HOUSTON, April 9, 2020 /PRNewswire/ -- RCI
Hospitality Holdings, Inc. (Nasdaq: RICK) today announced sales for
its Nightclubs and Bombshells restaurants for the Fiscal 2020
second quarter ended March 31, 2020.
The company also provided an update regarding its response to the
coronavirus situation.
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Eric Langan, President & CEO,
said, "Total and same-store sales were up 11.8% and 5.3%,
respectively, through the first 10 weeks of 2Q20 until mid-March,
when concern about COVID-19 caused declines at our club and
restaurant subsidiaries. Following state and local mandates
regarding bars and restaurants, our subsidiaries closed all
locations in the third week of March to protect guests, staff,
entertainers, and our communities. As a result, we are no longer
operating at our earlier FY20 $30
million free cash flow run rate and will provide an update
later this year. However, due to strong sales during the first 10
weeks of 2Q20 and our subsidiaries' ability to begin reducing
costs, we believe we ended March with sufficient working capital on
hand to fund operations into July without additional
borrowings."
COVID-19 Update
Starting mid-March, RCI and its subsidiaries have focused on
implementing significant cost-savings and other measures such as:
(i) furloughing more than 1,900 employees; (ii) reducing pay of the
approximately 100 remaining employees to 75% of previous levels
with plans to drop to 50% should closings last through the end of
May; (iii) obtaining three-month payment deferrals from both of our
major lenders and deferral agreements with others and some of our
landlords in the small number of locations where subsidiaries pay
rent; (iv) reducing or eliminating nearly all areas of
discretionary spending; and (v) filing for business interruption
insurance claims.
"We plan to be ready to reopen all locations as soon as possible
when allowed to do so," Mr. Langan said. "We want to thank our
vendors, partners, bankers, and professional relationships for
their understanding and working with us during these unprecedented
times."
Sales Data*
($ in
millions)
|
2Q20
(13
weeks)
|
2Q19
(13
Weeks)
|
Change
|
2Q20
1st 10
Weeks
|
2Q19
1st 10 Weeks
|
Change
|
Total club and
restaurant sales
|
$39.8
|
$44.1
|
-9.8%
|
$36.7
|
$32.9
|
11.8%
|
Consolidated
same-store sales
|
$36.1
|
$42.3
|
-14.7%
|
$33.4
|
$31.7
|
5.3%
|
Nightclubs total
sales
38 vs. 39
units
|
$31.0
|
$36.6
|
-15.3%
|
$28.8
|
$27.4
|
5.0%
|
Nightclubs same-store
sales
|
$31.0
|
$36.4
|
-14.8%
|
$28.8
|
$27.2
|
5.6%
|
Bombshells total
sales
10 vs. 7
units
|
$8.8
|
$7.5
|
17.0%
|
$8.0
|
$5.5
|
45.4%
|
Bombshells same-store
sales
|
$5.1
|
$5.9
|
-13.8%
|
$4.6
|
$4.5
|
3.6%
|
* Current and
historical Nightclubs and Bombshells sales data do not include
non-core operations
|
Nightclubs
Nightclubs total sales for the quarter declined 15.3% compared
to a year ago because of COVID-19 related closures the second half
of March 2020. Same-store sales
decreased 14.8%. Same-store sales included two clubs in
Chicago and Pittsburgh (acquired November 2018) for the first time. Nightclubs
total sales for the first 10 weeks of the quarter increased 5.0%
compared to the comparable year-ago period. Adjusted 10-week
same-store sales increased 5.6%. Sales during the first 10 weeks of
2Q20 benefitted from a strong sports lineup in January and
February, including the professional football championship in
South Florida and professional
basketball mid-season event in Chicago, as well as improved weather in
January compared to the polar vortex a year ago.
Bombshells
Bombshells total sales for the quarter increased 17.0% compared
to a year ago and same-store sales decreased 13.8%. Sales reflected
the success of new units, continued same-store rebound for most of
the quarter, and then the COVID-19 related closures. Same-store
sales included a Bombshells in the Houston suburb Pearland (opened April
2018) for the first time. The four new Bombshells, all in
the Houston area, were I-10
(opened December 2018), Tomball (March
2019), Katy (October 2019),
and US 59 (January 30, 2020).
Bombshells total sales for the first 10 weeks of the quarter
increased 45.4% compared to the corresponding year-ago period.
Adjusted 10-week same-store sales increased 3.6%.
Next update
We anticipate filing our 10-Q and reporting results for 2Q20 in
mid-May.
Notes
- Current and historical Nightclubs and Bombshells sales data in
quarterly sales news releases do not include revenues from non-core
operations.
- Sales numbers are preliminary and subject to final
closing.
- Unit counts are at period end.
- All references to the "company," "we," "our," and similar terms
include RCI Hospitality Holdings, Inc. and its subsidiaries, unless
the context indicates otherwise.
- Planned opening dates are subject to change due to weather,
which could affect construction schedules, and scheduling of final
municipal inspections.
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, but not limited to, the risks and
uncertainties associated with (i) operating and managing an adult
business, (ii) the business climates in cities where it operates,
(iii) the success or lack thereof in launching and building the
company's businesses, (iv) cyber security, (v) conditions relevant
to real estate transactions, (vi) our ability to maintain
compliance with the filing requirements of the SEC and the Nasdaq
Stock Market, (vii) the impact of the coronavirus pandemic, and
(viii) 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.
Media & Investor Contacts
Gary Fishman and Steven Anreder at 212-532-3232 or
gary.fishman@anreder.com and steven.anreder@anreder.com
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SOURCE RCI Hospitality Holdings, Inc.