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United States
Securities and Exchange Commission
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 16, 2024
RCI HOSPITALITY HOLDINGS, INC.
(Exact Name of Registrant as Specified in Its Charter)
Texas001-1399276-0458229
(State or Other Jurisdiction
of Incorporation)
(Commission
File Number)
(IRS Employer
Identification No.)
10737 Cutten Road
Houston, Texas 77066
(Address of Principal Executive Offices, Including Zip Code)
(281) 397-6730
(Issuer’s Telephone Number, Including Area Code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a -12)
oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d -2(b))
oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e -4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, $0.01 par valueRICKThe Nasdaq Global Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o


ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On December 16, 2024, we issued a press release announcing results for the fiscal quarter and year ended September 30, 2024, and the filing of our annual report on Form 10-K for the fiscal year ended September 30, 2024. Also on December 16, 2024, we will hold a conference call to discuss these results and related matters. A copy of the press release is furnished as Exhibit 99.1 to this current report on Form 8-K.
This information shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
 
(d) Exhibits
 
Exhibit Number Description
   
99.1 
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
RCI HOSPITALITY HOLDINGS, INC.
Date: December 16, 2024By:/s/ Eric Langan
Eric Langan
President and Chief Executive Officer
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RCI Reports 4Q24 & FY24 Results, Launches 5-Year Capital Allocation Plan, Hosts 4:30 PM ET X Spaces Call Today
HOUSTON—December 16, 2024—RCI Hospitality Holdings, Inc. (Nasdaq: RICK) today reported results for the fiscal 2024 fourth quarter and year ended September 30, 2024. The company also filed its Form 10-K today and announced details of its "Back to Basics" Five-Year Capital Allocation Plan.
Summary Financials (in millions except EPS)4Q244Q23FY24FY23
Total revenues$73.2$75.3$295.6$293.8
EPS$0.03$0.23$0.33$3.13
Non-GAAP EPS1
$1.63$1.11$4.72$4.90
Impairments and other charges, net
$10.1$9.9$36.6$15.6
Net cash provided by operating activities
$15.7$12.1$55.9$59.1
Free cash flow1
$13.2$11.1$48.4$53.2
Net income attributable to RCIHH common stockholders
$0.2$2.2$3.0$29.2
Adjusted EBITDA1
$17.9$20.2$72.6$85.0
Weighted average shares used in computing EPS – basic and diluted9.01 9.42 9.25 9.34 
1 See “Non-GAAP Financial Measures” below
4Q24 Summary (Comparisons are to the year-ago period unless indicated otherwise)
Eric Langan, President and CEO, said: "Nightclubs same-store sales increased for the second quarter in a row, the first time since the first half of FY23, but total company sales declined due to a hurricane and fire, resulting in a lower EPS. However, non-GAAP EPS, net cash provided by operating activities, and free cash flow all increased. We ended FY24 with 8.955 million shares outstanding, down 4.7% year over year, and have continued to buy back shares in the market.”
"Back to Basics" FY25-29 Capital Allocation Plan
Mr. Langan continued: “RCI has grown significantly since we initiated our Capital Allocation Strategy at year-end FY15. Revenue has more than doubled, from $135 million to $296 million, a CAGR of 9%. More importantly, free cash flow has more than tripled, from $15 million to $48 million, a CAGR of 14%, while our share count fell by 13%. We are proud of this achievement and thank all employees, entertainers, and partners who made this possible."
“Looking ahead, we plan to build on this track record through a 'Back-to-Basics' strategy. Operationally, this means focusing on our Nightclub business and improving Bombshells. For capital allocation, this means focusing on club acquisitions and returning more capital to shareholders, mainly through buybacks."
Operational
Priorities
Capital Allocation
Priorities (% of FCF)
FY29
Financial Targets
Focus on Existing Nightclubs
Nightclub Acquisitions: 50%
(includes debt repayment)
Total Revenues: $400M
Improve Bombshells
Free Cash Flow: $75M
Acquire New Nightclubs
Share Buybacks & Dividends: 50%
Shares Outstanding: 7.5M
X-Spaces Conference Call at 4:30 PM ET Today
•Hosted by RCI President & CEO Eric Langan, CFO Bradley Chhay, and Mark Moran of Equity Animal
•Call link: https://x.com/i/spaces/1DXGydpRRRLKM (X log in required)
•Presentation link: https://www.rcihospitality.com/investor-relations/
•To ask questions: Participants must join the X Space using a mobile device
•To listen only: Participants can access the X Space from a computer
•There will be no other types of telephone or webcast access
1

4Q24 Results (Comparisons are to the year-ago period unless indicated otherwise)
Nightclubs segment: Revenues of $60.6 million decreased by 0.5%. Sales reflected 2.2% same-store sales growth, which was negatively impacted by 10 closure days at three Houston area clubs due to the July hurricane. Sales also reflected three new and reformatted clubs, the temporary closing of two clubs, and the transition of two clubs to new formats and/or hours.2
By type of revenue, alcoholic beverages increased by 0.3%; food, merchandise and other increased by 0.9%; and service decreased by 1.7%. The differing growth rates primarily reflected higher alcohol and food, and lower service sales from clubs acquired last year.
The quarter included total impairments and other charges of $6.9 million compared to $8.9 million, resulting in operating income of $13.1 million (21.5% of segment revenues) compared to $12.1 million (19.8%). Non-GAAP operating income was $20.5 million (33.8% of segment revenues) compared to $21.6 million (35.4%). The difference in non-GAAP operating margin reflected minimum wage increases that took effect in July and September 2024 in various locations.
Bombshells segment: Revenues of $11.9 million declined 12.1%. Sales reflected a 16.2% SSS decline, which was negatively impacted by 26 closure days at five Houston area locations due to the July hurricane. New sales from the Stafford location, which opened in November 2023, partially offset the early September 2024 divestiture of the San Antonio location.2
The quarter included total impairments and other charges of $3.2 million compared to $0.2 million, resulting in an operating loss of $2.5 million (-21.1% of segment revenues) compared to income of $1.2 million (8.7%). Non-GAAP operating income was $0.7 million (5.9% of segment revenues) compared to $1.4 million (10.4%). The difference in non-GAAP operating margin reflects lower SSS and weather related closures.
Corporate segment: Expenses totaled $7.1 million (9.7% of total revenues) compared to $6.8 million (9.0%). Non-GAAP expenses totaled $6.6 million (9.0% of total revenues) compared to $6.3 million (8.4%).
Impairments and other charges, net of $10.1 million within consolidated operations mainly included impairment of $7.0 million related to nine clubs and $5.5 million related to six Bombshells and the food hall, and a $2.3 million net gain from the elimination of debt from the sale of Bombshells San Antonio.
Income tax was a benefit of $0.8 million compared to $0.6 million. The effective tax rate was a benefit of 15.7% in FY24 compared to an expense of 19.0% in FY23.
Weighted average shares outstanding of 9.01 million decreased 4.4% due to share buybacks partially offset by shares issued in the 2Q23 Baby Dolls-Chicas Locas acquisition.
Share Repurchases: In 4Q24, RCI repurchased 174,790 common shares for $7.8 million ($44.81 average per share), resulting in 8,955,000 shares of common stock outstanding and $21.0 million in remaining purchase authorization. For all of FY24, RCI repurchased 442,639 shares for $20.6 million ($46.55 average per share).
Debt was $238.2 million at September 30, 2024 compared to $245.4 million at June 30, 2024 and $239.8 million at September 30, 2023. The June-September 2024 decline primarily reflected elimination of Bombshells San Antonio debt and scheduled pay downs.
2 See our October 8, 2024, news release on 4Q24 sales for more details
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:
2

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) impairment of assets, (c) gains or losses on sale of businesses and assets, (d) gains or losses on insurance, (e) settlement of lawsuits, and (f) stock-based compensation. 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) settlement of lawsuits, (f) gain on debt extinguishment, (g) stock-based compensation, (h) the income tax effect of the above-described adjustments, and (i) change in deferred tax asset valuation allowance. Included in the income tax effect of the above adjustments is the net effect of the non-GAAP provision for income taxes, calculated at 0.0%, 20.6%, and 22.8% effective tax rate of the pre-tax non-GAAP income before taxes for 2024, 2023, and 2022, respectively, and the GAAP income tax expense. 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, (c) net interest expense, (d) gains or losses on sale of businesses and assets, (e) gains or losses on insurance, (f) impairment of assets, (g) settlement of lawsuits, (h) gain on debt extinguishment, and (i) stock-based compensation. 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 the unleveraged performance return on our investments. Adjusted EBITDA multiple is also used as a target benchmark for our acquisitions of nightclubs.
We also use certain 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) (X: @RCIHHinc)
With more than 60 locations, RCI Hospitality Holdings, Inc., through its subsidiaries, is the country’s leading company in adult nightclubs and sports bars-restaurants. See all our brands at 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, including, but not limited to, the risks and uncertainties associated with (i) operating and managing an adult entertainment or restaurant 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 or restaurant 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, 2024, 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
3

RCI HOSPITALITY HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share, number of shares, and percentage data)
For the Three Months EndedFor the Twelve Months Ended
September 30, 2024September 30, 2023September 30, 2024September 30, 2023
Amount% of RevenueAmount% of RevenueAmount% of RevenueAmount% of Revenue
Revenues
Sales of alcoholic beverages$32,459 44.3 %$33,325 44.3 %$133,124 45.0 %$127,262 43.3 %
Sales of food and merchandise11,000 15.0 %11,149 14.8 %44,606 15.1 %43,906 14.9 %
Service revenues24,504 33.5 %25,661 34.1 %98,455 33.3 %103,577 35.3 %
Other5,271 7.2 %5,115 6.8 %19,419 6.6 %19,045 6.5 %
Total revenues73,234 100.0 %75,250 100.0 %295,604 100.0 %293,790 100.0 %
Operating expenses
Cost of goods sold
Alcoholic beverages sold5,783 17.8 %6,155 18.5 %24,228 18.2 %23,291 18.3 %
Food and merchandise sold4,132 37.6 %4,000 35.9 %16,360 36.7 %15,429 35.1 %
Service and other286 1.0 %191 0.6 %397 0.3 %282 0.2 %
Total cost of goods sold (exclusive of items shown below)10,201 13.9 %10,346 13.7 %40,985 13.9 %39,002 13.3 %
Salaries and wages20,878 28.5 %20,818 27.7 %84,177 28.5 %79,500 27.1 %
Selling, general and administrative24,761 33.8 %24,463 32.5 %99,672 33.7 %93,024 31.7 %
Depreciation and amortization3,757 5.1 %4,043 5.4 %15,395 5.2 %15,151 5.2 %
Impairments and other charges, net10,118 13.8 %9,936 13.2 %36,570 12.4 %15,629 5.3 %
Total operating expenses69,715 95.2 %69,606 92.5 %276,799 93.6 %242,306 82.5 %
Income from operations3,519 4.8 %5,644 7.5 %18,805 6.4 %51,484 17.5 %
Other income (expenses)
Interest expense(4,224)(5.8)%(4,246)(5.6)%(16,679)(5.6)%(15,926)(5.4)%
Interest income162 0.2 %120 0.2 %482 0.2 %388 0.1 %
Income before income taxes(543)(0.7)%1,518 2.0 %2,608 0.9 %35,946 12.2 %
Income tax expense (benefit)(788)(1.1)%(601)(0.8)%(410)(0.1)%6,846 2.3 %
Net income245 0.3 %2,119 2.8 %3,018 1.0 %29,100 9.9 %
Net loss (income) attributable to noncontrolling interests(1)— %72 0.1 %(7)— %146 — %
Net income attributable to RCIHH common shareholders$244 0.3 %$2,191 2.9 %$3,011 1.0 %$29,246 10.0 %
Earnings per share
Basic and diluted$0.03 $0.23 $0.33 $3.13 
Weighted average shares used in computing earnings per share
Basic and diluted9,006,0149,417,1669,250,2459,335,983

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RCI HOSPITALITY HOLDINGS, INC.
SEGMENT INFORMATION
(in thousands)
For the Three Months EndedFor the Twelve Months Ended
September 30, 2024September 30, 2023September 30, 2024September 30, 2023
Revenues
Nightclubs$60,636 $60,943 $243,864 $236,748 
Bombshells11,937 13,580 50,578 55,723 
Other661 727 1,162 1,319 
$73,234 $75,250 $295,604 $293,790 
Income (loss) from operations
Nightclubs$13,064 $12,060 $58,094 $73,187 
Bombshells(2,517)1,179 (10,646)6,502 
Other58 (793)(523)(1,446)
Corporate(7,086)(6,802)(28,120)(26,759)
$3,519 $5,644 $18,805 $51,484 

5

RCI HOSPITALITY HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
For the Three Months EndedFor the Twelve Months Ended
September 30, 2024September 30, 2023September 30, 2024September 30, 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net income$245 $2,119 $3,018 $29,100 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization3,757 4,043 15,395 15,151 
Impairment of assets12,553 9,336 38,517 12,629 
Deferred income tax benefit(31)(991)(6,450)(1,781)
Loss (gain) on sale of businesses and assets(2,331)2 (2,215)(870)
Amortization and writeoff of debt discount and issuance costs146 162 608 615 
Doubtful accounts expense on notes receivable(22)— — — 
Loss (gain) on insurance(522)14 (522)(77)
Noncash lease expense662 752 2,980 2,978 
Stock-based compensation470 471 1,882 2,588 
Changes in operating assets and liabilities, net of business acquisitions:
Receivables1,231 (3,863)4,283 (2,383)
Inventories(97)98 (309)177 
Prepaid expenses, other current, and other assets1,063 3,236 (2,421)(366)
Accounts payable, accrued, and other liabilities(1,473)(3,253)1,118 1,369 
Net cash provided by operating activities15,651 12,126 55,884 59,130 
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of businesses and assets19 1,434 1,969 4,245 
Proceeds from insurance1,367 (5)1,367 86 
Proceeds from notes receivable70 59 249 229 
Payments for property and equipment and intangible assets(5,381)(9,265)(24,600)(40,384)
Acquisition of businesses, net of cash acquired— — — (29,000)
Net cash used in investing activities(3,925)(7,777)(21,015)(64,824)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from debt obligations— — 22,657 11,595 
Payments on debt obligations(5,864)(4,219)(23,001)(15,650)
Purchase of treasury stock(7,831)(2,125)(20,606)(2,223)
Payment of dividends(628)(566)(2,302)(2,146)
Payment of loan origination costs— — (290)(239)
Share in return of investment by noncontrolling partner— — — (600)
Net cash used in financing activities(14,323)(6,910)(23,542)(9,263)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS(2,597)(2,561)11,327 (14,957)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD34,947 23,584 21,023 35,980 
CASH AND CASH EQUIVALENTS AT END OF PERIOD$32,350 $21,023 $32,350 $21,023 
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RCI HOSPITALITY HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
September 30, 2024September 30, 2023
ASSETS
Current assets
Cash and cash equivalents$32,350 $21,023 
Receivables, net5,563 9,846 
Current portion of notes receivable269 249 
Inventories4,676 4,412 
Prepaid expenses and other current assets4,427 1,943 
Total current assets47,285 37,473 
Property and equipment, net280,075 282,705 
Operating lease right-of-use assets, net26,231 34,931 
Notes receivable, net of current portion4,174 4,443 
Goodwill61,911 70,772 
Intangibles, net163,461 179,145 
Other assets1,227 1,415 
Total assets$584,364 $610,884 
LIABILITIES AND EQUITY
Current liabilities
Accounts payable$5,637 $6,111 
Accrued liabilities20,280 16,051 
Current portion of debt obligations, net18,871 22,843 
Current portion of operating lease liabilities3,290 2,977 
Total current liabilities48,078 47,982 
Deferred tax liability, net22,693 29,143 
Debt, net of current portion and debt discount and issuance costs219,326 216,908 
Operating lease liabilities, net of current portion30,759 35,175 
Other long-term liabilities398 352 
Total liabilities321,254 329,560 
Commitments and contingencies
Equity
Preferred stock— — 
Common stock90 94 
Additional paid-in capital61,511 80,437 
Retained earnings201,759 201,050 
Total RCIHH stockholders' equity263,360 281,581 
Noncontrolling interests(250)(257)
Total equity263,110 281,324 
Total liabilities and equity$584,364 $610,884 


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RCI HOSPITALITY HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES
(in thousands, except per share and percentage data)
For the Three Months EndedFor the Twelve Months Ended
September 30, 2024September 30, 2023September 30, 2024September 30, 2023
Reconciliation of GAAP net income to Adjusted EBITDA
Net income attributable to RCIHH common stockholders$244 $2,191 $3,011 $29,246 
Income tax expense (benefit)(788)(601)(410)6,846 
Interest expense, net4,062 4,126 16,197 15,538 
Depreciation and amortization3,757 4,043 15,395 15,151 
Impairment of assets12,553 9,336 38,517 12,629 
Settlement of lawsuits212 576 520 3,759 
Loss (gain) on sale of businesses and assets(2,320)10 (2,140)(682)
Loss (gain) on insurance(327)14 (327)(77)
Stock-based compensation470 471 1,882 2,588 
Adjusted EBITDA$17,863 $20,166 $72,645 $84,998 
Reconciliation of GAAP net income to non-GAAP net income
Net income attributable to RCIHH common stockholders$244 $2,191 $3,011 $29,246 
Amortization of intangibles597 806 2,494 3,528 
Impairment of assets12,553 9,336 38,517 12,629 
Settlement of lawsuits212 576 520 3,759 
Stock-based compensation470 471 1,882 2,588 
Loss (gain) on sale of businesses and assets(2,320)10 (2,140)(682)
Loss (gain) on insurance(327)14 (327)(77)
Change in deferred tax asset valuation allowance143 (176)143 (176)
Net income tax effect3,065 (2,810)(410)(5,068)
Non-GAAP net income$14,637 $10,418 $43,690 $45,747 
Reconciliation of GAAP diluted earnings per share to non-GAAP diluted earnings per share
Diluted shares9,006,0149,417,1669,250,2459,335,983
GAAP diluted earnings per share$0.03 $0.23 $0.33 $3.13 
Amortization of intangibles0.07 0.09 0.27 0.38 
Impairment of assets1.39 0.99 4.16 1.35 
Settlement of lawsuits0.02 0.06 0.06 0.40 
Stock-based compensation0.05 0.05 0.20 0.28 
Loss (gain) on sale of businesses and assets(0.26)— (0.23)(0.07)
Loss (gain) on insurance(0.04)— (0.04)(0.01)
Change in deferred tax asset valuation allowance0.02 (0.02)0.02 (0.02)
Net income tax effect0.34 (0.30)(0.04)(0.54)
Non-GAAP diluted earnings per share$1.63 $1.11 $4.72 $4.90 
Reconciliation of GAAP operating income to non-GAAP operating income
Income from operations$3,519 $5,644 $18,805 $51,484 
Amortization of intangibles597 806 2,494 3,528 
Impairment of assets12,553 9,336 38,517 12,629 
Settlement of lawsuits212 576 520 3,759 
Loss (gain) on sale of businesses and assets(2,320)10 (2,140)(682)
Loss (gain) on insurance(327)14 (327)(77)
Stock-based compensation470 471 1,882 2,588 
Non-GAAP operating income$14,704 $16,857 $59,751 $73,229 
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For the Three Months EndedFor the Twelve Months Ended
September 30, 2024September 30, 2023September 30, 2024September 30, 2023
Reconciliation of GAAP operating margin to non-GAAP operating margin
GAAP operating margin4.8 %7.5 %6.4 %17.5 %
Amortization of intangibles0.8 %1.1 %0.8 %1.2 %
Impairment of assets17.1 %12.4 %13.0 %4.3 %
Settlement of lawsuits0.3 %0.8 %0.2 %1.3 %
Loss (gain) on sale of businesses and assets(3.2)%— %(0.7)%(0.2)%
Loss (gain) on insurance(0.4)%— %(0.1)%— %
Stock-based compensation0.6 %0.6 %0.6 %0.9 %
Non-GAAP operating margin20.1 %22.4 %20.2 %24.9 %
Reconciliation of net cash provided by operating activities to free cash flow
Net cash provided by operating activities$15,651 $12,126 $55,884 $59,130 
Less: Maintenance capital expenditures2,483 1,005 7,463 5,954 
Free cash flow$13,168 $11,121 $48,421 $53,176 
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RCI HOSPITALITY HOLDINGS, INC.
NON-GAAP SEGMENT INFORMATION
($ in thousands)
For the Three Months Ended September 30, 2024For the Three Months Ended September 30, 2023
NightclubsBombshellsOtherCorporateTotalNightclubsBombshellsOtherCorporateTotal
Income (loss) from operations$13,064 $(2,517)$58 $(7,086)$3,519 $12,060 $1,179 $(793)$(6,802)$5,644 
Amortization of intangibles576 11 — 10 597 617 30 155 4 806 
Impairment of assets7,039 5,514 — — 12,553 8,522 — 814 — 9,336 
Settlement of lawsuits157 25 — 30 212 378 198 — — 576 
Stock-based compensation— — — 470 470 — — — 471 471 
Loss (gain) on sale of businesses and assets14 (2,332)— (2)(2,320)— 11 — (1)10 
Loss (gain) on insurance(327)— — — (327)— — — 14 14 
Non-GAAP operating income (loss)$20,523 $701 $58 $(6,578)$14,704 $21,577 $1,418 $176 $(6,314)$16,857 
GAAP operating margin21.5 %(21.1)%8.8 %(9.7)%4.8 %19.8 %8.7 %(109.1)%(9.0)%7.5 %
Non-GAAP operating margin33.8 %5.9 %8.8 %(9.0)%20.1 %35.4 %10.4 %24.2 %(8.4)%22.4 %
For the Twelve Months Ended September 30, 2024For the Twelve Months Ended September 30, 2023
NightclubsBombshellsOtherCorporateTotalNightclubsBombshellsOtherCorporateTotal
Income (loss) from operations$58,094 $(10,646)$(523)$(28,120)$18,805 $73,187 $6,502 $(1,446)$(26,759)$51,484 
Amortization of intangibles2,334 137 — 23 2,494 2,497 530 484 17 3,528 
Impairment of assets22,691 15,826 — — 38,517 11,815 — 814 — 12,629 
Settlement of lawsuits465 25 — 30 520 3,552 207 — — 3,759 
Stock-based compensation— — — 1,882 1,882 — — — 2,588 2,588 
Loss (gain) on sale of businesses and assets(56)(2,322)— 238 (2,140)(734)77 — (25)(682)
Gain on insurance(327)— — — (327)(48)— — (29)(77)
Non-GAAP operating income (loss)$83,201 $3,020 $(523)$(25,947)$59,751 $90,269 $7,316 $(148)$(24,208)$73,229 
GAAP operating margin23.8 %(21.0)%(45.0)%(9.5)%6.4 %30.9 %11.7 %(109.6)%(9.1)%17.5 %
Non-GAAP operating margin34.1 %6.0 %(45.0)%(8.8)%20.2 %38.1 %13.1 %(11.2)%(8.2)%24.9 %
10