HOUSTON, Dec. 14, 2011 /PRNewswire/ -- Rick's
Cabaret International, Inc. (NASDAQ: RICK), the nation's
leading group of upscale adult nightclubs, today reported its
revenue for the year ended Sept. 30,
2011 rose to $83.5 million, a
12.7 percent increase over the $74.0
million in 2010. Net income was $7.8
million, compared with a loss of $8.0
million in the previous year. Fully diluted earnings per
share were $.79 vs. a loss of
$.82 last year.
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"Our strong fiscal 2011 results reflect a return to more normal
growth patterns for the company across the board and the fact that
we are no longer impacted by the drag from the now discontinued
operation in Las Vegas," said
Eric Langan, President and
CEO of Rick's Cabaret, which operates 23 clubs around the country.
"We are continuing the momentum we built in fiscal 2011 and we look
forward to another strong year in 2012."
Mr. Langan said the revenue improvement included a 4.9 percent
increase in sales at clubs open more than one year, particularly
the New York City location, and
about $6.1 million from new clubs
acquired in 2010 and 2011. The results also reflect the closing of
the Las Vegas club in April 2011, which was shut after determining it
could not be made viable in the foreseeable future.
In a Form 10-K filed with the SEC today, the company also
reported results for its fourth quarter ending September 30th, showing revenues of $21.5 million compared with $19.1 million for the same quarter in the prior
year; net income of $2.0 million,
compared with a loss of $12.5 million
in 2010; fully diluted earnings per share of 20 cents, versus a loss of $1.24 last year.
Key factors in the full fiscal year 2011 results include:
- Adjusted EBITDA (earnings before interest expense,
income taxes, depreciation, amortization, and impairment charges)
was $23.6 million in 2011, compared
with $17.9 million last year. The
company uses non-GAAP adjusted EBITDA as a core operational
performance measurement it feels more accurately reflects the
performance of the company in part because it allows companies to
express results without the need to adjust for Federal, state and
local taxes, which vary considerably by jurisdiction. (See
Note below.)
- Operating margins (excluding impairment) were 22.5 percent for
the year, compared to 20.0 percent in the prior year.
- Income from operations for same-location-same-period nightclubs
open more than a year increased by 18.3%.
- Net cash provided by operating activities increased to
$18.9 million from $17.3 million in the prior year.
- Interest expense declined to $3.9
million from $4.0
million as the company amortized loan balances. As of
September 30, 2011, the balance of
long-term debt was $35.6
million compared to $42.7
million a year earlier.
- Legal and professional fees declined to $2.3 million from $3.0
million, reflecting a decrease in costs related to
litigation for claims under the Fair Labor Standards Act.
- No continuing operations assets were impaired in 2011, compared
with $3.6 million in impairment
charges in 2010.
- Revenue improvements were noted in all three of the major
revenue categories tracked by the company: alcoholic beverage sales
were $32.6 million compared with
$28.5 million last year; food and
merchandise was $7.4 million compared
with $6.3 million; service revenues
were $38.2 million compared with
$34.2 million.
Note: Adjusted EBITDA is a financial statement
measure that was not derived in accordance with GAAP. We use
Adjusted EBITDA (earnings before interest expense, income
taxes, depreciation, amortization and impairment charges) as a
non-GAAP performance measure. In calculating Adjusted
EBITDA, we exclude our largest recurring non-cash charge,
depreciation, amortization and impairment charges. 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.
About Rick's Cabaret: Rick's Cabaret International, Inc.
(NASDAQ: RICK) is home to 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.
Forward-looking Statements: Certain statements contained
in this release regarding Rick's Cabaret future operating results
or performance or business plans or prospects and any other
statements not constituting historical fact are "forward-looking
statements" subject to the safe harbor created by the Private
Securities Litigation Reform Act of 1995. Where possible, the
words "believe," "expect," "anticipate," "intent," "would," "will,"
"planned," "estimated," "potential," "goal," "outlook," and similar
expressions, as they relate to the company or its management have
been used to identify such forward-looking statements. All
forward-looking statements reflect only current beliefs and
assumptions with respect to future business plans, prospects,
decisions and results, and are based on information currently
available to the company. Accordingly, the statements
are subject to significant risks, uncertainties and contingencies,
which could cause the company's actual operating results,
performance or business plans or prospects to differ materially
from those expressed in, or implied by, these statements.
Such risks, uncertainties and contingencies include, but are not
limited to, risks and uncertainties associated with (i) operating
and managing an adult business, (ii) the business climates in
cities where the company operates, (iii) the success
or lack thereof in launching and building the company's
businesses, (iv) the operational and financial results of the
company's adult nightclubs, (v) conditions relevant to real estate
transactions, (vi) the loss of key personnel, and (vii) laws
governing the operation of adult entertainment businesses.
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 www.ricksinvestor.com or on the SEC's internet website
at www.sec.gov. Unless required by law, Rick's Cabaret does
not undertake any obligation to update publicly any forward-looking
statements, whether as a result of new information, future events,
or otherwise.
Consolidated Balance Sheets and Statement of
Operations Follow
|
|
RICK'S
CABARET INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
September 30,
|
|
(in
thousands, except per share data)
|
|
2011
|
|
|
2010
|
|
Assets
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and
cash equivalents
|
|
$
|
9,698
|
|
|
$
|
18,599
|
|
Accounts
receivable:
|
|
|
|
|
|
|
|
|
Trade, net
|
|
|
779
|
|
|
|
662
|
|
Other, net
|
|
|
1,161
|
|
|
|
204
|
|
Marketable
securities
|
|
|
515
|
|
|
|
-
|
|
Inventories
|
|
|
1,174
|
|
|
|
1,082
|
|
Deferred
tax asset
|
|
|
5,195
|
|
|
|
1,504
|
|
Prepaid
expenses and other current assets
|
|
|
1,025
|
|
|
|
863
|
|
Assets of
discontinued operations
|
|
|
112
|
|
|
|
4,851
|
|
Total
current assets
|
|
|
19,659
|
|
|
|
27,765
|
|
|
|
|
|
|
|
|
|
|
Property
and equipment, net
|
|
|
65,892
|
|
|
|
56,786
|
|
|
|
|
|
|
|
|
|
|
Other
assets:
|
|
|
|
|
|
|
|
|
Goodwill
and indefinite lived intangibles, net
|
|
|
65,642
|
|
|
|
61,761
|
|
Definite
lived intangibles, net
|
|
|
1,091
|
|
|
|
1,139
|
|
Other
|
|
|
1,093
|
|
|
|
920
|
|
Total
other assets
|
|
|
67,826
|
|
|
|
63,820
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
153,377
|
|
|
$
|
148,371
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders'
Equity
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
1,215
|
|
|
$
|
696
|
|
Accrued
liabilities
|
|
|
2,766
|
|
|
|
4,301
|
|
Texas
patron tax liability
|
|
|
6,830
|
|
|
|
3,955
|
|
Current
portion of derivative liabilities
|
|
|
1,209
|
|
|
|
1,276
|
|
Current
portion of long-term debt
|
|
|
5,494
|
|
|
|
7,883
|
|
Liabilities of discontinued operations
|
|
|
177
|
|
|
|
588
|
|
Total
current liabilities
|
|
|
17,691
|
|
|
|
18,699
|
|
|
|
|
|
|
|
|
|
|
Deferred
tax liability
|
|
|
23,033
|
|
|
|
15,288
|
|
Other
long-term liabilities
|
|
|
785
|
|
|
|
719
|
|
Long-term
debt
|
|
|
30,060
|
|
|
|
34,803
|
|
Derivative
liabilities at fair value, less current portion
|
|
|
-
|
|
|
|
1,243
|
|
Total
liabilities
|
|
|
71,569
|
|
|
|
70,752
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary
equity - Common stock, subject to put rights 66 and 198 shares,
respectively
|
|
|
1,586
|
|
|
|
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; 9,604 and 9,766 shares
issued and outstanding, respectively
|
|
|
96
|
|
|
|
98
|
|
Additional
paid-in capital
|
|
|
61,446
|
|
|
|
62,326
|
|
Accumulated other comprehensive income
|
|
|
10
|
|
|
|
-
|
|
Retained
earnings
|
|
|
15,361
|
|
|
|
7,515
|
|
Total
Rick's permanent stockholders' equity
|
|
|
76,913
|
|
|
|
69,939
|
|
Noncontrolling interests
|
|
|
3,309
|
|
|
|
3,314
|
|
Total
permanent stockholders' equity
|
|
|
80,222
|
|
|
|
73,253
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and stockholders' equity
|
|
$
|
153,377
|
|
|
$
|
148,371
|
|
RICK'S
CABARET INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
Year
Ended September 30,
|
|
(in
thousands, except per share data)
|
|
2011
|
|
2010
|
|
2009
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Sales of
alcoholic beverages
|
|
$
|
32,575
|
|
$
|
28,532
|
|
$
|
23,641
|
Sales of
food and merchandise
|
|
|
7,402
|
|
|
6,327
|
|
|
5,615
|
Service
revenues
|
|
|
38,178
|
|
|
34,179
|
|
|
31,786
|
Internet
revenues
|
|
|
470
|
|
|
562
|
|
|
641
|
Media
revenues
|
|
|
1,248
|
|
|
1,440
|
|
|
1,404
|
Other
|
|
|
3,618
|
|
|
3,023
|
|
|
2,328
|
Total
revenues
|
|
|
83,491
|
|
|
74,063
|
|
|
65,415
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
goods sold
|
|
|
10,427
|
|
|
9,136
|
|
|
7,884
|
Salaries
and wages
|
|
|
18,321
|
|
|
16,305
|
|
|
14,799
|
Stock-based compensation
|
|
|
8
|
|
|
405
|
|
|
96
|
Other
general and administrative:
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxes and
permits
|
|
|
12,542
|
|
|
11,452
|
|
|
8,351
|
Charge
card fees
|
|
|
1,361
|
|
|
1,229
|
|
|
1,300
|
Rent
|
|
|
2,988
|
|
|
2,737
|
|
|
2,166
|
Legal and
professional
|
|
|
2,289
|
|
|
3,002
|
|
|
2,848
|
Advertising and marketing
|
|
|
3,471
|
|
|
3,167
|
|
|
2,588
|
Depreciation and amortization
|
|
|
3,904
|
|
|
3,225
|
|
|
2,806
|
Insurance
|
|
|
1,157
|
|
|
985
|
|
|
894
|
Utilities
|
|
|
1,605
|
|
|
1,507
|
|
|
1,390
|
Impairment
of assets
|
|
|
-
|
|
|
3,574
|
|
|
-
|
Other
|
|
|
6,624
|
|
|
5,948
|
|
|
5,258
|
Total
operating expenses
|
|
|
64,697
|
|
|
62,672
|
|
|
50,380
|
Income
from operations
|
|
|
18,794
|
|
|
11,391
|
|
|
15,035
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
118
|
|
|
19
|
|
|
16
|
Interest
expense
|
|
|
(3,930)
|
|
|
(4,023)
|
|
|
(3,352)
|
Interest
expense – loan origination costs
|
|
|
(359)
|
|
|
(450)
|
|
|
(65)
|
Gain
(loss) on change in fair value of derivative instruments
|
|
|
129
|
|
|
(31)
|
|
|
145
|
Gain on
settlement of debt
|
|
|
903
|
|
|
-
|
|
|
-
|
Gain
(loss) on sale of property and other
|
|
|
-
|
|
|
(3)
|
|
|
182
|
Income
from continuing operations before income taxes
|
|
|
15,655
|
|
|
6,903
|
|
|
11,961
|
Income
taxes
|
|
|
5,403
|
|
|
2,998
|
|
|
4,013
|
Income
from continuing operations
|
|
|
10,252
|
|
|
3,905
|
|
|
7,948
|
Loss from
discontinued operations, net of income taxes
|
|
|
(2,195)
|
|
|
(11,603)
|
|
|
(2,446)
|
Net income
(loss)
|
|
|
8,057
|
|
|
(7,698)
|
|
|
5,502
|
Less: net
income attributable to
noncontrolling interests
|
|
|
(211)
|
|
|
(260)
|
|
|
(294)
|
Net income
(loss) attributable to Rick's Cabaret International,
Inc.
|
|
$
|
7,846
|
|
$
|
(7,958)
|
|
$
|
5,208
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
earnings (loss) per share attributable to Rick's
shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
from continuing operations
|
|
$
|
1.01
|
|
$
|
0.38
|
|
$
|
0.83
|
Loss from discontinued operations
|
|
|
(0.22)
|
|
|
(1.20)
|
|
|
(0.26)
|
Net income (loss)
|
|
$
|
0.79
|
|
$
|
(0.82)
|
|
$
|
0.56
|
Diluted
earnings (loss) per share attributable to Rick's
shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
from continuing operations
|
|
$
|
1.01
|
|
$
|
0.38
|
|
$
|
0.81
|
Loss from discontinued operations
|
|
|
(0.22)
|
|
|
(1.20)
|
|
|
(0.26)
|
Net income (loss)
|
|
$
|
0.79
|
|
$
|
(0.82)
|
|
$
|
0.55
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
9,930
|
|
|
9,697
|
|
|
9,266
|
Diluted
|
|
|
9,932
|
|
|
9,697
|
|
|
9,428
|
SOURCE Rick's Cabaret International, Inc.