Rick’s Cabaret International, Inc. (NASDAQ: RICK), the
nation’s leading group of upscale gentlemen’s clubs, today reported
net income of $2.1 million for the period ending December 31, 2010,
compared with $783,000 in the same period last year, a 165 percent
increase. Net income per fully diluted share for the quarter was 21
cents, compared with 8 cents in the previous year. The company had
revenues of $20.9 million in its first quarter, compared with $20
million for the same period last year.
The improvement in net income was due primarily to a combination
of the higher revenues and lower operating expenses, which dropped
to $16.7 million compared with $17.6 million for the same quarter
last year.
The increase in total revenue was attributed primarily to the
addition of $1.4 million in sales from two new clubs in Fort Worth
and one in Austin.
“We had a very good quarter and we are happy with our start for
the 2011 fiscal year,” said Eric Langan, President and CEO
of Rick’s Cabaret, which now includes 22 clubs nationwide. “Our
major clubs in New York City and Miami continue to thrive. We
opened a new club just outside the Dallas/Fort Worth Airport in
January, and we had a total of seven clubs in the DFW Metroplex to
serve Super Bowl fans. We expect to remain on track to make at
least one acquisition per quarter for the balance of this
year.”
Other highlights of the first quarter:
- There was a significant decrease in
advertising and marketing expenses, principally through the
reduction of marketing costs in Las Vegas during 2010 and reduced
radio advertising in the Dallas/Fort Worth market.
- Rick’s Cabaret in Las Vegas lost
approximately $370,000 for the quarter ending December 31, 2010, on
revenues of $1.1 million, compared with a loss for the quarter in
the previous year of $500,000 on revenues of $3.1
million.
- The company’s Media Division lost
approximately $76,000 before income taxes for the quarter, compared
with approximately $65,000 in the 2009 quarter, but as the economy
improves the company believes the division will become profitable
through more cost control and increased revenues.
- During the three months ended December
31, 2010, the company purchased 90,800 shares of common stock in
the open market at prices ranging from $7.03 to $7.43 which
compares with the purchase of 48,200 shares in the previous years
at prices ranging from $3.54 to $5.95.
- The company had cash on hand at the end
of the quarter of $18.7 million compared with $9.5 million in the
previous year, having generated $2.8 million from operating
activities vs. $3.2 million last year. At the end of the quarter
the company had working capital of $5.1 million compared to
$377,552 last year, a result of increased profit and also the net
cash still available from the convertible debt, which is
principally long-term in nature.
RICK'S CABARET INTERNATIONAL, INC. AND
SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
(in thousands,
except per share data)
December 31,
2010
September 30, 2010 Assets
(UNAUDITED) Current assets: Cash and cash equivalents $
18,719 $ 19,168 Accounts receivable: Trade, net 830 888 Other, net
278 204 Marketable securities 479 - Inventories 1,481 1,264
Deferred tax asset 1,753 1,504 Prepaid expenses and other current
assets 716 951 Assets of discontinued operations 133 148 Total
current assets 24,389 24,127 Property and equipment, net
59,262 59,559 Other assets: Goodwill and indefinite lived
intangibles, net 62,076 62,076 Definite lived intangibles, net
1,080 1,197 Other 1,520 1,412 Total other assets 64,676 64,685
Total assets $ 148,327 $ 148,371
LIABILITIES AND STOCKHOLDERS’
EQUITY
(in thousands,
except per share data)
December 31,
2010
September 30, 2010
Liabilities and Stockholders' Equity (UNAUDITED)
Current liabilities: Accounts payable
$
629
$
731
Accrued liabilities 4,106 4,529 Texas patron tax liability 4,650
3,955 Current portion of derivative liabilities 1,236 1,276 Current
portion of long-term debt 8,663 7,883 Liabilities of discontinued
operations 53 47 Total current liabilities
19,337 18,421 Deferred tax liability 15,456 15,566 Other
long-term liabilities 736 719 Long-term debt 33,446 34,803
Derivative liabilities at fair value, less current portion
816 1,243 Total liabilities 69,791 70,752
Commitments and contingencies
Temporary equity - Common stock, subject
to put rights 198 and 317 shares, respectively
4,020 4,366 PERMANENT STOCKHOLDERS' EQUITY:
Preferred stock, $.10 par, 1,000 shares
authorized; none issued and outstanding
- -
Common stock, $.01 par, 20,000 shares
authorized; 9,676 and 9,766 shares issued and
outstanding, respectively
97 98 Additional paid-in capital 61,542 62,326 Accumulated other
comprehensive loss (26 ) - Retained earnings 9,590
7,515 Total Rick’s permanent stockholders’ equity 71,203
69,939 Noncontrolling interests 3,313 3,314
Total permanent stockholders’ equity 74,516
73,253 Total liabilities and stockholders’ equity $ 148,327
$
148,371
RICK'S CABARET INTERNATIONAL,
INC.
CONSOLIDATED STATEMENTS OF
INCOME
Three Months Ended December 31,
(in thousands,
except per share data)
2010 2009 (UNAUDITED) Revenues: Sales
of alcoholic beverages $ 8,359 $ 8,050 Sales of food and
merchandise 1,784 1,590 Service revenues 9,412 9,292 Internet
revenues 125 145 Media revenues 216 257 Other 962
671 Total revenues 20,858 20,005 Operating
expenses: Cost of goods sold 2,518 2,456 Salaries and wages 4,676
4,310 Stock-based compensation - 44 Other general and
administrative: Taxes and permits 3,063 2,836 Charge card fees 364
346 Rent 1,079 993 Legal and professional 485 650 Advertising and
marketing 1,183 2,938 Depreciation and amortization 1,072 842
Insurance 303 262 Utilities 406 406 Other 1,579
1,536 Total operating expenses 16,728
17,619 Income from operations 4,130 2,386
Other income (expense): Interest income 12 4 Interest
expense (1,124 ) (1,029 ) Gain on change in fair value of
derivative instruments 148 44
Income from continuing operations before income taxes 3,166 1,405
Income taxes 1,026 514
Income from continuing operations 2,140 891 Loss from discontinued
operations, net of income taxes (11 ) (35 )
Net income 2,129 856 Less: net income attributable to
noncontrolling interests (53 ) (73 ) Net income
attributable to Rick’s Cabaret International, Inc. $ 2,076 $
783 Basic earnings (loss) per share attributable to Rick’s
shareholders: Income from continuing operations $ 0.21 $ 0.09 Loss
from discontinued operations (0.00 ) (0.00 ) Net
income $ 0.21 $ 0.08 Diluted earnings (loss) per
share attributable to Rick’s shareholders: Income from continuing
operations $ 0.21 $ 0.09 Loss from discontinued operations
(0.00 ) (0.00 ) Net income $ 0.21 $ 0.08
Weighted average number of common shares outstanding: Basic
10,043 9,370 Diluted 10,045 9,385
About Rick’s Cabaret: Rick’s Cabaret International, Inc.
(NASDAQ: RICK) is home to 22 upscale adult nightclubs serving
primarily businessmen and professionals that offer live
entertainment, dining and bar operations. Nightclubs in New York
City, Miami, Philadelphia, New Orleans, Charlotte, Dallas, Houston,
Minneapolis and other cities operate under the names "Rick's
Cabaret," "XTC," “Club Onyx” and “Tootsie’s Cabaret”. Sexual
contact is not permitted at these locations. Rick’s Cabaret also
operates a media division, ED Publications, and owns the adult
Internet membership Website couplestouch.com as well as a network
of online adult auction sites under the flagship URL
naughtybids.com. Rick’s Cabaret common stock is traded on NASDAQ
under the symbol RICK. For further information contact ir@ricks.com
or visit ricksinvestor.com.
Forward-looking Statements: This document contains
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 document, 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. Additional
factors that could cause the Company’s results to differ materially
from those described in the forward-looking statements are
described in forms filed with the SEC from time to time and
available at ricksinvestor.com or on the SEC's internet website at
sec.gov. Rick's has no obligation to update or revise the
forward-looking statements to reflect the occurrence of future
events or circumstances. For further information visit
ricksinvestor.com.
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