HOUSTON, Aug. 8, 2013 /PRNewswire/ -- Rick's
Cabaret International, Inc. (NasdaqGM: RICK) today reported
consolidated total revenues of $28.3
million for its third quarter ended June 30, 2013, an increase of 18.3 percent over
the $23.9 million in the same period
last year.
(Logo:
http://photos.prnewswire.com/prnh/20110418/MM85342LOGO)
Consolidated net income was $2.2
million, an increase of 20.4 percent over the $1.8 million last year; non-GAAP* net income of
$3.4 million versus $2.6 million last year; GAAP earnings of
23 cents per diluted share vs.
19 cents last year; non-GAAP earnings
per share of 35 cents versus
27 cents last year; GAAP income from
operations this quarter was $5.7
million compared with $4.0
million in the same quarter last year while non-GAAP income
from operations** was $7.0 million
compared with $5.1 million.
Adjusted EBITDA*** was $6.9
million, versus $5.4 million
last year.
Net income was impacted by $540,000 in one time or unusual expenses of
$230,000 in costs for new businesses
yet to be opened, and $310,000 to
settle two lawsuits. "The quarter was strong and we are
particularly pleased with the performance of the Jaguars clubs and
our new Bombshells Restaurant in Dallas," said Eric
Langan, president and CEO of the company. "The
challenges of the last four years are largely behind us, we have
learned from mistakes such as the Las
Vegas acquisition, and we are now on a solid growth
trajectory."
Mr. Langan noted that the cost of goods sold for
same-location-same-period of club operations for the third quarter
was 12.9 percent, compared to 13.7 percent for the same period
ended June 30, 2012. The decrease was
due principally to the hiring of a corporate beverage director and
the continuing of the company's national buying power for alcoholic
beverages and energy drinks. Operating margin, the percentage of
operating income to total revenues, was 20 percent this year versus
16.9 percent.
Mr. Langan will discuss the quarterly results in a conference
call today at 4:30 p.m. EDT. The call
is being webcast by PrecisionIR, www.precisionir.com and can be
accessed at the Rick's Cabaret investor website,
www.ricksinvestor.com or via www.InvestorCalendar.com. The toll
free dial-in number is 877-407-8033; live international dial-in is
201-689-8033. The replay number is 877-660-6853
(International: 201-612-7415) with Conference ID 416486 and replay
is available until August 15th at
11:59 PM.
|
RICK'S CABARET
INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE
SHEETS
|
|
|
ASSETS
|
|
|
|
|
|
(in thousands,
except per share data)
|
|
|
June
30,
2013
|
|
September 30,
2012
|
|
Assets
|
|
|
(UNAUDITED)
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
$
9,045
|
|
|
|
$
5,520
|
|
Accounts
receivable:
|
|
|
|
|
|
|
|
|
Trade, net
|
|
|
1,876
|
|
|
|
1,743
|
|
Other, net
|
|
|
486
|
|
|
|
296
|
|
Marketable
securities
|
|
|
551
|
|
|
|
1,059
|
|
Inventories
|
|
|
1,475
|
|
|
|
1,260
|
|
Deferred tax
asset
|
|
|
4,463
|
|
|
|
3,635
|
|
Prepaid expenses and
other current assets
|
|
|
2,297
|
|
|
|
1,123
|
|
Assets of
discontinued operations
|
|
|
26
|
|
|
|
72
|
|
Total current
assets
|
|
|
20,219
|
|
|
|
14,708
|
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
|
95,359
|
|
|
|
79,940
|
|
|
|
|
|
|
|
|
|
Other
assets:
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
43,987
|
|
|
|
43,421
|
|
Other indefinite
lived intangibles
|
|
|
54,966
|
|
|
|
50,608
|
|
Definite lived
intangibles
|
|
|
1,153
|
|
|
|
1,177
|
|
Other
|
|
|
4,717
|
|
|
|
2,539
|
|
Total other
assets
|
|
|
104,823
|
|
|
|
97,745
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
|
$
220,401
|
|
|
|
$
192,393
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
(in thousands,
except per share data)
|
|
|
June
30,
2013
|
|
|
September
30, 2012
|
|
Liabilities and
Stockholders' Equity
|
|
|
(UNAUDITED)
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
2,364
|
|
$
|
1,865
|
|
Accrued
liabilities
|
|
|
6,878
|
|
|
4,298
|
|
Texas patron tax
liability
|
|
|
12,335
|
|
|
9,849
|
|
Current portion of
derivative liabilities
|
|
|
-
|
|
|
75
|
|
Current portion of
long-term debt
|
|
|
7,770
|
|
|
6,603
|
|
Liabilities of
discontinued operations
|
|
|
47
|
|
|
163
|
|
Total current
liabilities
|
|
|
29,394
|
|
|
22,853
|
|
|
|
|
|
|
|
|
Deferred tax
liability
|
|
|
25,824
|
|
|
23,963
|
|
Other long-term
liabilities
|
|
|
876
|
|
|
833
|
|
Long-term
debt
|
|
|
68,774
|
|
|
56,925
|
|
Total
liabilities
|
|
|
124,868
|
|
|
104,574
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary equity -
Common stock, subject to put rights zero and 9 shares,
respectively
|
|
|
-
|
|
|
207
|
|
|
|
|
|
|
|
|
PERMANENT
STOCKHOLDERS' EQUITY:
|
|
|
|
|
|
|
|
Preferred stock, $.10
par, 1,000 shares authorized; none issued and
outstanding
|
|
|
-
|
|
|
-
|
|
Common stock, $.01
par, 20,000 shares authorized; 9,520 and 9,584 shares issued and
outstanding, respectively
|
|
|
95
|
|
|
96
|
|
Additional paid-in
capital
|
|
|
61,554
|
|
|
61,212
|
|
Accumulated other
comprehensive income
|
|
|
46
|
|
|
59
|
|
Retained
earnings
|
|
|
30,536
|
|
|
22,939
|
|
Total Rick's
permanent stockholders' equity
|
|
|
92,231
|
|
|
84,306
|
|
Noncontrolling
interests
|
|
|
3,302
|
|
|
3,306
|
|
Total permanent
stockholders' equity
|
|
|
95,533
|
|
|
87,612
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders' equity
|
|
$
|
220,401
|
|
$
|
192,393
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RICK'S CABARET
INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF INCOME
|
|
|
|
|
|
(in thousands,
except per share data)
|
FOR THE THREE
MONTHS
ENDED JUNE
30,
|
|
FOR THE NINE
MONTHS
ENDED JUNE
30,
|
|
|
|
|
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
(UNAUDITED)
|
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
Sales of alcoholic
beverages
|
$
11,105
|
|
$
9,711
|
|
$
32,554
|
|
$
29,033
|
|
Sales of food and
merchandise
|
3,288
|
|
2,286
|
|
8,744
|
|
6,619
|
|
Service
revenues
|
12,382
|
|
10,576
|
|
38,089
|
|
31,743
|
|
Other
|
1,533
|
|
1,348
|
|
4,790
|
|
3,958
|
|
Total
revenues
|
28,308
|
|
23,921
|
|
84,177
|
|
71,353
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
3,680
|
|
3,279
|
|
10,561
|
|
9,601
|
|
Salaries and
wages
|
6,413
|
|
5,299
|
|
18,600
|
|
15,428
|
|
Stock
compensation
|
282
|
|
12
|
|
845
|
|
33
|
|
Other general and
administrative:
|
|
|
|
|
|
|
|
|
Taxes and
permits
|
4,275
|
|
3,618
|
|
13,069
|
|
11,018
|
|
Charge card
fees
|
410
|
|
361
|
|
1,126
|
|
1,042
|
|
Rent
|
846
|
|
726
|
|
2,199
|
|
2,150
|
|
Legal and
professional
|
642
|
|
992
|
|
2,263
|
|
2,433
|
|
Advertising
and marketing
|
1,181
|
|
959
|
|
3,452
|
|
2,994
|
|
Insurance
|
573
|
|
387
|
|
1,642
|
|
1,027
|
|
Utilities
|
523
|
|
454
|
|
1,564
|
|
1,264
|
|
Depreciation
and amortization
|
1,337
|
|
1,398
|
|
3,969
|
|
3,708
|
|
Settlement of
lawsuits
|
160
|
|
200
|
|
160
|
|
2,031
|
|
Loss on sale
of assets
|
-
|
|
332
|
|
-
|
|
332
|
|
Other
|
2,336
|
|
1,867
|
|
6,967
|
|
5,432
|
|
Total
operating expenses
|
22,658
|
|
19,884
|
|
66,417
|
|
58,493
|
|
Operating
income
|
5,650
|
|
4,037
|
|
17,760
|
|
12,860
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
Interest income and
other
|
(2)
|
|
(2)
|
|
6
|
|
2
|
|
Interest
expense
|
(1,868)
|
|
(1,098)
|
|
(5,273)
|
|
(3,178)
|
|
Gain (loss) on change
in fair value of derivative instruments
|
1
|
|
(17)
|
|
2
|
|
120
|
|
Income from
continuing operations before income taxes
|
3,781
|
|
2,920
|
|
12,495
|
|
9,804
|
|
Income
taxes
|
1,409
|
|
1,022
|
|
4,608
|
|
3,366
|
|
Income from
continuing operations
|
2,372
|
|
1,898
|
|
7,887
|
|
6,438
|
|
Loss from
discontinued operations, net of income taxes
|
(124)
|
|
(22)
|
|
(141)
|
|
(155)
|
|
Net income
|
2,248
|
|
1,876
|
|
7,746
|
|
6,283
|
|
Less: net income
attributable to noncontrolling interests
|
(53)
|
|
(53)
|
|
(159)
|
|
(159)
|
|
Net income
attributable to Rick's Cabaret International, Inc.
|
$
2,195
|
|
$
1,823
|
|
$
7,587
|
|
$
6,124
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss)
per share attributable to Rick's shareholders:
|
|
|
|
|
|
|
|
|
Income from
continuing operations
|
$
0.24
|
|
$
0.19
|
|
$
0.81
|
|
$
0.65
|
|
Loss from
discontinued operations
|
$
(0.01)
|
|
$
(0.00)
|
|
$
(0.01)
|
|
$
(0.02)
|
|
Net income
|
$
0.23
|
|
$
0.19
|
|
$
0.80
|
|
$
0.63
|
|
Diluted earnings
(loss) per share attributable to Rick's shareholders:
|
|
|
|
|
|
|
|
|
Income from
continuing operations
|
$
0.24
|
|
$
0.19
|
|
$
0.81
|
|
$
0.65
|
|
Loss from
discontinued operations
|
$
(0.01)
|
|
$
(0.00)
|
|
$
(0.01)
|
|
$
(0.02)
|
|
Net income
|
$
0.23
|
|
$
0.19
|
|
$
0.79
|
|
$
0.63
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
9,479
|
|
9,725
|
|
9,523
|
|
9,710
|
|
Diluted
|
9,647
|
|
9,731
|
|
9,871
|
|
9,717
|
The following tables present our non-GAAP measures for the
periods ended June 30, 2013 and 2012
(in thousands, except per share amounts):
|
For the Three
Months
|
|
For the Nine
Months
|
|
Ended June
30,
|
|
Ended June
30,
|
|
|
|
|
|
|
|
(in
thousands)
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
Reconciliation of
GAAP net income to
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
|
GAAP net
income
|
$
2,195
|
|
$
1,823
|
|
$
7,587
|
|
$
6,124
|
|
Income tax
expense
|
1,409
|
|
1,022
|
|
4,608
|
|
3,366
|
|
Interest expense and
income and gain on derivative
|
1,869
|
|
1,117
|
|
5,265
|
|
3,056
|
|
Loss from
discontinued operations
|
124
|
|
22
|
|
141
|
|
155
|
|
Depreciation and
amortization
|
1,337
|
|
1,398
|
|
3,969
|
|
3,708
|
|
Adjusted
EBITDA
|
$
6,934
|
|
$
5,382
|
|
$
21,570
|
|
$
16,409
|
|
|
|
|
|
|
|
|
|
Reconcilation of
GAAP net income (loss) to
|
|
|
|
|
|
|
|
|
non-GAAP net
income
|
|
|
|
|
|
|
|
|
GAAP net
income
|
$
2,195
|
|
$
1,823
|
|
$
7,587
|
|
$
6,124
|
|
Patron tax
|
746
|
|
726
|
|
2,536
|
|
2,265
|
|
Amortization of
intangibles
|
92
|
|
117
|
|
322
|
|
345
|
|
(Gain) loss on change
in fair value of derivative instruments
|
(1)
|
|
17
|
|
(2)
|
|
(120)
|
|
Stock-based
compensation
|
282
|
|
12
|
|
845
|
|
33
|
|
Litigation and other
one-time settlements
|
160
|
|
200
|
|
160
|
|
2,031
|
|
Income tax
expense
|
1,409
|
|
1,022
|
|
4,608
|
|
3,366
|
|
Acquisition
costs
|
30
|
|
-
|
|
119
|
|
131
|
|
Loss from
discontinued operations, net of income taxes
|
124
|
|
22
|
|
141
|
|
155
|
|
Non-GAAP provision
for income taxes
|
(1,664)
|
|
(1,374)
|
|
(5,415)
|
|
(5,004)
|
|
Non-GAAP net
income
|
$
3,373
|
|
$
2,565
|
|
$
10,901
|
|
$
9,326
|
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP diluted net income
|
|
|
|
|
|
|
|
|
per share to
non-GAAP diluted net income per share
|
|
|
|
|
|
|
|
|
Fully diluted
shares
|
9,647
|
|
9,731
|
|
9,871
|
|
9,717
|
|
GAAP net
income
|
$
0.23
|
|
$
0.19
|
|
$
0.77
|
|
$
0.63
|
|
Patron tax
|
0.08
|
|
0.07
|
|
0.26
|
|
0.23
|
|
Amortization of
intangibles
|
0.01
|
|
0.01
|
|
0.03
|
|
0.04
|
|
(Gain) loss on change
in fair value of derivative instruments
|
-
|
|
0.00
|
|
(0.00)
|
|
(0.01)
|
|
Stock-based
compensation
|
0.03
|
|
0.00
|
|
0.09
|
|
0.00
|
|
Litigation and other
one-time settlements
|
0.02
|
|
0.02
|
|
0.02
|
|
0.21
|
|
Income tax
expense
|
0.15
|
|
0.11
|
|
0.47
|
|
0.35
|
|
Acquisition
costs
|
0.00
|
|
-
|
|
0.01
|
|
0.01
|
|
Loss from
discontinued operations, net of income taxes
|
0.01
|
|
0.00
|
|
0.01
|
|
0.02
|
|
Non-GAAP provision
for income taxes
|
(0.17)
|
|
(0.14)
|
|
(0.55)
|
|
(0.51)
|
|
Non-GAAP diluted net
income per share
|
$
0.35
|
|
$
0.27
|
|
$
1.11
|
|
$
0.96
|
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP operating income to
|
|
|
|
|
|
|
|
|
non-GAAP operating
income
|
|
|
|
|
|
|
|
|
GAAP operating
income
|
$
5,650
|
|
$
4,037
|
|
$
17,760
|
|
$
12,860
|
|
Patron tax
|
746
|
|
726
|
|
2,536
|
|
2,265
|
|
Amortization of
intangibles
|
92
|
|
117
|
|
322
|
|
345
|
|
Stock-based
compensation
|
282
|
|
12
|
|
845
|
|
33
|
|
Litigation and other
one-time settlements
|
160
|
|
200
|
|
160
|
|
2,031
|
|
Acquisition
costs
|
30
|
|
-
|
|
134
|
|
131
|
|
Non-GAAP operating
income
|
$
6,960
|
|
$
5,092
|
|
$
21,757
|
|
$
17,665
|
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP operating margin to
|
|
|
|
|
|
|
|
|
non-GAAP operating
margin
|
|
|
|
|
|
|
|
|
GAAP operating
income
|
20.0%
|
|
16.9%
|
|
21.1%
|
|
18.0%
|
|
Patron tax
|
2.6%
|
|
3.0%
|
|
3.0%
|
|
3.2%
|
|
Amortization of
intangibles
|
0.3%
|
|
0.5%
|
|
0.4%
|
|
0.5%
|
|
Stock-based
compensation
|
1.0%
|
|
0.1%
|
|
1.0%
|
|
0.0%
|
|
Litigation and other
one-time settlements
|
0.6%
|
|
0.8%
|
|
0.2%
|
|
2.8%
|
|
Acquisition
costs
|
0.1%
|
|
0.0%
|
|
0.2%
|
|
0.2%
|
|
Non-GAAP operating
margin
|
24.6%
|
|
21.3%
|
|
25.8%
|
|
24.8%
|
|
|
|
|
|
|
|
|
* Non-GAAP Net Income. We exclude from non-GAAP net
income amortization of intangibles, patron taxes, 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.
** Non-GAAP Operating Income. We exclude from
Non-GAAP operating income amortization of intangibles, patron
taxes, 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.
*** 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 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.
Our Form 10-Q contains additional details relative to each of
the non-GAAP financial measures and is posted on our website at
www.ricksinvestor.com.
About Rick's Cabaret: Rick's Cabaret International, Inc.
(NASDAQ: RICK) is home to restaurants and upscale adult nightclubs
serving primarily businessmen and professionals that offer live
entertainment, dining and bar operations. Nightclubs in
New York City, Los Angeles, Miami, Philadelphia, Charlotte, Dallas/Ft. Worth, Houston, Minneapolis, Indianapolis and other cities operate as
"Rick's Cabaret," "XTC," "Club Onyx," "Vivid Cabaret" and
"Tootsie's Cabaret" and other brand names. Sexual contact is not
permitted at any locations. Rick's Cabaret also operates a media
division, ED Publications. Rick's Cabaret common stock is traded on
NASDAQ under the symbol RICK. For further information contact
ir@ricks.com or visit www.ricksinvestor.com. Twitter:
@rickscabaret; Facebook:
http://www.facebook.com/rickscabaretintl.
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. 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 www.ricksinvestor.com.
SOURCE Rick's Cabaret International, Inc.