plaza in Florida where Tootsie's Cabaret, our largest adult club subsidiary and the plaza's largest tenant, is located. We expect this transaction to also be accretive.

"We look forward to Fiscal 2016 as another year of continued growth. With all major outstanding issues behind us, we'll have the ability to apply even more cash generated toward the repurchase of shares."

3Q15 Analysis (all comparisons to 3Q14 unless otherwise noted)

Total Revenues
•Total revenues of $35.8 million compared to $33.3 million, up 7.3%.
•46 units in operation versus 43, up 7.0%.
•Same store sales declined 5.3% due to unusually severe rain and flooding in Texas that affected our nightclub segment, in particular, as previously announced.
•Units opened less than a year added $5.2 million from new adult clubs – Rick's Cabaret in Odessa, TX, the January acquisition of Down in Texas Saloon in Austin, TX, and the May acquisition of The Seville Club of Minneapolis, plus new Bombshells in Austin, Spring, and Houston, TX.

Operating Margin & Costs (as % of revenues)
•GAAP operating margin was 39.6% compared to 8.7%. 3Q15 benefitted from the $8.2 million gain from the settlement of the Texas Patron Tax. 3Q14 was adversely affected by $3.2 million from the settlement of lawsuits and other one-time costs.
•As reported, in May RCI reached a settlement with the State of Texas over payment of a Patron Tax on adult club customers. RCI agreed to pay $10.0 million in taxes owed in 84 equal monthly installments without interest and to remit the tax on a monthly basis going forward. Because RCI had accrued more than the $10 million owed, the company recorded an $8.2 million pre-tax gain in 3Q15.
•Non-GAAP operating margin, which excludes the gain and certain other non-operating items from both periods for more meaningful analysis, was 18.3% compared to 19.6%. 3Q14 primarily reflects growth of the Bombshells segment, whose margins, while growing, are less than that of the nightclub segment.

Adjusted EBITDA
•RCI's cash generating power for the quarter, as reflected by adjusted EBITDA, amounted to $8.2 million, up 6.1% from $7.7 million in the year ago quarter.

Business Segments (all comparisons to 3Q14 unless otherwise noted)

Nightclubs
•Includes 41 units, the same as in the year ago quarter.
•Sales of $30.6 million compared to $31.5 million, a 2.9% decline.
•Operating income of $17.3 million compared to $8.5 million.
•Adjusted operating income, which excludes the previously mentioned gain and certain other non-operating items from both periods for more meaningful analysis, was $9.1 million (29.8% of sales) compared to $11.8 million (37.3% of sales).
•In May, RCI subsidiaries acquired The Seville Club, a popular gentlemen's club in Minneapolis, for total consideration of $8.5 million.
•In August, an RCI subsidiary acquired the Miami Gardens Square retail plaza in Florida, where Tootsie's Cabaret is located. Total consideration of $15.3 million consisted of $3.975 million in cash and a 5.45%, $11.325 million bank loan.

Bombshells
•Includes five Bombshells, all in Texas, compared to two in the year ago quarter.
•Sales totaled $4.8 million, up from $1.6 million.
•Operating income improved to a profit of $369,000 compared to a loss of $170,000, a $539,000 turnaround.
•Operating margin expanded to 7.7% of revenues from (10.7%) and should increase as revenues continue to build and training costs subside.

Balance Sheet (June 30, 2015 compared to March 31, 2015)
•Assets increased 1.7% to $265.0 million, primarily due to the acquisition of The Seville Club and related real estate.
•Current liabilities declined 37.6% to $28.8 million and long-term debt increased 15.9% to $72.9 million, primarily due to the Texas Patron Tax settlement.
•Total permanent stockholders' equity increased 6.7% to $129.0 million, primarily reflecting the after-tax benefit of the gain from the Patron Tax Settlement and core profits.

Stock Buy Backs
•The Board of Directors increased its stock repurchase authorization to $10.0 million in May 2014.
•During 3Q15, RCI purchased 32,853 shares in the open market for an aggregate cost of $370,799, leaving $6.6 million of remaining authorization.
•For the nine months ended June 30, 2015, RCI purchased 225,280 shares at a cost of $2.3 million.

*Non-GAAP Financial Measures

In addition to our financial information presented in accordance with GAAP, management uses certain "non-GAAP financial measures" within the meaning of the SEC Regulation G, to clarify and enhance understanding of past performance and prospects for the future. Generally, a non-GAAP financial measure is a numerical measure of a company's operating performance, financial position or cash flows that excludes or includes amounts that are included in or excluded from the most directly comparable measure calculated and presented in accordance with GAAP. We monitor non-GAAP financial measures because it describes the operating performance of the company and helps management and investors gauge our ability to generate cash flow, excluding some recurring charges that are included in the most directly comparable measures calculated and presented in accordance with GAAP. Relative to each of the non-GAAP financial measures, we further set forth our rationale as follows:
•Non-GAAP Operating Income and Non-GAAP Operating Margin. We exclude from non-GAAP operating income and non-GAAP operating margin amortization of intangibles, gain on settlement of patron tax case, pre-opening costs, gains and losses from asset sales, stock-based compensation charges, litigation and other one-time legal settlements and acquisition costs. We believe that excluding these items assists investors in evaluating period-over-period changes in our operating income and operating margin without the impact of items that are not a result of our day-to-day business and operations. While we were in litigation in the patron tax case, we also included patron taxes as an exclusion, but after settlement of the case, we no longer exclude patron taxes from operating income.
•Non-GAAP Net Income and Non-GAAP Net Income per Basic Share and per Diluted Share. We exclude from non-GAAP net income and non-GAAP net income per diluted share and per basic share amortization of intangibles, gain on settlement of patron tax case, pre-opening costs, income tax expense, impairment charges, gains and losses from asset sales, stock-based compensation, litigation and other one-time legal settlements and acquisition costs, and include the Non-GAAP provision for income taxes, calculated as the tax-effect at 35% effective tax rate of the pre-tax non-GAAP income before taxes less stock-based compensation, because we believe that excluding such measures helps management and investors better understand our operating activities. While we were in litigation in the patron tax case, we also included patron taxes as an exclusion, but after settlement of the case, we no longer exclude patron taxes from net income.
•Adjusted EBITDA. We exclude from Adjusted EBITDA depreciation expense, amortization of intangibles, income tax, interest expense, interest income, gains and losses from asset sales, acquisition costs, litigation and other one-time legal settlements, gain on settlement of patron tax case and impairment charges because we believe that adjusting for such items helps management and investors better understand operating activities. Adjusted EBITDA provides a core operational performance measurement that compares results without the need to adjust for Federal, state and local taxes which have considerable variation between domestic jurisdictions. Also, we exclude interest cost in our calculation of Adjusted EBITDA. The results are, therefore, without consideration of financing alternatives of capital employed. We use Adjusted EBITDA as one guideline to assess our unleveraged performance return on our investments. Adjusted EBITDA is also the target benchmark for our acquisitions of nightclubs.

Full Financial Tables

RCI's Form 10Q for the fiscal third quarter ended June 30, 2015 with full financial tables can be found on the company's corporate site at http://www.rcihospitality.com.

About RCI Hospitality Holdings, Inc. (RICK)

With 46 units, RCI Hospitality Holdings, Inc., through its subsidiaries, is the country's leading company in adult gentlemen clubs and sports bars/restaurants. Adult clubs in New York City, Miami, Philadelphia, Charlotte, Dallas/Ft. Worth, Houston, Minneapolis, Indianapolis and other cities operate under brand names, such as "Rick's Cabaret," "XTC," "Club Onyx," "Vivid Cabaret," "Jaguars" and "Tootsie's Cabaret." Sports bars/restaurants operate under the brand name "Bombshells." Please visit http://www.rcihospitality.com/

RCI Hospitality in 2015 is celebrating the 20th anniversary of its IPO – two decades of innovation in the adult club segment of the hospitality industry.

Forward-Looking Statements

This press release may contain forward-looking statements that involve a number of risks and uncertainties that could cause the company's actual results to differ materially from those indicated in this press release, including the risks and uncertainties associated with operating and managing an adult business, the business climates in cities where it operates, the success or lack thereof in launching and building the company's businesses, risks and uncertainties related to the operational and financial results of its Web sites, conditions relevant to real estate transactions, and numerous other factors such as laws governing the operation of adult entertainment businesses, competition and dependence on key personnel. The company has no obligation to update or revise the forward-looking statements to reflect the occurrence of future events or circumstances.



RCI HOSPITALITY HOLDINGS, INC. AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF INCOME





















FOR THE THREE MONTHS



FOR THE NINE MONTHS


ENDED JUNE 30,

ENDED JUNE 30,




2015



2014



2015



2014


(in thousands, except per share data)


(UNAUDITED)



(UNAUDITED)















Revenues:

















Sales of alcoholic beverages


$

15,148



$

13,626



$

45,963



$

38,300


Sales of food and merchandise



5,049




4,076




15,515




11,478


Service revenues



13,870




14,035




42,623




41,112


Other



1,694




1,606




5,557




4,746


Total revenues



35,761




33,343




109,658




95,636



















Operating expenses:

















Cost of goods sold



5,033




4,295




15,525




12,083


Salaries and wages



8,176




7,219




24,323




20,650


Stock compensation



120




2




360




156


Other general and administrative:

















Taxes and permits



5,444




5,150




16,546




14,707


Charge card fees



562




479




1,653




1,356


Rent



1,189




1,315




3,514




3,699


Legal and professional



939




1,206




2,962




2,420


Advertising and marketing



1,506




1,420




4,185




4,111


Insurance



866




1,014




2,487




2,785


Utilities



727




650




2,169




1,891


Depreciation and amortization



1,923




1,532




5,454




4,438


Loss on sale of property



178




334




160




248


Impairment of assets



-




-




1,358




-


Settlement of lawsuits and other one-time costs



10




3,233




10,560




3,503


Gain on settlement of patron tax



(8,167)




-




(8,167)




-


Other



3,103




2,602




8,893




7,624


Total operating expenses



21,609




30,451




91,982




79,671


Operating income



14,152




2,892




17,676




15,965


Other income (expense):

















Interest income



-




-




39




112


Interest expense



(1,630)




(2,060)




(5,032)




(5,996)


Gain from original investment in Drink Robust



-




-




577




-


Income before income taxes



12,522




832




13,260




10,081


Income taxes



4,442




203




5,023




3,448


Net income



8,080




629




8,237




6,633


Less: net loss attributable to noncontrolling interests



187




62




549




183


Net income attributable to RCI Hospitality Holdings, Inc.


$

8,267



$

691



$

8,786



$

6,816



















Basic earnings per share attributable to RCIHH's shareholders:
















Net income


$

0.81



$

0.07



$

0.86



$

0.70


Diluted earnings per share attributable to RCIHH's shareholders:
















Net income


$

0.78



$

0.07



$

0.85



$

0.69



















Weighted average number of common shares outstanding:

















Basic



10,245




9,883




10,262




9,695


Diluted



10,707




9,968




10,724




9,922








RCI HOSPITALITY HOLDINGS, INC. AND SUBSIDIARIES


NON-GAAP FINANCIAL MEASURES












For the Three Months


For the Nine Months



Ended June 30,


Ended June 30,









(in thousands, except per share data)

2015


2014


2015


2014











Reconciliation of GAAP net income to Adjusted EBITDA









GAAP net income attributable to RCIHH

$8,267


$691


$8,786


$6,816


Income tax expense

4,442


203


5,023


3,448


Interest expense and income

1,630


2,060


4,993


5,884


Litigation and other one-time legal settlements

10


3,233


10,560


3,503


Gain on settlement of Patron tax case

(8,167)


-


(8,167)


-


Impairment of assets

-


-


1,358


-


Acquisition costs

105


22


283


111


Depreciation and amortization

1,923


1,532


5,454


4,438


Adjusted EBITDA

$8,210


$7,741


$28,290


$24,200











Reconciliation of GAAP net income to non-GAAP net income









GAAP net income attributable to RCIHH

$8,267


$691


$8,786


$6,816


Amortization of intangibles

312


82


892


254


Stock-based compensation

120


2


360


156


Litigation and other one-time settlements

10


3,233


10,560


3,503


Gain on settlement of Patron tax case

(8,167)


-


(8,167)


-


Pre-opening costs

-


306


328


743


Income tax expense

4,442


203


5,023


3,448


Impairment of assets

-


-


1,358


-


Acquisition costs

105


22


283


111


Non-GAAP provision for income taxes

(1,739)


(1,588)


(6,672)


(5,206)


Non-GAAP net income

$3,350


$2,951


$12,751


$9,825











Reconciliation of GAAP diluted net income per share to non-GAAP diluted net income per share









Fully diluted shares

10,707


9,968


10,724


9,922


GAAP net income attributable to RCIHH

$0.78


$0.07


$0.85


$0.69


Amortization of intangibles

0.03


0.01


0.08


0.03


Stock-based compensation

0.01


0.00


0.03


0.02


Litigation and other one-time settlements

0.00


0.32


0.99


0.35


Gain on settlement of Patron tax case

(0.76)


-


(0.76)


-


Pre-opening costs

-


0.03


0.03


0.07


Impairment of assets

-


-


0.13


-


Income tax expense

0.41


0.02


0.47


0.35


Acquisition costs

0.01


0.00


0.03


0.01


Non-GAAP provision for income taxes

(0.16)


(0.16)


(0.62)


(0.52)


Non-GAAP diluted net income per share

$0.32


$0.30


$1.22


$0.99








RCI HOSPITALITY HOLDINGS, INC. AND SUBSIDIARIES


NON-GAAP FINANCIAL MEASURES












For the Three Months


For the Nine Months



Ended June 30,


Ended June 30,









(in thousands, except per share data)

2015


2014


2015


2014











Reconciliation of GAAP operating income to non-GAAP operating income









GAAP operating income

$14,152


$2,892


$17,676


$15,965


Amortization of intangibles

312


82


892


254


Stock-based compensation

120


2


360


156


Litigation and other one-time settlements

10


3,233


10,560


3,503


Gain on settlement of Patron tax case

(8,167)


-


(8,167)


-


Impairment of assets

-


-


1,358


-


Pre-opening costs

-


306


328


743


Acquisition costs

105


22


283


111


Non-GAAP operating income

$6,532


$6,537


$23,290


$20,732











Reconciliation of GAAP operating margin to non-GAAP operating margin









GAAP operating income

39.6%


8.7%


16.1%


16.7%


Amortization of intangibles

0.9%


0.2%


0.8%


0.3%


Stock-based compensation

0.3%


0.0%


0.3%


0.2%


Litigation and other one-time settlements

0.0%


9.7%


9.6%


3.7%


Gain on settlement of Patron tax case

-22.8%


0.0%


-7.4%


0.0%


Impairment of assets

0.0%


0.0%


1.2%


0.0%


Pre-opening costs

0.0%


0.9%


0.3%


0.8%


Acquisition costs

0.3%


0.1%


0.3%


0.1%


Non-GAAP operating margin

18.3%


19.6%


21.2%


21.7%








RCI HOSPITALITY HOLDINGS, INC. AND SUBSIDIARIES


SEGMENT INFORMATION

















For the Three Months



For the Nine Months



Ended June 30,



Ended June 30,


(in thousands)

2015


2014



2015


2014












Business segment sales:










Nightclubs

$

30,568


$

31,486



$

93,564


$

91,037


Bombshells


4,789



1,585




14,510



3,668


Other


404



272




1,584



931



$

35,761


$

33,343



$

109,658


$

95,636
















Business segment operating income:












Nightclubs

$

17,271


$

8,526



$

26,000


$

25,947


Bombshells


369



(170)




1,480



(268)


Other


(682)



(220)




(1,995)



(521)


General corporate


(2,806)



(5,244)




(7,809)



(9,193)



$

14,152


$

2,892



$

17,676


$

15,965
















Reconciliation of Nightclubs GAAP operating income to non-GAAP operating income














Nightclubs operating income

$

17,271


$

8,526



$

26,000


$

25,947


Gain on settlement of Patron tax case


(8,167)



-




(8,167)



-


Litigation and other one-time settlements


10



3,233




10,560



3,503


Impairment of assets


-



-




1,358



-


Nightclubs non-GAAP operating income

$

9,114


$

11,759



$

29,751


$

29,450
















Nightclubs non-GAAP operating margin


29.8%



37.3%




31.8%



32.3%

RCI Hospitality Announces 3Q15 Club & Restaurant Sales Up 6.9%
PR Newswire RCI Hospitality Holdings, Inc.
15 hours ago
????
HOUSTON, July 9, 2015 /PRNewswire/ -- RCI Hospitality Holdings, Inc. (RICK) today announced total sales at adult clubs and bars/restaurants for the third fiscal quarter ended June 30, 2015. RCI expects to announce 3Q15 results on August 10, 2015.

View photo
.RCI HOSPITALITY HOLDINGS INC
Total club and restaurant sales reached $35.4 million compared to $33.1 million in the year ago quarter.
Same store sales were $30.2 million compared to $31.9 million in the year ago quarter.
There were 46 units in 3Q15 versus 43 in 3Q14.
Nightclub segment sales (includes adult clubs and nightclubs) totaled $30.6 million compared to $31.5 million in 3Q14.
Bombshells segment sales totaled $4.8 million compared to $1.6 million in 3Q14.
CEO Comment

Eric Langan, President and CEO, commented, "We're pleased at seeing a 6.9% year over year increase in total 3Q15 sales. This continues to demonstrate the soundness of our bar/restaurant strategy, which saw Bombshells segment sales up more than threefold year over year. On the other hand, the unusually severe rain and flooding in Texas contributed to a 5.3% decline in same store sales that affected our nightclub segment, in particular.

"Total club and restaurant sales benefitted from new adult clubs–Rick's Cabaret in Odessa, TX, the January acquisition of Down in Texas Saloon in Austin, TX, and the May acquisition of The Seville Club of Minneapolis—and from new Bombshells in Austin, Spring, and Houston, TX. In addition to weather, many units opened for more than a year faced tough comparisons against last year's strong line up of sporting events. While showing the Mayweather-Pacquiao fight at many locations helped 3Q15, it was difficult to overcome the benefit in 3Q14 of the New York Rangers in the Stanley Cup Finals and both the Miami Heat and the San Antonio Spurs in the NBA Finals."

About RCI Hospitality Holdings, Inc. (RICK)

With 46 units, RCI Hospitality Holdings, Inc., through its subsidiaries, is the country's leading company in adult gentlemen clubs and sports bars/restaurants. Adult clubs in New York City, Miami, Philadelphia, Charlotte, Dallas/Ft. Worth, Houston, Minneapolis, Indianapolis and other cities operate under brand names, such as "Rick's Cabaret," "XTC," "Club Onyx," "Vivid Cabaret," "Jaguars" and "Tootsie's Cabaret." Sports bars/restaurants operate under the brand name "Bombshells." Please visit http://www.rcihospitality.com/

Forward-Looking Statements

This press release may contain forward-looking statements that involve a number of risks and uncertainties that could cause the company's actual results to differ materially from those indicated in this press release, including the risks and uncertainties associated with operating and managing an adult business, the business climates in cities where it operates, the success or lack thereof in launching and building the company's businesses, risks and uncertainties related to the operational and financial results of our Web sites, conditions relevant to real estate transactions, and numerous other factors such as laws governing the operation of adult entertainment businesses, competition and dependence on key personnel. The company has no obligation to update or revise the forward-looking statements to reflect the occurrence of future events or circumstances.

All references to, the "company," "we," "our," and similar terms include RCI Hospitality Holdings, Inc. and its subsidiaries, unless the context indicates otherwise.

RCI Hospitality Holdings, Inc. Reports Fiscal 2Q15 Results

Non-GAAP EPS of $0.50 Up 11% Year over Year


PR Newswire
RCI Hospitality Holdings, Inc.
May 11, 2015 4:05 PM

HOUSTON, May 11, 2015 /PRNewswire/ -- RCI Hospitality Holdings, Inc. (RICK) today announced results for the fiscal 2015 second quarter ended March 31, 2015.

.RCI HOSPITALITY HOLDINGS INC
2Q15 Highlights
•GAAP EPS of ($0.28) includes an accrual for the previously announced NY FLSA legal settlement.
•Non-GAAP EPS* diluted of $0.50 increased 11.1% from $0.45 in 2Q14. Non-GAAP EPS excludes the accrual as well as other items from both periods for comparability.
•Record total revenues of $37.4 million grew 13.8% year over year.
•$1.9 million spent buying back shares in the open market in the first half of Fiscal 2015.
•Company on track for a strong FY15.

Conference Call

A conference call to discuss these results, outlook and related matters will be held today, May 11, 2015, at 4:30 PM ET:
•Live Participant Dial In (Toll Free): 877-737-7051
•Live Participant Dial In (International): 201-689-8878
•Webcast URL: http://www.investorcalendar.com/IC/CEPage.asp?ID=173981

Meet Management

Eric Langan, President and CEO, invites investors for a "Due Diligence Ball" to meet, talk and tour one of RCI's top revenue generating clubs.
•When: Monday, May 11, 2015, 6:00 PM to 8:00 PM ET
•Where: Rick's Cabaret New York, at 50 W. 33rd Street, between Fifth Avenue and Broadway
•RSVP: With your contact information to gary.fishman@anreder.com

CEO Comment

"RCI performed well in 2Q15," said Mr. Langan. "We achieved record revenues and strong year over year growth in non-GAAP EPS and adjusted EBITDA, which reflects our cash generating power.

"Our performance was especially favorable since 2Q15 was affected by bad weather, especially in the Dallas-Fort Worth area, where we operate 11 clubs. We also had tough comparisons to 2Q14, when we benefitted from the big football championship in the New York City area, where we have two top clubs.

"Core profitability in nightclubs expanded due to higher revenues and margin improvement. With more units and increased revenues, our Bombshells restaurant/bar segment also added positively to results.

"We repurchased more stock in the open market, reflecting confidence in our favorable outlook, combined with the market's undervaluation of our shares. We will continue to focus cash flow on buying back shares. At current levels, our own assets represent a highly attractive return.

"We are on track for a strong Fiscal 2015. Year to date, total revenues are up 18.6%, adjusted EBITDA 22.7%, and non-GAAP EPS 23.1%.

"We look forward to a solid third quarter. Many units benefitted from our showing the recent Mayweather-Pacquiao 'Fight of the Century'. Warm weather in Texas should further enhance Bombshells' patio business."

2Q15 Analysis (all comparisons to 2Q14 unless otherwise noted)

Total Revenues
•Total revenues of $37.4 million compared to $32.9 million.
•45 units (40 adult clubs and nightclubs and 5 restaurants) versus 43 (41 adult clubs and nightclubs and 2 restaurants).
•Same store sales increased 2.1%.
•Units opened less than a year added $4.4 million. This included new adult clubs – Rick's Cabaret in Odessa, TX and the recently acquired Down in Texas Saloon in Austin, TX – and new Bombshells in Austin, Spring and Houston, TX.

Operating Margin & Costs (as % of revenues)
•GAAP operating margin was (7.0%), reflecting the previously mentioned accrual, compared to 22.7%.
•Non-GAAP operating margin, which excludes the accrual and certain other non-operating items from both periods for more meaningful analysis, was 24.9% compared to 26.9%.
•Non-GAAP operating margin reflects the growth of the Bombshells segment, whose margins, while growing, are less than that of the nightclub segment. This was partially offset by the elimination of under-performing adult clubs.
•The accrual of $10.3 million pre-tax, or ($0.65) per share net of tax, represents the company's best estimate at this time of the total cost of the settlement, announced April 1, 2015, in its New York federal wage and hour class action case.

Adjusted EBITDA
•RCI's cash generating power, as reflected by adjusted EBITDA*, amounted to $10.2 million, up 10.8% from $9.2 million in the year ago quarter.

Business Segments (all comparisons to 2Q14 unless otherwise noted)

Nightclubs
•Includes the company's 38 adult clubs and two bar/nightclubs, compared to a total of 41 in the year ago quarter.
•Sales increased 2.4%, to $31.9 million from $31.2 million.
•Operating income was $114,000 compared to $9.6 million.
•Excluding the previously mentioned accrual, operating income increased 8.0% to $10.4 million and operating margin expanded to 32.6% from 30.9%.
•In May, RCI subsidiaries acquired The Seville Club, a popular gentlemen's club in Minneapolis known for its famous downtown location, as previously announced. Total consideration of $8.5 million consisted of $4.5 million for the assets of the club business and $4.0 million for its historic building.

Bombshells
•Includes the company's five Bombshells, all in Texas, compared to two in the year ago quarter.
•Sales increased nearly 3.5 times, to $4.8 million from $1.4 million.
•Operating income was $571,000 compared to a loss of $12,000.
•Operating margin expanded to 11.9% of revenues from (0.9%) and is expected to increase as revenues continue to build and training costs subside.
•A sixth Bombshells is planned for the Willowbrook area of northwest Houston. Management is identifying additional locations.

Balance Sheet (March 31, 2015 compared to December 31, 2014)
•Assets increased 4.1% to $260.5 million and long term debt increased 2.4% to $71.5 million. The increases primarily reflected the acquisition of the Down in Texas Saloon of Austin and related real estate.
•Total permanent stockholders' equity declined 2.8% to $120.8 million, primarily reflecting the NY FLSA accrual partially offset by core profits.

Stock Buy Backs
•The Board of Directors increased its stock repurchase authorization to $10.0 million in May 2014.
•During 2Q15, RCI purchased 82,811 shares of common in the open market for an aggregate cost of $840,340, leaving $7.0 million of remaining authorization.
•During the six months ended March 31, 2015, RCI purchased 192,427 shares at a cost of $1.9 million.

*Non-GAAP Financial Measures

In addition to our financial information presented in accordance with GAAP, management uses certain "non-GAAP financial measures" within the meaning of the SEC Regulation G, to clarify and enhance understanding of past performance and prospects for the future. Generally, a non-GAAP financial measure is a numerical measure of a company's operating performance, financial position or cash flows that excludes or includes amounts that are included in or excluded from the most directly comparable measure calculated and presented in accordance with GAAP. We monitor non-GAAP financial measures because it describes the operating performance of the company and helps management and investors gauge our ability to generate cash flow, excluding some recurring charges that are included in the most directly comparable measures calculated and presented in accordance with GAAP. Relative to each of the non-GAAP financial measures, we further set forth our rationale as follows:
•Non-GAAP Operating Income and Non-GAAP Operating Margin. We exclude from non-GAAP operating income and non-GAAP operating margin amortization of intangibles, patron taxes, pre-opening costs, gains and losses from asset sales, stock-based compensation charges, litigation and other one-time legal settlements, gain on contractual debt reduction and acquisition costs. We believe that excluding these items assists investors in evaluating period-over-period changes in our operating income and operating margin without the impact of items that are not a result of our day-to-day business and operations.


•Non-GAAP Net Income and Non-GAAP Net Income per Basic Share and per Diluted Share. We exclude from non-GAAP net income and non-GAAP net income per diluted share and per basic share amortization of intangibles, patron taxes, pre-opening costs, income tax expense, impairment charges, gains and losses from asset sales, stock-based compensation, litigation and other one-time legal settlements, gain on contractual debt reduction and acquisition costs, and include the Non-GAAP provision for income taxes, calculated as the tax-effect at 35% effective tax rate of the pre-tax non-GAAP income before taxes less stock-based compensation, because we believe that excluding such measures helps management and investors better understand our operating activities.


•Adjusted EBITDA. We exclude from earnings before interest, taxes, depreciation and amortization (EBITDA) depreciation expense, amortization of intangibles, income tax, interest expense, interest income, gains and losses from asset sales, acquisition costs, litigation and other one-time legal settlements, gain on contractual debt reduction and impairment charges because we believe that adjusting for such items helps management and investors better understand operating activities. Adjusted EBITDA provides a core operational performance measurement that compares results without the need to adjust for Federal, state and local taxes which have considerable variation between domestic jurisdictions. Also, we exclude interest cost in our calculation of Adjusted EBITDA. The results are, therefore, without consideration of financing alternatives of capital employed. We use Adjusted EBITDA as one guideline to assess our unleveraged performance return on our investments. Adjusted EBITDA is also the target benchmark for our acquisitions of nightclubs.

Full Financial Tables

RCI's Form 10Q for the fiscal second quarter ended Mach 31, 2015 with full financial tables can be found on the company's corporate site at http://www.rcihospitality.com.

About RCI Hospitality Holdings, Inc. (RICK)

With 46 units, RCI Hospitality Holdings, Inc., through its subsidiaries, is the country's leading company in adult gentlemen clubs and restaurant/bars. Adult clubs in New York City, Miami, Philadelphia, Charlotte, Dallas/Ft. Worth, Houston, Minneapolis, Indianapolis and other cities operate under brand names, such as "Rick's Cabaret," "XTC," "Club Onyx," "Vivid Cabaret," "Jaguars" and "Tootsie's Cabaret." Restaurant/bars operate under the brand name "Bombshells." Please visit http://www.rcihospitality.com/

RCI Hospitality in 2015 is celebrating the 20th anniversary of its IPO – two decades of innovation in the adult club segment of the hospitality industry.

Forward-Looking Statements

This press release may contain forward-looking statements that involve a number of risks and uncertainties that could cause the company's actual results to differ materially from those indicated in this press release, including the risks and uncertainties associated with operating and managing an adult business, the business climates in cities where it operates, the success or lack thereof in launching and building the company's businesses, risks and uncertainties related to the operational and financial results of our Web sites, conditions relevant to real estate transactions, and numerous other factors such as laws governing the operation of adult entertainment businesses, competition and dependence on key personnel. The company has no obligation to update or revise the forward-looking statements to reflect the occurrence of future events or circumstances.







RCI HOSPITALITY HOLDINGS, INC. AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF INCOME





















FOR THE THREE MONTHS



FOR THE SIX MONTHS


ENDED MARCH 31,

ENDED MARCH 31,




2015



2014



2015



2014


(in thousands, except per share data)


(UNAUDITED)



(UNAUDITED)















Revenues:

















Sales of alcoholic beverages


$

15,576



$

12,985



$

30,815



$

24,674


Sales of food and merchandise



5,241




3,979




10,466




7,402


Service revenues



14,559




14,347




28,783




27,077


Other



2,034




1,559




3,833




3,140


Total revenues



37,410




32,870




73,897




62,293



















Operating expenses:

















Cost of goods sold



5,381




4,041




10,492




7,788


Salaries and wages



8,115




6,854




16,147




13,431


Stock compensation



120




151




240




154


Other general and administrative:

















Taxes and permits



5,709




5,142




11,102




9,557


Charge card fees



544




449




1,091




877


Rent



1,184




1,156




2,325




2,384


Legal and professional



1,064




426




2,023




1,214


Advertising and marketing



1,312




1,406




2,679




2,691


Insurance



801




972




1,621




1,771


Utilities



708




646




1,442




1,241


Depreciation and amortization



1,886




1,513




3,531




2,906


(Gain) loss on sale of property



(18)




(86)




(18)




(86)


Impairment of assets



-




-




1,358




-


Settlement of lawsuits and other one-time costs



10,303




150




10,550




270


Other



2,917




2,591




5,790




5,022


Total operating expenses



40,026




25,411




70,373




49,220


Operating income (loss)



(2,616)




7,459




3,524




13,073



















Other income (expense):

















Interest income



26




35




39




112


Interest expense



(1,783)




(1,924)




(3,402)




(3,936)


Gain from original investment in Drink Robust, Inc.



-




-




577




-


Income (loss) before income taxes



(4,373)




5,570




738




9,249


Income taxes (benefit)



(1,265)




1,922




581




3,245


Net income (loss)



(3,108)




3,648




157




6,004


Less: net (income) loss attributable to noncontrolling interests



267




74




362




121


Net income (loss) attributable to RCI Hospitality Holdings, Inc.


$

(2,841)



$

3,722



$

519



$

6,125



















Basic earnings (loss) per share attributable to RCIHH shareholders:
















Net income


$

(0.28)



$

0.39



$

0.05



$

0.64


Diluted earnings (loss) per share attributable to RCIHH shareholders:
















Net income


$

(0.28)



$

0.37



$

0.05



$

0.62



















Weighted average number of common shares outstanding:

















Basic



10,275




9,661




10,269




9,604


Diluted



10,275




10,853




10,273




10,763























RCI HOSPITALITY HOLDINGS, INC. AND SUBSIDIARIES


NON-GAAP FINANCIAL MEASURES












For the Three Months


For the Six Months



Ended March 31,


Ended March 31,









(in thousands, except per share data)

2015


2014


2015


2014











Reconciliation of GAAP net income to









Adjusted EBITDA









GAAP net income (loss)

($2,841)


$3,722


$519


$6,125


Income tax expense

(1,265)


1,922


362


3,245


Interest expense and income and gain on Drink Robust investment

1,783


1,924


3,402


3,936


Litigation and other one-time legal settlements

10,303


150


10,550


270


Preopening costs

268


-


328


-


Acquisition costs

95


-


178


-


Impairment of assets

-


-


1,358


-


Depreciation and amortization

1,886


1,513


3,531


2,906


Adjusted EBITDA

$10,229


$9,231


$20,228


$16,482











Reconcilation of GAAP net income (loss) to









non-GAAP net income









GAAP net income (loss)

($2,841)


$3,722


$519


$6,125


Patron tax

805


866


1,567


1,605


Amortization of intangibles

336


82


579


171


Gain on Drink Robust investment

-


-


(577)


-


Stock-based compensation

120


151


240


154


Litigation and other one-time settlements

10,303


150


10,550


270


Pre-opening costs

268


122


328


416


Income tax expense

(1,265)


1,922


362


3,245


Acquisition costs

95


18


178


18


Impairment of assets

-


-


1,358


-


Non-GAAP provision for income taxes

(2,695)


(2,409)


(5,202)


(4,148)


Non-GAAP net income

$5,126


$4,624


$9,902


$7,857











Reconciliation of GAAP diluted net income









per share to non-GAAP diluted net income per share









Fully diluted shares

10,275


10,853


10,273


10,763


GAAP net income

($0.28)


$0.37


$0.05


$0.62


Patron tax

0.08


0.08


0.15


0.15


Amortization of intangibles

0.03


0.01


0.06


0.02


Gain on Drink Robust investment

-


-


(0.06)


-


Stock-based compensation

0.01


0.01


0.02


0.01


Litigation and other one-time settlements

1.00


0.01


1.03


0.03


Pre-opening costs

0.03


0.01


0.03


0.04


Income tax expense

(0.12)


0.18


0.04


0.30


Acquisition costs

0.01


0.00


0.02


0.00


Impairment of assets

-


-


0.13


-


Non-GAAP provision for income taxes

(0.26)


(0.22)


(0.51)


(0.39)


Non-GAAP diluted net income per share

$0.50


$0.45


$0.96


$0.78













RCI HOSPITALITY HOLDINGS, INC. AND SUBSIDIARIES


NON-GAAP FINANCIAL MEASURES












For the Three Months


For the Six Months



Ended March 31,


Ended March 31,









(in thousands, except per share data)

2015


2014


2015


2014











Reconciliation of GAAP operating income to









non-GAAP operating income









GAAP operating income (loss)

($2,616)


$7,459


$3,524


$13,073


Patron tax

805


866


1,567


1,605


Amortization of intangibles

336


82


579


171


Stock-based compensation

120


151


240


154


Impairment of assets

-


-


-


-


Litigation and other one-time settlements

10,303


150


10,550


270


Pre-opening costs

268


122


328


416


Acquisition costs

95


18


178


18


Non-GAAP operating income

$9,311


$8,848


$16,966


$15,707











Reconciliation of GAAP operating margin to









non-GAAP operating margin









GAAP operating income

-7.0%


22.7%


4.8%


21.0%


Patron tax

2.2%


2.6%


2.1%


2.6%


Amortization of intangibles

0.9%


0.2%


0.8%


0.3%


Stock-based compensation

0.3%


0.5%


0.3%


0.2%


Impairment of assets

0.0%


0.0%


0.0%


0.0%


Litigation and other one-time settlements

27.5%


0.5%


14.3%


0.4%


Pre-opening costs

0.7%


0.4%


0.4%


0.7%


Acquisition costs

0.3%


0.1%


0.2%


0.0%


Non-GAAP operating margin

24.9%


26.9%


23.0%


25.2%













RCI HOSPITALITY HOLDINGS, INC. AND SUBSIDIARIES



SEGMENT INFORMATION





















For the Three Months



For the Six Months




Ended March 31,



Ended March 31,



(in thousands)

2015



2014



2015



2014
















Business segment sales:













Nightclubs

$

31,933



$

31,196



$

62,995



$

59,550



Bombshells


4,813




1,379




9,721




2,083



Other


664




295




1181




660




$

37,410



$

32,870



$

73,897



$

62,293




















Business segment operating income (loss):

















Nightclubs*

$

114



$

9,644



$

8,671



$

17,618



Bombshells


571




(12)




1,111




(317)



Other


(797)




(87)




(1,344)




(257)



General corporate


(2,504)




(2,086)




(4,914)




(3,971)




$

(2,616)



$

7,459



$

3,524



$

13,073




















* Nightclubs operating income for the three and six months ended 3/31/15 includes accrual of $10,303 for the settlement of a lawsuit, and for the six months ended 3/31/15 also includes impairment of assets of $1,358. Excluding these items, nightclubs operating income for the three months ended 3/31/15 would have been $10,417 and for the six months ended 3/31/15 would have been $20,332.



















Logo - http://photos.prnewswire.com/prnh/20140805/133696

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/rci-hospitality-holdings-inc-reports-fiscal-2q15-results-300081198.html