Rick's Cabaret International, Inc. Enters Florida Market With $25 Million Acquisition of Tootsies Cabaret
Mega Gentlemen's Club Expected to Add $18 Million in Annual Revenue and
$8.8 Million in EBITDA
HOUSTON-(December 3, 2007)-Rick's Cabaret International, Inc.
a leading operator of gentlemen's clubs, announced today that it has acquired
, a 47,000-square-foot adult club in Miami Gardens,
Florida, for $25 million.
Rick's Cabaret closed on the transaction Friday, November 30th and assumed
management of the mega club on December 1st. Management expects annual
revenues from Tootsies will be approximately $18 million, with annual
EBITDA of about $8.8 million. By closing this transaction a month earlier
then originally anticipated, the company believes it will easily achieve
the guidance of $52 million in revenue and $7 million (or 95 cents per
share) in net income for fiscal 2008 that it projected on Oct. 31, 2007.
"Tootsies is one of the top ten adult nightclubs in the entire
country," said Eric Langan
, President and CEO of
Rick's Cabaret. "This acquisition solidifies Rick's Cabaret's position
as the premier gentlemen's club company and has significantly advanced
our strategic acquisition program." Tootsies won "Best Adult
Club of the Southeast" at the 2007 Exotic Dancer Awards Show. It
was been Named the best Adult Club in Miami by New Times
and City Search
. Xcitement Magazine
proclaimed, Tooties "Out Vegas'es Vegas"
The multi-level club, which bills itself as "South Florida's Supreme
Adult Nightclub," is open from noon until 5 a.m. daily and noon to
6am on weekends, with up to 250 entertainers daily, who dance fully nude.
It has full restaurant service, three liquor bars plus a 400 square foot
main stage on the first floor, over 30 plasma screen TVs, 11 large projection
screens, a private Champagne room and three spacious and private dance
rooms. The "Next Level" VIP floor offers full unobstructed views
of the entire club, five state of the art sky box rooms, spacious private
dance rooms and luxury seating. The VIP area also includes "Tootsies
Transit Car," a scaled replica of a New York City subway car designed
for private dances.
Rick's Cabaret purchased all the outstanding shares in Miami Gardens
Square One, Inc.
and Stellar Management Corporation
from its previous owners. Under terms of the purchase agreement Rick's
Cabaret paid $15 million in cash and issued to the two prior owners $10
million in promissory notes, payable with monthly interest only payments
and a balloon payment of the principal amount due in three years. Rick‚s
Cabaret also assumed leases on all of the club‚s property that,
with options, run through June 2034. Details of the terms of the transaction
are included in a Form 8-K filed by the company with the Securities and
Tootsies is located at 150 NW 183rd St., known as Miami Gardens Drive,
near the confluence of I-95, the Florida Turnpike, U.S. 441 and Florida
Route 826. The club has over 5 acres of outdoor parking and nearly 200
indoor parking spots.
The acquisition brings to 15 the number of adult nightclubs operated by
the company, including the flagship Rick's Cabaret on West 33rd Street
in Midtown Manhattan and other clubs in Texas, Minnesota and North Carolina.
The Rick's Cabaret acquisition strategy is to acquire leading adult clubs
in major markets that are immediately accretive to corporate earnings.
Rick’s Cabaret International, Inc. (NASDAQ: RICK) operates
upscale adult nightclubs serving primarily businessmen and professionals
that offer live adult entertainment, restaurant and bar operations.
The company owns and operates or licenses adult nightclubs in New
York City, New Orleans, Charlotte, Houston, Minneapolis and other
cities under the names "Rick's Cabaret," "XTC"
and "Club Onyx." No sexual contact is permitted at any
of these locations. Rick's Cabaret also owns the adult Internet
membership Web site, couplestouch.com,
and a network of online adult auction sites under the flagship URL
Cabaret common stock is traded on NASDAQ under the symbol RICK.
For further information contact [email protected].
This document contains 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
document, including: the risks and uncertainties associated
with operating and managing an adult business; the business
climates in New York City and elsewhere; the success or lack thereof
in launching and building the company's businesses in New York City
and elsewhere; the Company's ability to identify and secure suitable
locations for new nightclubs on acceptable terms, open the anticipated
number of new nightclubs on time and within budget; achieve anticipated
rates of same-store sales; hire and train additional nightclub personnel
and integrate new nightclubs into its operations; unexpected increases
in costs of sales or employee, pre-opening or other expenses; the
economic conditions in the new markets into which the Company expands
and possible uncertainties in the customer base in these areas;
fluctuations in quarterly operating results; the impact of any negative
publicity or public attitudes; competitive pressure from other national
and regional nightclub chains; 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
go to www.ricks.com.
for further information: Allan Priaulx, 212-338-0050, [email protected]