Rick's Cabaret International Inc. Reports First Quarter Revenues Of $17.3 Million With Net Of $790,832
HOUSTON - (February 17, 2009) -
Rick's Cabaret International,
Inc. [NASDAQ-GM:RICK], the nation's premier operator of upscale gentlemen's clubs, reported consolidated total revenues of $17,311,171 for its first quarter ending December 31, 2008, compared to $10,954,338 for the same period in the previous year, an increase of 58 percent. The company had net income of $790,832 for the period or eight cents per diluted share, compared with $1,783,272 or 24 cents per share in the previous year.
The higher revenues were primarily attributable to increases of $6,360,179 from the company's new clubs in Miami, Dallas, Philadelphia and Las Vegas as well as its new media division. Total revenues for same-location-same-period of club operations were essentially flat at $8,767,438, compared with $8,772,902 a year earlier, which the company attributes primarily to decreased customer traffic and spending related to the recession.
The company attributed the drop in earnings to a number of factors, including operating losses exceeding $1.9 million from some of its nightclubs, plus other factors including higher taxes, debt service, the cost of rebranding its Philadelphia nightclub, and an impairment taken in connection with the valuation of a nightclub in San Antonio, Texas.
Eric Langan, President and CEO of Rick's Cabaret, will discuss the company's first quarter performance during a conference call with investors today at 4:30 p.m. ET. The call is being webcast by Vcall [http://www.investorcalendar.com/IC/CEPage.asp?ID=140911] and can be accessed at the Rick's Cabaret website, www.ricks.com or www.InvestorCalendar.com. The toll free live participant dial-in number is 877-407-8033; international callers should dial 201-689-8033. The toll free replay number is 877-660-6853 (international calls 201-612-7415) and the call will be available until May 17, 2009. Please enter the number 286 when asked for the account, and then conference ID number 312902.
In its Form 10-Q filed with the Securities and Exchange Commission the company said it has taken significant steps to remedy losses at several clubs. Early results from the conversion of Rick's Cabaret in Dallas to an XTC Cabaret "are very encouraging," the company said, and conversion of Rick's Cabaret in Philadelphia to the company's Club Onyx format has already resulted in a profitable January and "we expect continued profitability in 2009 going forward."
The company said it has taken steps to improve performance at its Las Vegas club pending improvement in the tourist-based economy, including significant cost reductions and aggressive marketing campaigns to attract more local customers.
The company also took an impairment of $221,563 for estimated losses on its Encounters nightclub in San Antonio. The company is currently in negotiations to sell the club.
RICK'S CABARET INTERNATIONAL, INC. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
|
FOR THE THREE
MONTHS
ENDED DECEMBER 31, |
|
|
|
|
|
2008 |
|
2007 |
|
(UNAUDITED) |
|
|
|
|
Revenues: |
|
|
|
| Sales of alcoholic beverages |
$ 6,736,310 |
|
$ 4,195,192 |
| Sales of food and merchandise |
1,429,385 |
|
1,060,332 |
| Service revenues |
8,195,202 |
|
5,023,497 |
| Internet revenues |
176,763 |
|
170,789 |
| Media revenues |
183,636 |
|
- |
| Other |
589,875 |
|
504,528 |
Total revenues |
17,311,171 |
|
10,954,338 |
|
|
|
|
Operating
expenses: |
|
|
|
Cost of goods sold |
2,269,588 |
|
1,341,831 |
Salaries and wages |
4,297,117 |
|
2,586,476 |
Stock-based
compensation |
20,044 |
|
39,270 |
Other general and
administrative: |
|
|
|
Taxes and permits |
2,353,491 |
|
1,235,793 |
Charge card fees |
339,699 |
|
198,710 |
Rent |
963,362 |
|
464,455 |
Legal and professional |
509,049 |
|
293,373 |
Advertising and
marketing |
1,177,311 |
|
360,832 |
Insurance |
243,047 |
|
201,396 |
Utilities |
442,698 |
|
209,735 |
Impairment of nightclub assets |
221,563 |
|
- |
Depreciation and amortization |
869,893 |
|
511,339 |
| Other |
1,447,174 |
|
939,231 |
Total operating expenses |
15,154,036 |
|
8,382,441 |
Income from operations |
2,157,135 |
|
2,571,897 |
|
|
|
|
Other income
(expense): |
|
|
|
Interest income |
5,734 |
|
43,069 |
| Interest expense |
(833,471) |
|
(461,883) |
| Minority
interests |
(73,500) |
|
177,911 |
Income before income
taxes |
1,255,898 |
|
2,330,994 |
Income taxes |
465,066 |
|
547,722 |
Net
income |
$ 790,832 |
|
$ 1,783,272 |
Basic and
diluted earnings per share: |
|
|
|
Net income, basic |
$ 0.08 |
|
$ 0.26 |
Net income, diluted |
$ 0.08 |
|
$ 0.24 |
Weighted average number of common shares outstanding: |
|
|
|
| Basic |
9,366,033 |
|
6,806,234 |
| Diluted |
9,599,954 |
|
7,635,326 |
About Rick's
Cabaret:
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, operates or licenses adult nightclubs in New York City, Miami, Philadelphia, Las Vegas, New Orleans, Charlotte, Dallas, Houston, Minneapolis and other cities under the names "Rick's Cabaret," "XTC," "Club Onyx" and "Tootsie's Cabaret". Sexual contact is not permitted at these locations. Rick's Cabaret also owns the adult Internet membership Web site, couplestouch.com; a network of online adult auction sites under the flagship URL naughtybids.com; ED Publications, the national trade magazine and convention for the adult nightclub industry; and Storerotica, the national trade magazine and convention for the adult product and intimate apparel industries. Rick's Cabaret common stock is traded on the NASDAQ Global Market under the symbol RICK. For further information contact [email protected].
Forward-Looking Statements:
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, 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.ricks.com.
Media Contact: Allan Priaulx, 212-338-0050, [email protected]