Rick's Cabaret International, Inc. Reports First Quarter Revenues Of $20 Million, Up 16.8%; Net Income Impacted By Aggressive Marketing And Acquisition Costs
HOUSTON - (February 16, 2010) -
Rick's Cabaret International,
Inc. [NASDAQ-GM:RICK],
today reported consolidated total revenues of $20 million for its first quarter ending Dec. 31, 2009, a 16.8 percent increase over the same period a year ago. The increase was primarily attributed to a 14.5 percent increase in same store sales plus revenues from new nightclubs in Austin and Ft. Worth.
Net income attributable to Rick's shareholders for the period was $782,688, compared with $790,832 in the same quarter in the previous year or eight cents per fully diluted share, the same as in 2009. Income from continuing operations before income tax was $1.4 million for the quarter, compared with $1.6 million for the same quarter in the previous year.
Eric Langan, President and CEO of Rick's Cabaret International, said net income was impacted by expenses associated with acquisition activities and aggressive marketing costs, which totaled $2.9 million compared with $1.2 million in the same quarter one year ago.
"These expenses are largely behind us now and we are on track with our earnings guidance," Mr. Langan said.
"Our income was impacted by a very aggressive and successful campaign in Las Vegas to capture market share and prepare for upcoming national conventions," Mr. Langan said. "This program is already paying off because we had a profit of about $100,000 in Las Vegas in January, and we have now been able to significantly lower our Vegas marketing costs. We also spent considerable sums on marketing in advance of the Super Bowl, Pro-Bowl and NBA All-Star Game, and for the launch of newly acquired clubs. These costs have now been largely eliminated."
Mr. Langan will discuss the results in a conference call at 4:30 p.m. ET today. The call is being webcast by Vcall and can be accessed at the Rick's Cabaret website, www.ricks.com or www.InvestorCalendar.com. The toll free Live Participant Dial In number is 877-407-8033, while international callers should use 201-689-8033. The toll free replay number 877-660-6853, while international callers should use 201-612-7415. Replay passcodes required for playback are: Account #: 286 and Conference ID #: 344435.
RICK'S
CABARET INTERNATIONAL, INC. CONSOLIDATED STATEMENTS OF INCOME
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Three Months Ended December 31,
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2009
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2008
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(UNAUDITED)
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Revenues:
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Sales of alcoholic beverages
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$ 8,049,465
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$ 6,633,571
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Sales of food and merchandise
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1,590,011
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1,420,066
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Service revenues
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9,292,249
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8,139,890
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Internet revenues
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145,005
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176,763
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Media revenues
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256,757
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183,636
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Other
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671,099
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579,769
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Total revenues
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20,004,586
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17,133,695
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Operating
expenses:
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Cost of goods sold
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2,456,107
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2,229,474
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Salaries and wages
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4,310,305
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4,220,886
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Stock-based compensation
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44,037
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20,044
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Other general and administrative:
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Taxes and permits
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2,835,564
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2,319,300
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Charge card fees
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346,188
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338,541
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Rent
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993,133
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917,962
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Legal and professional
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649,609
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504,049
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Advertising and marketing
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2,938,173
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1,172,371
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Depreciation and amortization
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842,358
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844,352
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Insurance
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261,851
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239,237
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Utilities
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405,869
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428,918
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Other
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1,535,644
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1,422,340
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Total operating expenses
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17,618,838
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14,657,474
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Income
from operations
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2,385,748
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2,476,221
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Other
income (expense):
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Interest income
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3,673
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5,734
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Interest expense
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(1,028,583
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(833,471
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Gain on change in fair value of
derivative instruments
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44,275
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-
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Income
from continuing operations before income taxes
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1,405,113
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1,648,484
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Income
taxes
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513,548
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576,746
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Income
from continuing operations
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891,565
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1,071,738
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Loss
from discontinued operations, net of income taxes of $19,899 and $111,680
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(35,377
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(207,406
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Net income
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856,188
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864,332
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Less:
net income attributable to noncontrolling interests
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(73,500
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(73,500
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Net
income attributable to Rick’s Cabaret International, Inc.
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$ 782,688
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$ 790,832
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Basic
earnings (loss) per share attributable to Rick’s shareholders:
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Income from continuing operations
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$ 0.09
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$ 0.11
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Loss from discontinued operations
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(0.00
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(0.02
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Net income
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$ 0.08
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$ 0.08
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Diluted earnings (loss) per share attributable
to Rick’s shareholders:
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Income from continuing
operations
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$ 0.09
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$ 0.10
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Loss from discontinued operations
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(0.00
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(0.02
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Net income
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$ 0.08
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$ 0.08
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Weighted average number of
common shares outstanding:
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Basic
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9,370,175
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9,366,033
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Diluted
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9,385,209
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9,599,954
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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 cities where it operates, the success or lack thereof in launching and building the company’s businesses, 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.
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 operates a media division, ED Publication, and owns the adult Internet membership Web site, couplestouch.com as well as a network of online adult auction sites under the flagship URL naughtybids.com. Rick's Cabaret common stock is traded on the NASDAQ Global Market under the symbol RICK. For further information contact [email protected].
Media Contact: Allan Priaulx, 212-338-0050, [email protected]