First Company to Use Twitter Spaces for
Earnings Call – Today at 4:30 PM
ET
HOUSTON, May 9, 2022
/PRNewswire/ -- RCI Hospitality Holdings, Inc. (Nasdaq: RICK) today
reported results and filed its Form 10-Q for the fiscal 2022 second
quarter and six months ended March 31,
2022.
Summary Financials
|
2Q22
|
|
Change YoY
|
|
6M22
|
|
Change YoY
|
|
Total Revenues
|
$63.7M
|
|
+44.6%
|
|
$125.5M
|
|
+52.2%
|
|
EPS
|
$1.15
|
|
+69.1%
|
|
$2.28
|
|
+30.3%
|
|
Non-GAAP EPS*
|
$1.19
|
|
+58.0%
|
|
$2.29
|
|
+100.1%
|
|
Net Cash from Operating
Activities
|
$11.6M
|
|
+5.7%
|
|
$27.9M
|
|
+61.6%
|
|
Free Cash Flow*
|
$11.1M
|
|
+23.3%
|
|
$26.3M
|
|
+79.8%
|
|
Net Income Attributable to RCIHH Common
Stockholders
|
$11.0M
|
|
+79.8%
|
|
$21.5M
|
|
+36.8%
|
|
Adjusted EBITDA*
|
$19.9M
|
|
+46.8%
|
|
$37.9M
|
|
+70.2%
|
|
Diluted Shares
|
9.489M
|
|
+5.4%
|
|
9.448M
|
|
+4.9%
|
|
*See "Non-GAAP Financial Measures" below.
Eric Langan, President and CEO
of RCI Hospitality Holdings, Inc., stated: "We had an
outstanding quarter across the board. We ended the quarter with
$38.1 million in cash, and favorable
trends are continuing, with total revenues in April exceeding
March. Thanks to all our teams for making all of this
possible."
Expansion efforts are moving ahead. This includes
continuing to improve the performance of clubs acquired in 1Q22,
acquiring new ones, harnessing new technology to drive club
traffic, and expanding Bombshells. Recent developments:
Nightclubs
- South Florida club acquired
last week
- Fort Worth club under contract
to buy
- New Rick's Steakhouse & Lounge opened in Miami
- Reformatted club opening soon in San
Antonio
- AdmireMe.com social media fan site in full beta
- Tip-N-Strip non-fungible token (NFT) guest benefits program on
track to mint in June
Bombshells
- Property acquired for a 12th Bombshells (Houston)
- Two other locations (Dallas
and Lubbock, TX) under contract to
buy
- Bombshells' first franchisee expected to open its first
location in San Antonio this
quarter
- Bombshells' second franchisee (announced last week) planning
its first location for Huntsville,
Alabama
Conference Call Today at 4:30 PM
ET
Participants need to use Twitter Spaces on their mobile phones
to ask questions during the Q&A
Twitter
|
Telephone
|
Webcast
|
- To participate in
the RCI 2Q22
Earnings Call Twitter Space, follow
@RicksCEO and go to this
link:
https://twitter.com/i/spaces/1mrGmanekZQGy
|
- Live: Toll Free
888-506-0062, Intl. 973-
528-0011, Passcode: 384318
- Replay: Toll Free
877-481-4010, Intl.
919-882-2331, Passcode: 45285
|
- Live webcast,
slides & replay:
https://www.webcaster4.com/Webcast/Page/2209/45285
|
Meet Management Tonight at 8:00 PM
ET
- Investors are invited to meet management at RCI's top revenue
generating club
- Tootsie's Cabaret Miami, 150 NW 183rd St., Miami, FL 33169
- To be on the guest list, RSVP your contact information to
gary.fishman@anreder.com by 5:00 PM
ET today
2Q22 Segments
Nightclubs
- Revenues of $48.2 million
increased by 56.5% compared to the prior-year quarter, when
COVID-19 related government restrictions were just starting to
ease.
- Newly acquired clubs contributed 50% of the $17.4 million increase in segment revenues.
Same-store sales growth contributed 20%, and eight northern clubs
(not open enough days in 2Q21 to qualify for same-store sales)
contributed 30%.
- Operating margin was 39.7% vs. 34.0% in 2Q21 and 39.5% vs.
38.8% non-GAAP. Operating margin expanded primarily due to an 88%
year-over-year increase in high-margin service revenues.
Bombshells
- Revenues of $15.3 million
increased by 16.7% compared to the prior-year quarter.
- Bombshells Arlington, which
opened in December, contributed 85% of the $2.2 million segment revenue increase. Same-store
sales growth contributed 14%.
- Operating margin was 22.6% vs. 23.9% in the year ago quarter
and 19.0% in the previous quarter, which was negatively affected by
Arlington's pre-opening costs
without the benefit of a full quarter of sales.
2Q22 Consolidated
Comparisons are to 2Q21 and % are of total revenues unless
indicated otherwise
- Cost of goods sold improved (13.8% vs. 15.4%), reflecting the
increase in sales mix of higher-margin service revenues (33.8% vs.
26.1%).
- Salaries and wages (26.0% vs. 25.4%) and SG&A (28.9% vs.
28.6%) were approximately level, reflecting new employees from new
units and increased variable expenses related to sales in
2Q22.
- Operating margin was 26.8% vs. 22.3% and 26.9% vs. 25.9%
non-GAAP.
- Interest expense increased $500,000 primarily due to higher debt related to
the 1Q22 acquisitions, but declined to 4.5% from 5.4% of
revenues.
- Income tax expense was $3.4
million compared to $1.9
million. The effective tax rate was 23.4% vs. 24.3%.
- Weighted average shares outstanding increased 5.4% due to
shares issued for clubs acquired in 1Q22.
- 83,343 shares were bought back in the open market 2Q22 and 3Q22
through May 6, 2022, for $5.2 million, or an average of $62.37 per share.
- Debt was $178.1 million at
3/31/22 compared to $161.9 million at 12/31/21. The increase
primarily reflected the January 2022
bank loan secured by real estate, most of which was acquired for
cash in acquisitions.
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. We will
continually monitor and evaluate our cash flow situation to
determine whether any measures need 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, and (d) 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) impairment of assets, (c) gains or losses on sale
of businesses and assets, (d) gains or losses on insurance, (e)
unrealized gains or losses on equity securities, (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 21.8% and 24.2%
effective tax rate of the pre-tax non-GAAP income before taxes for
the six months ended March 31, 2022
and 2021, 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)
www.rcihospitality.com
With more than 50 units, RCI
Hospitality Holdings, Inc., through its subsidiaries, is the
country's leading company in adult nightclubs and sports
bars/restaurants. Clubs in New York City, Chicago, Dallas-Fort
Worth, Houston, Miami, Minneapolis, Denver, St. Louis, Charlotte,
Pittsburgh, Raleigh, Louisville, 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.
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,
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,
2021, 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 INCOME
|
(in thousands, except
per share, number of shares and percentage data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended March 31,
|
|
For the Six Months
Ended March 31,
|
|
|
|
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
|
|
|
|
Amount
|
|
% of
Revenue
|
|
Amount
|
|
% of
Revenue
|
|
Amount
|
|
% of
Revenue
|
|
Amount
|
|
% of
Revenue
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of alcoholic
beverages
|
|
$
27,335
|
|
42.9%
|
|
$
20,273
|
|
46.0%
|
|
$
53,766
|
|
42.8%
|
|
$
37,633
|
|
45.6%
|
|
Sales of food and
merchandise
|
|
11,160
|
|
17.5%
|
|
9,538
|
|
21.6%
|
|
22,054
|
|
17.6%
|
|
18,147
|
|
22.0%
|
|
Service
revenues
|
|
21,501
|
|
33.8%
|
|
11,502
|
|
26.1%
|
|
42,377
|
|
33.8%
|
|
21,562
|
|
26.1%
|
|
Other
|
|
3,696
|
|
5.8%
|
|
2,746
|
|
6.2%
|
|
7,331
|
|
5.8%
|
|
5,115
|
|
6.2%
|
|
|
Total
revenues
|
|
63,692
|
|
100.0%
|
|
44,059
|
|
100.0%
|
|
125,528
|
|
100.0%
|
|
82,457
|
|
100.0%
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Alcoholic beverages
sold
|
|
4,896
|
|
17.9%
|
|
3,730
|
|
18.4%
|
|
9,730
|
|
18.1%
|
|
6,992
|
|
18.6%
|
|
|
Food and merchandise
sold
|
|
3,840
|
|
34.4%
|
|
3,029
|
|
31.8%
|
|
7,797
|
|
35.4%
|
|
5,918
|
|
32.6%
|
|
|
Service and
other
|
|
24
|
|
0.1%
|
|
43
|
|
0.3%
|
|
124
|
|
0.2%
|
|
96
|
|
0.4%
|
|
|
|
Total cost of goods
sold (exclusive of items shown below)
|
|
8,760
|
|
13.8%
|
|
6,802
|
|
15.4%
|
|
17,651
|
|
14.1%
|
|
13,006
|
|
15.8%
|
|
Salaries and
wages
|
|
16,530
|
|
26.0%
|
|
11,200
|
|
25.4%
|
|
33,035
|
|
26.3%
|
|
22,686
|
|
27.5%
|
|
Selling, general and
administrative
|
|
18,437
|
|
28.9%
|
|
12,618
|
|
28.6%
|
|
36,923
|
|
29.4%
|
|
24,770
|
|
30.0%
|
|
Depreciation and
amortization
|
|
2,877
|
|
4.5%
|
|
2,117
|
|
4.8%
|
|
5,071
|
|
4.0%
|
|
4,140
|
|
5.0%
|
|
Other charges (gains),
net
|
|
7
|
|
0.0%
|
|
1,481
|
|
3.4%
|
|
(144)
|
|
-0.1%
|
|
1,431
|
|
1.7%
|
|
|
Total operating
expenses
|
|
46,611
|
|
73.2%
|
|
34,218
|
|
77.7%
|
|
92,536
|
|
73.7%
|
|
66,033
|
|
80.1%
|
Income from
operations
|
|
17,081
|
|
26.8%
|
|
9,841
|
|
22.3%
|
|
32,992
|
|
26.3%
|
|
16,424
|
|
19.9%
|
Other income
(expenses)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(2,864)
|
|
-4.5%
|
|
(2,364)
|
|
-5.4%
|
|
(5,468)
|
|
-4.4%
|
|
(4,798)
|
|
-5.8%
|
|
Interest
income
|
|
112
|
|
0.2%
|
|
62
|
|
0.1%
|
|
218
|
|
0.2%
|
|
122
|
|
0.1%
|
|
Non-operating gains,
net
|
|
-
|
|
0.0%
|
|
431
|
|
1.0%
|
|
84
|
|
0.1%
|
|
5,347
|
|
6.5%
|
Income before income
taxes
|
|
14,329
|
|
22.5%
|
|
7,970
|
|
18.1%
|
|
27,826
|
|
22.2%
|
|
17,095
|
|
20.7%
|
Income tax
expense
|
|
3,356
|
|
5.3%
|
|
1,938
|
|
4.4%
|
|
6,289
|
|
5.0%
|
|
1,554
|
|
1.9%
|
Net income
|
|
10,973
|
|
17.2%
|
|
6,032
|
|
13.7%
|
|
21,537
|
|
17.2%
|
|
15,541
|
|
18.8%
|
Net loss (income)
attributable to noncontrolling interests
|
|
(21)
|
|
0.0%
|
|
59
|
|
0.1%
|
|
(10)
|
|
0.0%
|
|
193
|
|
0.2%
|
Net income attributable
to RCIHH common shareholders
|
|
$
10,952
|
|
17.2%
|
|
$
6,091
|
|
13.8%
|
|
$
21,527
|
|
17.1%
|
|
$
15,734
|
|
19.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
$
1.15
|
|
|
|
$
0.68
|
|
|
|
$
2.28
|
|
|
|
$
1.75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
9,489,085
|
|
|
|
8,999,910
|
|
|
|
9,447,854
|
|
|
|
9,009,604
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends per
share
|
|
$
0.05
|
|
|
|
$
0.04
|
|
|
|
$
0.09
|
|
|
|
$
0.08
|
|
|
RCI HOSPITALITY
HOLDINGS, INC.
|
NON-GAAP FINANCIAL
MEASURES
|
(in thousands, except
per share and percentage data)
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months
|
|
For the Six
Months
|
|
|
Ended March
31,
|
|
Ended March
31,
|
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Reconciliation of
GAAP net income (loss) to Adjusted EBITDA
|
|
|
|
|
|
|
|
|
Net income attributable
to RCIHH common stockholders
|
|
$ 10,952
|
|
$
6,091
|
|
$ 21,527
|
|
$ 15,734
|
Income tax expense
(benefit)
|
|
3,356
|
|
1,938
|
|
6,289
|
|
1,554
|
Interest expense,
net
|
|
2,752
|
|
2,302
|
|
5,250
|
|
4,676
|
Settlement of
lawsuits
|
|
385
|
|
1
|
|
577
|
|
153
|
Impairment of
assets
|
|
-
|
|
1,401
|
|
-
|
|
1,401
|
Loss (gain) on sale of
businesses and assets
|
|
(58)
|
|
91
|
|
(400)
|
|
86
|
Gain on debt
extinguishment
|
|
-
|
|
(380)
|
|
(85)
|
|
(5,329)
|
Unrealized loss on
equity securities
|
|
-
|
|
34
|
|
1
|
|
67
|
Gain on
insurance
|
|
(320)
|
|
(12)
|
|
(321)
|
|
(209)
|
Depreciation and
amortization
|
|
2,877
|
|
2,117
|
|
5,071
|
|
4,140
|
Adjusted
EBITDA
|
|
$ 19,944
|
|
$ 13,583
|
|
$ 37,909
|
|
$ 22,273
|
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP net income (loss) to non-GAAP net income
|
|
|
|
|
|
|
|
|
Net income attributable
to RCIHH common stockholders
|
|
$ 10,952
|
|
$
6,091
|
|
$ 21,527
|
|
$ 15,734
|
Amortization of
intangibles
|
|
49
|
|
79
|
|
99
|
|
158
|
Settlement of
lawsuits
|
|
385
|
|
1
|
|
577
|
|
153
|
Impairment of
assets
|
|
-
|
|
1,401
|
|
-
|
|
1,401
|
Loss (gain) on sale of
businesses and assets
|
|
(58)
|
|
91
|
|
(400)
|
|
86
|
Gain on debt
extinguishment
|
|
-
|
|
(380)
|
|
(85)
|
|
(5,329)
|
Unrealized loss on
equity securities
|
|
-
|
|
34
|
|
1
|
|
67
|
Gain on
insurance
|
|
(320)
|
|
(12)
|
|
(321)
|
|
(209)
|
Net income tax
effect
|
|
291
|
|
(522)
|
|
253
|
|
(1,741)
|
Non-GAAP net
income
|
|
$ 11,299
|
|
$
6,783
|
|
$ 21,651
|
|
$ 10,320
|
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP diluted earnings (loss) per share to non-GAAP diluted earnings
per share
|
|
|
|
|
Diluted
shares
|
|
9,489,085
|
|
8,999,910
|
|
9,447,854
|
|
9,009,604
|
GAAP diluted earnings
per share
|
|
$
1.15
|
|
$
0.68
|
|
$
2.28
|
|
$
1.75
|
Amortization of
intangibles
|
|
0.01
|
|
0.01
|
|
0.01
|
|
0.02
|
Settlement of
lawsuits
|
|
0.04
|
|
0.00
|
|
0.06
|
|
0.02
|
Impairment of
assets
|
|
-
|
|
0.16
|
|
-
|
|
0.16
|
Loss (gain) on sale of
businesses and assets
|
|
(0.01)
|
|
0.01
|
|
(0.04)
|
|
0.01
|
Gain on debt
extinguishment
|
|
-
|
|
(0.04)
|
|
(0.01)
|
|
(0.59)
|
Unrealized loss on
equity securities
|
|
-
|
|
0.00
|
|
0.00
|
|
0.01
|
Gain on
insurance
|
|
(0.03)
|
|
(0.00)
|
|
(0.03)
|
|
(0.02)
|
Net income tax
effect
|
|
0.03
|
|
(0.06)
|
|
0.03
|
|
(0.19)
|
Non-GAAP diluted
earnings per share
|
|
$
1.19
|
|
$
0.75
|
|
$
2.29
|
|
$
1.15
|
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP operating income to non-GAAP operating income
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
$ 17,081
|
|
$
9,841
|
|
$ 32,992
|
|
$ 16,424
|
Amortization of
intangibles
|
|
49
|
|
79
|
|
99
|
|
158
|
Settlement of
lawsuits
|
|
385
|
|
1
|
|
577
|
|
153
|
Impairment of
assets
|
|
-
|
|
1,401
|
|
-
|
|
1,401
|
Loss (gain) on sale of
businesses and assets
|
|
(58)
|
|
91
|
|
(400)
|
|
86
|
Gain on
insurance
|
|
(320)
|
|
(12)
|
|
(321)
|
|
(209)
|
Non-GAAP operating
income
|
|
$ 17,137
|
|
$ 11,401
|
|
$ 32,947
|
|
$ 18,013
|
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP operating margin to non-GAAP operating margin
|
|
|
|
|
|
|
|
GAAP operating
margin
|
|
26.8%
|
|
22.3%
|
|
26.3%
|
|
19.9%
|
Amortization of
intangibles
|
|
0.1%
|
|
0.2%
|
|
0.1%
|
|
0.2%
|
Settlement of
lawsuits
|
|
0.6%
|
|
0.0%
|
|
0.5%
|
|
0.2%
|
Impairment of
assets
|
|
0.0%
|
|
3.2%
|
|
0.0%
|
|
1.7%
|
Loss (gain) on sale of
businesses and assets
|
|
-0.1%
|
|
0.2%
|
|
-0.3%
|
|
0.1%
|
Gain on
insurance
|
|
-0.5%
|
|
0.0%
|
|
-0.3%
|
|
-0.3%
|
Non-GAAP operating
margin
|
|
26.9%
|
|
25.9%
|
|
26.2%
|
|
21.8%
|
|
|
|
|
|
|
|
|
|
Reconciliation of
net cash provided by operating activities to free cash
flow
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
$ 11,597
|
|
$ 10,972
|
|
$ 27,861
|
|
$ 17,246
|
Less: Maintenance
capital expenditures
|
|
518
|
|
1,986
|
|
1,516
|
|
2,591
|
Free cash
flow
|
|
$ 11,079
|
|
$
8,986
|
|
$ 26,345
|
|
$ 14,655
|
RCI HOSPITALITY
HOLDINGS, INC.
|
SEGMENT
INFORMATION
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months
|
|
For the Six
Months
|
|
|
|
Ended March
31,
|
|
Ended March
31,
|
|
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Revenues
|
|
|
|
|
|
|
|
|
|
Nightclubs
|
|
$
48,174
|
|
$
30,787
|
|
$
94,955
|
|
$
55,984
|
|
Bombshells
|
|
15,333
|
|
13,135
|
|
30,104
|
|
26,141
|
|
Other
|
|
185
|
|
137
|
|
469
|
|
332
|
|
|
|
$
63,692
|
|
$
44,059
|
|
$ 125,528
|
|
$
82,457
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
|
|
|
|
|
|
|
|
Nightclubs
|
|
$
19,126
|
|
$
10,468
|
|
$
37,862
|
|
$
18,963
|
|
Bombshells
|
|
3,468
|
|
3,142
|
|
6,270
|
|
5,859
|
|
Other
|
|
(34)
|
|
(139)
|
|
(77)
|
|
(214)
|
|
General
corporate
|
|
(5,479)
|
|
(3,630)
|
|
(11,063)
|
|
(8,184)
|
|
|
|
$
17,081
|
|
$
9,841
|
|
$
32,992
|
|
$
16,424
|
RCI HOSPITALITY
HOLDINGS, INC.
|
NON-GAAP SEGMENT
INFORMATION
|
($ in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended March 31, 2022
|
|
For the Three Months
Ended March 31, 2021
|
|
|
Nightclubs
|
|
Bombshells
|
|
Other
|
|
Corporate
|
|
Total
|
|
Nightclubs
|
|
Bombshells
|
|
Other
|
|
Corporate
|
|
Total
|
Income (loss) from
operations
|
|
$ 19,126
|
|
$
3,468
|
|
$
(34)
|
|
$ (5,479)
|
|
$ 17,081
|
|
$ 10,468
|
|
$
3,142
|
|
$
(139)
|
|
$ (3,630)
|
|
$
9,841
|
Amortization of
intangibles
|
|
47
|
|
1
|
|
-
|
|
1
|
|
49
|
|
47
|
|
3
|
|
29
|
|
-
|
|
79
|
Settlement of
lawsuits
|
|
277
|
|
-
|
|
-
|
|
108
|
|
385
|
|
(4)
|
|
-
|
|
5
|
|
-
|
|
1
|
Impairment of
assets
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,401
|
|
-
|
|
-
|
|
-
|
|
1,401
|
Loss (gain) on sale of
businesses and assets
|
|
(125)
|
|
4
|
|
-
|
|
63
|
|
(58)
|
|
14
|
|
47
|
|
-
|
|
30
|
|
91
|
Gain on
insurance
|
|
(320)
|
|
-
|
|
-
|
|
-
|
|
(320)
|
|
32
|
|
-
|
|
-
|
|
(44)
|
|
(12)
|
Non-GAAP operating
income (loss)
|
|
$ 19,005
|
|
$
3,473
|
|
$
(34)
|
|
$ (5,307)
|
|
$ 17,137
|
|
$ 11,958
|
|
$
3,192
|
|
$
(105)
|
|
$ (3,644)
|
|
$ 11,401
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
margin
|
|
39.7%
|
|
22.6%
|
|
-18.4%
|
|
-8.6%
|
|
26.8%
|
|
34.0%
|
|
23.9%
|
|
-101.5%
|
|
-8.2%
|
|
22.3%
|
Non-GAAP operating
margin
|
|
39.5%
|
|
22.7%
|
|
-18.4%
|
|
-8.3%
|
|
26.9%
|
|
38.8%
|
|
24.3%
|
|
-76.6%
|
|
-8.3%
|
|
25.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months
Ended March 31, 2022
|
|
For the Six Months
Ended March 31, 2021
|
|
|
Nightclubs
|
|
Bombshells
|
|
Other
|
|
Corporate
|
|
Total
|
|
Nightclubs
|
|
Bombshells
|
|
Other
|
|
Corporate
|
|
Total
|
Income (loss) from
operations
|
|
$ 37,862
|
|
$
6,270
|
|
$
(77)
|
|
$
(11,063)
|
|
$ 32,992
|
|
$ 18,963
|
|
$
5,859
|
|
$
(214)
|
|
$ (8,184)
|
|
$ 16,424
|
Amortization of
intangibles
|
|
94
|
|
4
|
|
-
|
|
1
|
|
99
|
|
94
|
|
7
|
|
57
|
|
-
|
|
158
|
Settlement of
lawsuits
|
|
454
|
|
10
|
|
-
|
|
113
|
|
577
|
|
114
|
|
34
|
|
5
|
|
-
|
|
153
|
Impairment of
assets
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,401
|
|
-
|
|
-
|
|
-
|
|
1,401
|
Loss (gain) on sale of
businesses and assets
|
|
(80)
|
|
17
|
|
-
|
|
(337)
|
|
(400)
|
|
14
|
|
47
|
|
-
|
|
25
|
|
86
|
Gain on
insurance
|
|
(321)
|
|
-
|
|
-
|
|
-
|
|
(321)
|
|
(165)
|
|
-
|
|
-
|
|
(44)
|
|
(209)
|
Non-GAAP operating
income (loss)
|
|
$ 38,009
|
|
$
6,301
|
|
$
(77)
|
|
$
(11,286)
|
|
$ 32,947
|
|
$ 20,421
|
|
$
5,947
|
|
$
(152)
|
|
$ (8,203)
|
|
$ 18,013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
margin
|
|
39.9%
|
|
20.8%
|
|
-16.4%
|
|
-8.8%
|
|
26.3%
|
|
33.9%
|
|
22.4%
|
|
-64.5%
|
|
-9.9%
|
|
19.9%
|
Non-GAAP operating
margin
|
|
40.0%
|
|
20.9%
|
|
-16.4%
|
|
-9.0%
|
|
26.2%
|
|
36.5%
|
|
22.7%
|
|
-45.8%
|
|
-9.9%
|
|
21.8%
|
RCI HOSPITALITY
HOLDINGS, INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended
|
|
For the Six Months
Ended
|
|
|
|
|
March 31,
2022
|
|
March 31,
2021
|
|
March 31,
2022
|
|
March 31,
2021
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
Net income
|
|
$
10,973
|
|
$
6,032
|
|
$
21,537
|
|
$
15,541
|
Adjustments to
reconcile net income to net cash
|
|
|
|
|
|
|
|
|
provided by operating
activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
2,877
|
|
2,117
|
|
5,071
|
|
4,140
|
|
Loss (gain) on sale of
businesses and assets
|
|
(185)
|
|
91
|
|
(708)
|
|
86
|
|
Impairment of
assets
|
|
-
|
|
1,401
|
|
-
|
|
1,401
|
|
Unrealized loss on
equity securities
|
|
-
|
|
34
|
|
1
|
|
67
|
|
Amortization of debt
discount and issuance costs
|
|
85
|
|
50
|
|
136
|
|
101
|
|
Gain on debt
extinguishment
|
|
-
|
|
(378)
|
|
(83)
|
|
(5,298)
|
|
Noncash lease
expense
|
|
609
|
|
427
|
|
1,238
|
|
848
|
|
Gain on
insurance
|
|
(321)
|
|
(44)
|
|
(321)
|
|
(294)
|
|
Doubtful accounts
expense (reversal) on notes receivable
|
|
36
|
|
35
|
|
53
|
|
(58)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
(279)
|
|
1,704
|
|
1,065
|
|
3,137
|
|
|
Inventories
|
|
169
|
|
(9)
|
|
(276)
|
|
(31)
|
|
|
Prepaid expenses, other
current assets and other assets
|
|
1,159
|
|
369
|
|
(5,360)
|
|
1,494
|
|
|
Accounts payable,
accrued and other liabilities
|
|
(3,526)
|
|
(857)
|
|
5,508
|
|
(3,888)
|
|
Net cash provided by
operating activities
|
|
11,597
|
|
10,972
|
|
27,861
|
|
17,246
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
Proceeds from sale of
businesses and assets
|
|
2,107
|
|
8
|
|
2,910
|
|
8
|
Proceeds from
insurance
|
|
300
|
|
44
|
|
485
|
|
294
|
Proceeds from notes
receivable
|
|
48
|
|
35
|
|
82
|
|
61
|
Payments for property
and equipment and intangible assets
|
|
(4,140)
|
|
(5,429)
|
|
(13,990)
|
|
(6,718)
|
Acquisition of
businesses, net of cash acquired
|
|
-
|
|
-
|
|
(39,302)
|
|
-
|
|
Net cash used in
investing activities
|
|
(1,685)
|
|
(5,342)
|
|
(49,815)
|
|
(6,355)
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
Proceeds from debt
obligations
|
|
18,740
|
|
2,176
|
|
35,742
|
|
2,176
|
Payments on debt
obligations
|
|
(4,802)
|
|
(4,232)
|
|
(7,290)
|
|
(5,977)
|
Purchase of treasury
stock
|
|
(2,845)
|
|
-
|
|
(2,845)
|
|
(1,794)
|
Payment of
dividends
|
|
(474)
|
|
(360)
|
|
(854)
|
|
(720)
|
Payment of loan
origination costs
|
|
(418)
|
|
(25)
|
|
(418)
|
|
(25)
|
|
Net cash provided by
(used in) financing activities
|
|
10,201
|
|
(2,441)
|
|
24,335
|
|
(6,340)
|
NET INCREASE IN CASH
AND CASH EQUIVALENTS
|
|
20,113
|
|
3,189
|
|
2,381
|
|
4,551
|
CASH AND CASH
EQUIVALENTS AT BEGINNING OF PERIOD
|
|
17,954
|
|
16,967
|
|
35,686
|
|
15,605
|
CASH AND CASH
EQUIVALENTS AT END OF PERIOD
|
|
$
38,067
|
|
$
20,156
|
|
$
38,067
|
|
$
20,156
|
RCI HOSPITALITY
HOLDINGS, INC.
|
CONSOLIDATED BALANCE
SHEETS
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
September
30,
|
|
March
31,
|
|
|
|
|
|
2022
|
|
2021
|
|
2021
|
ASSETS
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
38,067
|
|
$
35,686
|
|
$
20,156
|
|
Accounts receivable,
net
|
|
6,262
|
|
7,570
|
|
3,630
|
|
Current portion of
notes receivable
|
|
292
|
|
220
|
|
214
|
|
Inventories
|
|
3,361
|
|
2,659
|
|
2,403
|
|
Prepaid expenses and
other current assets
|
|
6,880
|
|
1,928
|
|
5,020
|
|
Assets held for
sale
|
|
6,126
|
|
4,887
|
|
7,382
|
|
|
Total current
assets
|
|
60,988
|
|
52,950
|
|
38,805
|
Property and equipment,
net
|
|
203,434
|
|
175,952
|
|
175,153
|
Operating lease
right-of-use assets, net
|
|
36,180
|
|
24,308
|
|
24,698
|
Notes receivable, net
of current portion
|
|
5,411
|
|
2,839
|
|
2,892
|
Goodwill
|
|
54,484
|
|
39,379
|
|
45,686
|
Intangibles,
net
|
|
125,284
|
|
67,824
|
|
73,070
|
Other assets
|
|
1,771
|
|
1,367
|
|
806
|
|
|
|
Total assets
|
|
$
487,552
|
|
$
364,619
|
|
$
361,110
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
6,255
|
|
$
4,408
|
|
$
4,021
|
|
Accrued
liabilities
|
|
15,576
|
|
10,403
|
|
12,321
|
|
Current portion of
long-term debt, net
|
|
11,177
|
|
6,434
|
|
16,380
|
|
Current portion of
operating lease liabilities
|
|
2,306
|
|
1,780
|
|
1,692
|
|
|
Total current
liabilities
|
|
35,314
|
|
23,025
|
|
34,414
|
Deferred tax liability,
net
|
|
22,040
|
|
19,137
|
|
20,390
|
Debt, net of current
portion and debt discount and issuance costs
|
|
166,903
|
|
118,734
|
|
116,032
|
Operating lease
liabilities, net of current portion
|
|
35,517
|
|
24,150
|
|
24,583
|
Other long-term
liabilities
|
|
355
|
|
350
|
|
357
|
|
|
Total
liabilities
|
|
260,129
|
|
185,396
|
|
195,776
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
Preferred
stock
|
|
-
|
|
-
|
|
-
|
|
Common stock
|
|
94
|
|
90
|
|
90
|
|
Additional paid-in
capital
|
|
77,553
|
|
50,040
|
|
50,040
|
|
Retained
earnings
|
|
150,366
|
|
129,693
|
|
115,811
|
|
|
Total RCIHH
stockholders' equity
|
|
228,013
|
|
179,823
|
|
165,941
|
|
Noncontrolling
interests
|
|
(590)
|
|
(600)
|
|
(607)
|
|
|
Total equity
|
|
227,423
|
|
179,223
|
|
165,334
|
|
|
|
Total liabilities and
equity
|
|
$
487,552
|
|
$
364,619
|
|
$
361,110
|
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SOURCE RCI Hospitality Holdings, Inc.