HOUSTON, Aug. 5, 2021 /PRNewswire/ -- RCI Hospitality
Holdings, Inc. (Nasdaq: RICK) today reported results for the fiscal
2021 third quarter ended June 30,
2021, and filed its Form 10-Q.
Highlights 3Q21 vs 3Q20
- Record total revenues of $57.9
million compared to $14.7
million
- Record net cash from operating activities of $15.0 million and record free cash flow* of
$13.0 million
- Record Nightclubs segment revenues of $41.0 million with 44.7% operating margin
- Record Bombshells segment revenues of $16.1 million with 27.4% operating margin
- Consolidated operating margins of 32.0%
- Strong EPS of $1.37 compared to
net loss per share of $0.60
- Net income of $12.3 million and
adjusted EBITDA* of $20.4
million
- $29.1 million cash and cash
equivalents at the end of the period
Eric Langan, President and CEO, said: "Both our
Nightclubs and Bombshells segments had their best overall
performance in company history. Special thanks to our team members
for managing the influx of customers at our locations and helping
to shatter our sales records while keeping our costs in line. We
continue to press ahead with our growth initiatives. Recently we
announced an agreement to acquire 11 clubs in six states and
related real estate for $88.0 million
in stock, cash and debt. In addition, we are seeking out more
nightclub acquisitions, developing more Bombshells, and expanding
our list of potential Bombshells franchisee locations."
Conference Call Today at 5:00 PM
ET
- Live Participant Phone: Toll Free 877-545-0320, International
973-528-0016, Passcode: 417610
- Live webcast, slides or replay link:
https://www.webcaster4.com/Webcast/Page/2209/42364
- Phone replay: Toll Free 877-481-4010, International
919-882-2331, Passcode: 42364
Meet Management Tonight at 7:00 PM
ET
Investors are invited to meet management at one of RCI's top
revenue generating clubs.
- Thursday, August 5, 2021,
7:00 PM to 9:00 PM ET
- Rick's Cabaret New York, 50 W. 33rd Street, New York, NY, between Fifth Avenue and
Broadway
- RSVP your contact information to gary.fishman@anreder.com by
5:00 PM ET today
Nightclubs Segment
- 3Q21 vs 3Q20: Revenues of $41.0
million compared to $6.0
million, an increase of 582.4%. Thirty-six clubs were open
all of 3Q21 compared to the year ago quarter, when all clubs were
closed the month of April 2020, in
line with local and state pandemic regulations, and then in
May-June 2020 a limited number began
to reopen, but with restrictive curfews and occupancies. 3Q21
operating margin expanded to 44.7% from (50.5%) in 3Q20 due to
higher sales and a more favorable sales mix. As a result, segment
operating income increased to $18.4
million from a loss of $3.0
million.
- 3Q21 vs 2Q21: Revenues of $41.0
million compared to $30.8
million, an increase of 33.3%, reflecting more clubs open on
a more consistent basis, the elimination of restrictions on our
northern clubs by the beginning of June, and the ongoing return of
our loyal customer base, benefitting from increased vaccinations.
Operating margin expanded to 44.7% from 34.0% due to higher sales,
in particular, a 46.5% increase in service revenues, primarily from
northern clubs. As a result, segment operating income increased by
75.3% to $18.4 million from
$10.5 million.
Bombshells Segment
- 3Q21 vs 3Q20: Revenues of $16.1
million compared to $8.5
million, an increase of 88.5%. All 10 Bombshells were open
during all of 3Q21 compared to the year-ago quarter, when all units
were closed the month of April 2020
in line with local and state pandemic regulations and then in
May 2020 began to reopen, but with
restrictive curfews and limited occupancies. Operating margin
expanded to 27.4% from 21.7% due to higher sales. As a result,
segment operating income increased by 138.1% to $4.4 million from $1.9
million.
- 3Q21 vs 2Q21: Revenues of $16.1
million compared to $13.1
million, an increase of 22.4%, reflecting greater brand
recognition, more sports events, and increased consumer confidence.
Operating margin expanded to 27.4% from 23.9% due to higher sales.
As a result, segment operating income increased by 40.2% to
$4.4 million from $3.1 million.
Consolidated 3Q21 vs 3Q20
- Cost of goods sold declined to 15.3% of total revenues from
16.2% due to higher sales and the change in sales mix, in
particular, an increase in service revenues to 29.2% from 19.7% of
total revenues.
- Salaries and wages declined to 24.0% of revenues from 36.8%,
SG&A improved to 25.4% from 60.5%, and depreciation and
amortization decreased to 3.6% from 15.2%.
- The improvements reflected higher Nightclubs and Bombshells
sales and margins, cost-saving initiatives, and lower SG&A
expenses relative to sales as compared to the prior year.
- Operating margin was 32.0% compared to (31.6%) in 3Q20 and
22.3% in 2Q21.
- Interest expense decreased 7.2% primarily due to lower debt
balances.
- The effective tax rate was an expense of 24.4% compared to a
benefit of 20.5%.
- Debt was $127.6 million at
6/30/21 compared to $132.4 million at 3/31/21. This reflected
scheduled paydowns and a $2.0 million
paydown related to a sold property.
Note
- As of the release of this report, we do not know the future
extent and duration of the impact of COVID-19 on our businesses.
Closures and operating restrictions, as caused by local, state and
national guidelines, could lead to adverse financial results.
However, we will continually monitor and evaluate the situation and
will determine any further measures to be instituted.
- All references to the "company," "we," "our," and similar terms
include RCI Hospitality Holdings, Inc., and its subsidiaries,
unless the context indicates otherwise.
*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 (or including) some items that management believes
are not representative of the ongoing business operations of the
Company, but are included in (or excluded from) 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 calculate non-GAAP operating income and non-GAAP operating
margin by excluding the following items from income from operations
and operating margin: (a) amortization of intangibles, (b) gains or
losses on sale of businesses and assets, (c) gains or losses on
insurance, (d) impairment of assets, and (e) settlement of
lawsuits. 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 Diluted
Share. We calculate non-GAAP net income and non-GAAP net income
per diluted share by excluding or including certain items to net
income attributable to RCIHH common stockholders and diluted
earnings per share. Adjustment items are: (a) amortization of
intangibles, (b) gains or losses on sale of businesses and assets,
(c) gains or losses on insurance, (d) unrealized gains or losses on
equity securities, (e) impairment of assets, (f) settlement of
lawsuits, (g) gain on debt extinguishment, and (h) the income tax
effect of the above described adjustments. Included in the income
tax effect of the above adjustments is the net effect of the
non-GAAP provision for income taxes, calculated at 24.3% and 26.9%
effective tax rate of the pre-tax non-GAAP income before taxes for
the nine months ended June 30, 2021
and 2020, respectively, and the GAAP income tax expense (benefit).
We believe that excluding and including such items help management
and investors better understand our operating activities.
- Adjusted EBITDA. We calculate adjusted EBITDA by
excluding the following items from net income attributable to RCIHH
common stockholders: (a) depreciation and amortization, (b) income
tax expense (benefit), (c) net interest expense, (d) gains or
losses on sale of businesses and assets, (e) gains or losses on
insurance, (f) unrealized gains or losses on equity securities, (g)
impairment of assets, (h) settlement of lawsuits, and (i) gain on
debt extinguishment. We believe that adjusting for such items helps
management and investors better understand our 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. 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.
- Management also uses non-GAAP cash flow measures such as
free cash flow. Free cash flow is derived from net cash
provided by operating activities less maintenance capital
expenditures. We use free cash flow as the baseline for the
implementation of our capital allocation strategy.
About RCI Hospitality Holdings, Inc. (Nasdaq: RICK)
With more than 40 units, RCI Hospitality Holdings, Inc., through
its subsidiaries, is the country's leading company in gentlemen's
clubs and sports bars/restaurants. Clubs in New York City, Chicago, Dallas/Ft.
Worth, Houston,
Miami, Minneapolis, St.
Louis, Charlotte, Pittsburgh, and other markets operate under
brand names such as Rick's Cabaret, XTC, Club Onyx, Vivid Cabaret,
Jaguars Club, Tootsie's Cabaret, and Scarlett's Cabaret. Sports
bars/restaurants operate under the brand name Bombshells Restaurant
& Bar. 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, 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) the impact of the COVID-19
pandemic, and (vii) numerous other factors such as laws governing
the operation of adult entertainment businesses, competition and
dependence on key personnel. For more detailed discussion of such
factors and certain risks and uncertainties, see RCI's annual
report on Form 10-K for the year ended September 30, 2020, as well as its other filings
with the U.S. Securities and Exchange Commission. 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
RCI HOSPITALITY
HOLDINGS, INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(in thousands, except
per share and percentage data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended June 30,
|
|
For the Nine
Months Ended June 30,
|
|
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
Amount
|
|
% of
Revenue
|
|
Amount
|
|
% of
Revenue
|
|
Amount
|
|
% of
Revenue
|
|
Amount
|
|
% of
Revenue
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of alcoholic
beverages
|
$
25,092
|
|
43.4%
|
|
$
7,623
|
|
51.8%
|
|
$
62,725
|
|
44.7%
|
|
$
45,285
|
|
43.7%
|
|
Sales of food and
merchandise
|
12,058
|
|
20.8%
|
|
3,452
|
|
23.4%
|
|
30,205
|
|
21.5%
|
|
17,378
|
|
16.8%
|
|
Service
revenues
|
16,880
|
|
29.2%
|
|
2,907
|
|
19.7%
|
|
38,442
|
|
27.4%
|
|
34,448
|
|
33.3%
|
|
Other
|
3,830
|
|
6.6%
|
|
739
|
|
5.0%
|
|
8,945
|
|
6.4%
|
|
6,430
|
|
6.2%
|
|
|
Total
revenues
|
57,860
|
|
100.0%
|
|
14,721
|
|
100.0%
|
|
140,317
|
|
100.0%
|
|
103,541
|
|
100.0%
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Alcoholic beverages
sold
|
4,621
|
|
18.4%
|
|
1,245
|
|
16.3%
|
|
11,613
|
|
18.5%
|
|
8,826
|
|
19.5%
|
|
|
Food and merchandise
sold
|
4,043
|
|
33.5%
|
|
1,128
|
|
32.7%
|
|
9,961
|
|
33.0%
|
|
5,974
|
|
34.4%
|
|
|
Service and
other
|
208
|
|
1.0%
|
|
17
|
|
0.5%
|
|
304
|
|
0.6%
|
|
148
|
|
0.4%
|
|
|
|
Total cost of goods
sold (exclusive of items shown below)
|
8,872
|
|
15.3%
|
|
2,390
|
|
16.2%
|
|
21,878
|
|
15.6%
|
|
14,948
|
|
14.4%
|
|
Salaries and
wages
|
13,870
|
|
24.0%
|
|
5,421
|
|
36.8%
|
|
36,556
|
|
26.1%
|
|
30,866
|
|
29.8%
|
|
Selling, general and
administrative
|
14,697
|
|
25.4%
|
|
8,908
|
|
60.5%
|
|
39,467
|
|
28.1%
|
|
39,889
|
|
38.5%
|
|
Depreciation and
amortization
|
2,057
|
|
3.6%
|
|
2,235
|
|
15.2%
|
|
6,197
|
|
4.4%
|
|
6,696
|
|
6.5%
|
|
Other charges,
net
|
(143)
|
|
-0.2%
|
|
424
|
|
2.9%
|
|
1,288
|
|
0.9%
|
|
8,588
|
|
8.3%
|
|
|
Total operating
expenses
|
39,353
|
|
68.0%
|
|
19,378
|
|
131.6%
|
|
105,386
|
|
75.1%
|
|
100,987
|
|
97.5%
|
Income (loss) from
operations
|
18,507
|
|
32.0%
|
|
(4,657)
|
|
-31.6%
|
|
34,931
|
|
24.9%
|
|
2,554
|
|
2.5%
|
Other income
(expenses)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
(2,281)
|
|
-3.9%
|
|
(2,459)
|
|
-16.7%
|
|
(7,079)
|
|
-5.0%
|
|
(7,403)
|
|
-7.1%
|
|
Interest
income
|
72
|
|
0.1%
|
|
80
|
|
0.5%
|
|
194
|
|
0.1%
|
|
263
|
|
0.3%
|
|
Non-operating gains
(losses), net
|
9
|
|
0.0%
|
|
31
|
|
0.2%
|
|
5,356
|
|
3.8%
|
|
(103)
|
|
-0.1%
|
Income (loss) before
income taxes
|
16,307
|
|
28.2%
|
|
(7,005)
|
|
-47.6%
|
|
33,402
|
|
23.8%
|
|
(4,689)
|
|
-4.5%
|
Income tax expense
(benefit)
|
3,986
|
|
6.9%
|
|
(1,437)
|
|
-9.8%
|
|
5,540
|
|
3.9%
|
|
(1,262)
|
|
-1.2%
|
Net income
(loss)
|
12,321
|
|
21.3%
|
|
(5,568)
|
|
-37.8%
|
|
27,862
|
|
19.9%
|
|
(3,427)
|
|
-3.3%
|
Net loss attributable
to noncontrolling interests
|
(19)
|
|
0.0%
|
|
94
|
|
0.6%
|
|
174
|
|
0.1%
|
|
135
|
|
0.1%
|
Net income (loss)
attributable to RCIHH common shareholders
|
$
12,302
|
|
21.3%
|
|
$ (5,474)
|
|
-37.2%
|
|
$
28,036
|
|
20.0%
|
|
$
(3,292)
|
|
-3.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
$
1.37
|
|
|
|
$
(0.60)
|
|
|
|
$
3.11
|
|
|
|
$
(0.36)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
9,000
|
|
|
|
9,125
|
|
|
|
9,006
|
|
|
|
9,224
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends per
share
|
$
0.04
|
|
|
|
$
0.03
|
|
|
|
$
0.12
|
|
|
|
$
0.10
|
|
|
RCI HOSPITALITY
HOLDINGS, INC.
|
NON-GAAP FINANCIAL
MEASURES
|
(in thousands, except
per share and percentage data)
|
|
|
|
|
|
|
|
|
|
For the Three
Months
|
|
For the Nine
Months
|
|
Ended June
30,
|
|
Ended June
30,
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
Reconciliation of
GAAP net income (loss) to Adjusted EBITDA
|
|
|
|
|
|
|
|
Net income (loss)
attributable to RCIHH common stockholders
|
$
12,302
|
|
$ (5,474)
|
|
$
28,036
|
|
$
(3,292)
|
Income tax expense
(benefit)
|
3,986
|
|
(1,437)
|
|
5,540
|
|
(1,262)
|
Interest expense,
net
|
2,209
|
|
2,379
|
|
6,885
|
|
7,140
|
Settlement of
lawsuits
|
127
|
|
50
|
|
280
|
|
74
|
Impairment of
assets
|
271
|
|
982
|
|
1,672
|
|
9,192
|
Gain on sale of
businesses and assets
|
(541)
|
|
(608)
|
|
(455)
|
|
(645)
|
Gain on debt
extinguishment
|
-
|
|
-
|
|
(5,329)
|
|
-
|
Unrealized loss
(gain) on equity securities
|
(9)
|
|
(31)
|
|
58
|
|
103
|
Gain on
insurance
|
-
|
|
-
|
|
(209)
|
|
(33)
|
Depreciation and
amortization
|
2,057
|
|
2,235
|
|
6,197
|
|
6,696
|
Adjusted
EBITDA
|
$
20,402
|
|
$ (1,904)
|
|
$
42,675
|
|
$
17,973
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP net income (loss) to non-GAAP net income
|
|
|
|
|
|
|
|
Net income (loss)
attributable to RCIHH common stockholders
|
$
12,302
|
|
$ (5,474)
|
|
$
28,036
|
|
$
(3,292)
|
Amortization of
intangibles
|
51
|
|
149
|
|
209
|
|
462
|
Settlement of
lawsuits
|
127
|
|
50
|
|
280
|
|
74
|
Impairment of
assets
|
271
|
|
982
|
|
1,672
|
|
9,192
|
Gain on sale of
businesses and assets
|
(541)
|
|
(608)
|
|
(455)
|
|
(645)
|
Gain on debt
extinguishment
|
-
|
|
-
|
|
(5,329)
|
|
-
|
Unrealized loss
(gain) on equity securities
|
(9)
|
|
(31)
|
|
58
|
|
103
|
Gain on
insurance
|
-
|
|
-
|
|
(209)
|
|
(33)
|
Net income tax
effect
|
39
|
|
(1,840)
|
|
(1,702)
|
|
(2,499)
|
Non-GAAP net
income
|
$
12,240
|
|
$ (6,772)
|
|
$
22,560
|
|
$
3,362
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP diluted earnings (loss) per share to non-GAAP diluted earnings
per share
|
|
|
Diluted
shares
|
9,000
|
|
9,125
|
|
9,006
|
|
9,224
|
GAAP diluted earnings
(loss) per share
|
$
1.37
|
|
$
(0.60)
|
|
$
3.11
|
|
$
(0.36)
|
Amortization of
intangibles
|
0.01
|
|
0.02
|
|
0.02
|
|
0.05
|
Settlement of
lawsuits
|
0.01
|
|
0.01
|
|
0.03
|
|
0.01
|
Impairment of
assets
|
0.03
|
|
0.11
|
|
0.19
|
|
1.00
|
Gain on sale of
businesses and assets
|
(0.06)
|
|
(0.07)
|
|
(0.05)
|
|
(0.07)
|
Gain on debt
extinguishment
|
-
|
|
-
|
|
(0.59)
|
|
-
|
Unrealized loss
(gain) on equity securities
|
(0.00)
|
|
(0.00)
|
|
0.01
|
|
0.01
|
Gain on
insurance
|
-
|
|
-
|
|
(0.02)
|
|
(0.00)
|
Net income tax
effect
|
0.00
|
|
(0.20)
|
|
(0.19)
|
|
(0.27)
|
Non-GAAP diluted
earnings per share
|
$
1.36
|
|
$
(0.74)
|
|
$
2.50
|
|
$
0.36
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP operating income to non-GAAP operating income
|
|
|
|
|
|
|
Income (loss) from
operations
|
$
18,507
|
|
$ (4,657)
|
|
$
34,931
|
|
$
2,554
|
Amortization of
intangibles
|
51
|
|
149
|
|
209
|
|
462
|
Settlement of
lawsuits
|
127
|
|
50
|
|
280
|
|
74
|
Impairment of
assets
|
271
|
|
982
|
|
1,672
|
|
9,192
|
Gain on sale of
businesses and assets
|
(541)
|
|
(608)
|
|
(455)
|
|
(645)
|
Gain on
insurance
|
-
|
|
-
|
|
(209)
|
|
(33)
|
Non-GAAP operating
income
|
$
18,415
|
|
$ (4,084)
|
|
$
36,428
|
|
$
11,604
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP operating margin to non-GAAP operating margin
|
|
|
|
|
|
|
GAAP operating
margin
|
32.0%
|
|
-31.6%
|
|
24.9%
|
|
2.5%
|
Amortization of
intangibles
|
0.1%
|
|
1.0%
|
|
0.1%
|
|
0.4%
|
Settlement of
lawsuits
|
0.2%
|
|
0.3%
|
|
0.2%
|
|
0.1%
|
Impairment of
assets
|
0.5%
|
|
6.7%
|
|
1.2%
|
|
8.9%
|
Gain on sale of
businesses and assets
|
-0.9%
|
|
-4.1%
|
|
-0.3%
|
|
-0.6%
|
Gain on
insurance
|
0.0%
|
|
0.0%
|
|
-0.1%
|
|
0.0%
|
Non-GAAP operating
margin
|
31.8%
|
|
-27.7%
|
|
26.0%
|
|
11.2%
|
|
|
|
|
|
|
|
|
Reconciliation of
net cash provided by operating activities to free cash
flow
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
$
14,971
|
|
$
166
|
|
$
32,217
|
|
$
12,147
|
Less: Maintenance
capital expenditures
|
2,017
|
|
-
|
|
4,608
|
|
2,111
|
Free cash
flow
|
$
12,954
|
|
$
166
|
|
$
27,609
|
|
$
10,036
|
RCI HOSPITALITY
HOLDINGS, INC.
|
SEGMENT
INFORMATION
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months
|
|
For the Nine
Months
|
|
|
Ended June
30,
|
|
Ended June
30,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
Revenues
|
|
|
|
|
|
|
|
|
Nightclubs
|
$
41,031
|
|
$
6,013
|
|
$
97,015
|
|
$
75,239
|
|
Bombshells
|
16,077
|
|
8,531
|
|
42,218
|
|
27,684
|
|
Other
|
752
|
|
177
|
|
1,084
|
|
618
|
|
|
$
57,860
|
|
$
14,721
|
|
$
140,317
|
|
$
103,541
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
|
|
|
|
|
|
|
Nightclubs
|
$
18,350
|
|
$
(3,038)
|
|
$
37,313
|
|
$
13,002
|
|
Bombshells
|
4,404
|
|
1,850
|
|
10,263
|
|
4,109
|
|
Other
|
321
|
|
(92)
|
|
107
|
|
(423)
|
|
General
corporate
|
(4,568)
|
|
(3,377)
|
|
(12,752)
|
|
(14,134)
|
|
|
$
18,507
|
|
$
(4,657)
|
|
$
34,931
|
|
$
2,554
|
RCI HOSPITALITY
HOLDINGS, INC.
|
NON-GAAP SEGMENT
INFORMATION
|
($ in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended June 30, 2021
|
|
For the Three
Months Ended June 30, 2020
|
|
Nightclubs
|
|
Bombshells
|
|
Other
|
|
Corporate
|
|
Total
|
|
Nightclubs
|
|
Bombshells
|
|
Other
|
|
Corporate
|
|
Total
|
Income (loss) from
operations
|
$
18,350
|
|
$
4,404
|
|
$
321
|
|
$
(4,568)
|
|
$
18,507
|
|
$
(3,038)
|
|
$
1,850
|
|
$
(92)
|
|
$
(3,377)
|
|
$
(4,657)
|
Amortization of
intangibles
|
47
|
|
4
|
|
-
|
|
-
|
|
51
|
|
49
|
|
3
|
|
96
|
|
-
|
|
148
|
Settlement of
lawsuits
|
123
|
|
4
|
|
-
|
|
-
|
|
127
|
|
50
|
|
-
|
|
-
|
|
-
|
|
50
|
Impairment of
assets
|
271
|
|
-
|
|
-
|
|
-
|
|
271
|
|
982
|
|
-
|
|
-
|
|
-
|
|
982
|
Loss (gain) on sale
of businesses and assets
|
(512)
|
|
9
|
|
-
|
|
(38)
|
|
(541)
|
|
(619)
|
|
16
|
|
-
|
|
(4)
|
|
(607)
|
Gain on
insurance
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Non-GAAP operating
income (loss)
|
$
18,279
|
|
$
4,421
|
|
$
321
|
|
$
(4,606)
|
|
$
18,415
|
|
$
(2,576)
|
|
$
1,869
|
|
$
4
|
|
$
(3,381)
|
|
$
(4,084)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
margin
|
44.7%
|
|
27.4%
|
|
42.7%
|
|
-7.9%
|
|
32.0%
|
|
-50.5%
|
|
21.7%
|
|
-52.0%
|
|
-22.9%
|
|
-31.6%
|
Non-GAAP operating
margin
|
44.5%
|
|
27.5%
|
|
42.7%
|
|
-8.0%
|
|
31.8%
|
|
-42.8%
|
|
21.9%
|
|
2.3%
|
|
-23.0%
|
|
-27.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Nine
Months Ended June 30, 2021
|
|
For the Nine
Months Ended June 30, 2020
|
|
Nightclubs
|
|
Bombshells
|
|
Other
|
|
Corporate
|
|
Total
|
|
Nightclubs
|
|
Bombshells
|
|
Other
|
|
Corporate
|
|
Total
|
Income (loss) from
operations
|
$
37,313
|
|
$
10,263
|
|
$
107
|
|
$ (12,752)
|
|
$
34,931
|
|
$
13,002
|
|
$
4,109
|
|
$ (423)
|
|
$ (14,134)
|
|
$
2,554
|
Amortization of
intangibles
|
141
|
|
11
|
|
57
|
|
-
|
|
209
|
|
163
|
|
11
|
|
287
|
|
-
|
|
461
|
Settlement of
lawsuits
|
237
|
|
38
|
|
5
|
|
-
|
|
280
|
|
74
|
|
-
|
|
-
|
|
-
|
|
74
|
Impairment of
assets
|
1,672
|
|
-
|
|
-
|
|
-
|
|
1,672
|
|
8,947
|
|
245
|
|
-
|
|
-
|
|
9,192
|
Loss (gain) on sale
of businesses and assets
|
(498)
|
|
56
|
|
-
|
|
(13)
|
|
(455)
|
|
(619)
|
|
16
|
|
-
|
|
(41)
|
|
(644)
|
Gain on
insurance
|
(165)
|
|
-
|
|
-
|
|
(44)
|
|
(209)
|
|
(20)
|
|
-
|
|
-
|
|
(13)
|
|
(33)
|
Non-GAAP operating
income (loss)
|
$
38,700
|
|
$
10,368
|
|
$
169
|
|
$ (12,809)
|
|
$
36,428
|
|
$
21,547
|
|
$
4,381
|
|
$ (136)
|
|
$ (14,188)
|
|
$
11,604
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
margin
|
38.5%
|
|
24.3%
|
|
9.9%
|
|
-9.1%
|
|
24.9%
|
|
17.3%
|
|
14.8%
|
|
-68.4%
|
|
-13.7%
|
|
2.5%
|
Non-GAAP operating
margin
|
39.9%
|
|
24.6%
|
|
15.6%
|
|
-9.1%
|
|
26.0%
|
|
28.6%
|
|
15.8%
|
|
-22.0%
|
|
-13.7%
|
|
11.2%
|
RCI HOSPITALITY
HOLDINGS, INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
For the Nine
Months Ended
|
|
|
|
June 30,
2021
|
|
June 30,
2020
|
|
June 30,
2021
|
|
June 30,
2020
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
12,321
|
|
$
(5,568)
|
|
$
27,862
|
|
$
(3,427)
|
Adjustments to
reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
2,057
|
|
2,235
|
|
6,197
|
|
6,696
|
|
Deferred income tax
benefit
|
(430)
|
|
(362)
|
|
(430)
|
|
(1,517)
|
|
Gain on sale of
businesses and assets
|
(712)
|
|
(713)
|
|
(626)
|
|
(749)
|
|
Impairment of
assets
|
271
|
|
982
|
|
1,672
|
|
9,192
|
|
Unrealized loss
(gain) on equity securities
|
(9)
|
|
(31)
|
|
58
|
|
103
|
|
Amortization of debt
discount and issuance costs
|
59
|
|
65
|
|
160
|
|
194
|
|
Gain on debt
extinguishment
|
-
|
|
-
|
|
(5,298)
|
|
-
|
|
Noncash lease
expense
|
434
|
|
419
|
|
1,282
|
|
1,244
|
|
Gain on
insurance
|
-
|
|
-
|
|
(294)
|
|
(33)
|
|
Doubtful accounts
expense (reversal) on notes receivable
|
36
|
|
495
|
|
(22)
|
|
495
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
1,172
|
|
(1,970)
|
|
4,309
|
|
(53)
|
|
|
Inventories
|
(76)
|
|
108
|
|
(107)
|
|
(29)
|
|
|
Prepaid expenses,
other current assets and other assets
|
852
|
|
2,102
|
|
2,346
|
|
4,942
|
|
|
Accounts payable,
accrued and other liabilities
|
(1,004)
|
|
2,404
|
|
(4,892)
|
|
(4,911)
|
|
Net cash provided by
operating activities
|
14,971
|
|
166
|
|
32,217
|
|
12,147
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
Proceeds from sale of
businesses and assets
|
3,205
|
|
1,936
|
|
3,213
|
|
2,041
|
Proceeds from
insurance
|
-
|
|
-
|
|
294
|
|
945
|
Proceeds from notes
receivable
|
34
|
|
1,152
|
|
95
|
|
1,555
|
Payments for property
and equipment and intangible assets
|
(4,070)
|
|
(242)
|
|
(10,788)
|
|
(5,565)
|
|
Net cash provided by
(used in) investing activities
|
(831)
|
|
2,846
|
|
(7,186)
|
|
(1,024)
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
Proceeds from debt
obligations
|
-
|
|
5,623
|
|
2,176
|
|
6,503
|
Payments on debt
obligations
|
(4,868)
|
|
(3,392)
|
|
(10,845)
|
|
(7,489)
|
Purchase of treasury
stock
|
-
|
|
-
|
|
(1,794)
|
|
(8,488)
|
Payment of
dividends
|
(360)
|
|
(273)
|
|
(1,080)
|
|
(920)
|
Payment of loan
origination costs
|
-
|
|
-
|
|
(25)
|
|
-
|
Distribution to
noncontrolling interests
|
-
|
|
-
|
|
-
|
|
(31)
|
|
Net cash provided by
(used in) financing activities
|
(5,228)
|
|
1,958
|
|
(11,568)
|
|
(10,425)
|
NET INCREASE IN CASH
AND CASH EQUIVALENTS
|
8,912
|
|
4,970
|
|
13,463
|
|
698
|
CASH AND CASH
EQUIVALENTS AT BEGINNING OF PERIOD
|
20,156
|
|
9,825
|
|
15,605
|
|
14,097
|
CASH AND CASH
EQUIVALENTS AT END OF PERIOD
|
$
29,068
|
|
$
14,795
|
|
$
29,068
|
|
$
14,795
|
RCI HOSPITALITY
HOLDINGS, INC.
|
CONSOLIDATED
BALANCE SHEETS
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
September
30,
|
|
June
30,
|
|
|
|
|
2021
|
|
2020
|
|
2020
|
ASSETS
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
29,068
|
|
$
15,605
|
|
$
14,795
|
|
Accounts receivable,
net
|
2,458
|
|
6,767
|
|
6,648
|
|
Current portion of
notes receivable
|
217
|
|
201
|
|
219
|
|
Inventories
|
2,479
|
|
2,372
|
|
2,627
|
|
Prepaid expenses and
other current assets
|
4,062
|
|
6,488
|
|
3,167
|
|
Assets held for
sale
|
4,887
|
|
-
|
|
2,013
|
|
|
Total current
assets
|
43,171
|
|
31,433
|
|
29,469
|
Property and
equipment, net
|
178,087
|
|
181,383
|
|
181,960
|
Operating lease
right-of-use assets, net
|
24,481
|
|
25,546
|
|
25,962
|
Notes receivable, net
of current portion
|
2,819
|
|
2,908
|
|
2,896
|
Goodwill
|
45,440
|
|
45,686
|
|
47,109
|
Intangibles,
net
|
73,019
|
|
73,077
|
|
73,224
|
Other
assets
|
922
|
|
900
|
|
873
|
|
|
|
Total
assets
|
$
367,939
|
|
$
360,933
|
|
$
361,493
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
Accounts
payable
|
$
4,909
|
|
$
4,799
|
|
$
3,955
|
|
Accrued
liabilities
|
11,738
|
|
14,573
|
|
10,286
|
|
Current portion of
long-term debt, net
|
13,695
|
|
16,304
|
|
17,249
|
|
Current portion of
operating lease liabilities
|
1,720
|
|
1,628
|
|
1,586
|
|
|
Total current
liabilities
|
32,062
|
|
37,304
|
|
33,076
|
Deferred tax
liability, net
|
19,960
|
|
20,390
|
|
20,141
|
Long-term debt, net
of current portion and debt discount and issuance costs
|
113,908
|
|
125,131
|
|
125,487
|
Operating lease
liabilities, net of current portion
|
24,360
|
|
25,439
|
|
25,863
|
Other long-term
liabilities
|
354
|
|
362
|
|
372
|
|
|
Total
liabilities
|
190,644
|
|
208,626
|
|
204,939
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
Preferred
stock
|
-
|
|
-
|
|
-
|
|
Common
stock
|
90
|
|
91
|
|
91
|
|
Additional paid-in
capital
|
50,040
|
|
51,833
|
|
52,829
|
|
Retained
earnings
|
127,753
|
|
100,797
|
|
103,956
|
|
|
Total RCIHH
stockholders' equity
|
177,883
|
|
152,721
|
|
156,876
|
|
Noncontrolling
interests
|
(588)
|
|
(414)
|
|
(322)
|
|
|
Total
equity
|
177,295
|
|
152,307
|
|
156,554
|
|
|
|
Total liabilities and
equity
|
$
367,939
|
|
$
360,933
|
|
$
361,493
|
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SOURCE RCI Hospitality Holdings, Inc.