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Last updated on April 17, 2014 at 1:21 EDT

Rick’s Cabaret International, Inc. Reports Total Revenues Of $23.9 Million For Its Third Quarter Ended June 30, 2012, With Net Income Of $1.8 Million

August 9, 2012

HOUSTON, Aug. 9, 2012 /PRNewswire/ — Rick’s Cabaret International, Inc., (NASDAQ:RICK) the nation’s premier group of upscale gentlemen’s clubs, reported consolidated total revenues of $23.9 million for its third quarter ended June 30, 2012, an increase of 15 percent compared with the $20.8 million reported for the period in 2011.

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The company said net income was $1.8 million compared with $888,000 in the same period in 2011, with earnings of 19 cents per share in the third quarter this year compared with nine cents last year.

Eric Langan, President and CEO of Rick’s Cabaret International, will discuss the results in a conference call at 4:30 pm EDT today. The call will be webcast by VCall and can be accessed at the Rick’s Cabaret investor website, www.ricksinvestor.com or www.investorcalendar.com. The domestic toll free participant dial-in number is 877-407-8033; international is 201-689-8033. The toll free replay numbers are domestic 877-660-6853; international 201-612-7415. Replay access information: Account 286 and Conference ID 398195. The replay will be available until Sept. 9, 2012.

The increase in revenues was driven by strong results from Tootsie’s Cabaret in Miami; Club Onyx locations in Philadelphia and Charlotte; a newly acquired club in Dallas; and strong sales increases at the Dallas-Ft. Worth Airport location, formerly a BYOB club that is now selling liquor. Total same-location-same-period club sales were up five percent to $21.3 million compared with $20.3 million last year.

Mr. Langan said earnings and operating margins were impacted by increases in cost of goods sold due to more clubs selling alcohol this year; higher depreciation because of the addition of new real estate; the one-time loss on the sale of assets; and higher legal costs plus the settlement of a lawsuit. Some of these factors also caused lower Adjusted EBITDA* for the third quarter, which was $5.4 million this year, compared with $6.0 million last year. The Form 10Q available on the company’s www.ricksinvestor.com website provides a comprehensive view of these issues in its Management Discussion & Analysis section.

*Adjusted EBITDA is a financial statement measure that was not derived in accordance with GAAP. We use adjusted EBITDA (earnings from continuing operations before interest expense, income taxes, depreciation, amortization and impairment charges) as a non-GAAP performance measure. In calculating adjusted EBITDA, we exclude our largest recurring non-cash charge, depreciation, amortization and impairment charges. 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. Also, we exclude interest cost in our calculation of adjusted EBITDA. 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.

                                                                           RICK'S CABARET INTERNATIONAL, INC. AND SUBSIDIARIES
                                                                                    CONSOLIDATED STATEMENTS OF INCOME

                                     (in thousands, except                  FOR THE THREE MONTHS                   FOR THE NINE MONTHS
                                        per share data)                        ENDED JUNE 30,                         ENDED JUNE 30,
                                         --------------

                                                                                                2012                                  2011     2012     2011
                                                                                                ----                                  ----     ----     ----
                                                                                 (UNAUDITED)                           (UNAUDITED)

    Revenues:
    Sales of alcoholic beverages                                                              $9,711                                $8,149  $29,033  $24,312
    Sales of food and merchandise                                                              2,286                                 1,891    6,619    5,469
    Service revenues                                                                          10,576                                 9,553   31,743   28,637
    Internet revenues                                                                             97                                   113      298      359
    Media revenues                                                                               137                                   176      496      585
    Other                                                                                      1,114                                   911    3,164    2,678
                                                                                               -----                                   ---    -----    -----
    Total revenues                                                                            23,921                                20,793   71,353   62,040

    Operating expenses:
    Cost of goods sold                                                                         3,279                                 2,710    9,601    7,793
    Salaries and wages                                                                         5,299                                 4,683   15,428   13,503
    Stock compensation                                                                            12                                     -       33        -
    Other general and administrative:
    Taxes and permits                                                                          3,618                                 3,096   11,018    9,316
    Charge card fees                                                                             361                                   405    1,042    1,047
    Rent                                                                                         726                                   756    2,150    2,305
    Legal and professional                                                                       992                                   635    2,433    1,547
    Advertising and marketing                                                                    959                                   838    2,994    2,651
    Insurance                                                                                    387                                   300    1,027      849
    Utilities                                                                                    454                                   394    1,264    1,140
    Depreciation and amortization                                                              1,398                                   970    3,708    2,825
    Settlement of lawsuits                                                                       200                                     -    2,031        -
    Loss on sale of assets                                                                       332                                     -      332        -
    Other                                                                                      1,867                                 1,626    5,432    4,646
                                                                                               -----                                 -----    -----    -----
    Total operating expenses                                                                  19,884                                16,413   58,493   47,622
                                                                                              ------                                ------   ------   ------
    Operating income                                                                           4,037                                 4,380   12,860   14,418

    Other income (expense):
    Interest income and other                                                                     (2)                                    2        2       57
    Interest expense                                                                          (1,098)                               (1,033)  (3,178)  (3,170)
    Gain on settlement of debt                                                                     -                                   903        -      903
    Gain (loss) on change in fair value                                                          (17)                                 (216)     120      266
    of derivative instruments
    Income from continuing operations before income taxes                                      2,920                                 4,036    9,804   12,474
    Income taxes                                                                               1,022                                 1,507    3,366    4,250
                                                                                               -----                                 -----    -----    -----
    Income from continuing operations                                                          1,898                                 2,529    6,438    8,224
    Loss from discontinued operations, net of income taxes                                       (22)                               (1,588)    (155)  (2,179)
                                                                                                 ---                                ------     ----   ------
    Net income                                                                                 1,876                                   941    6,283    6,045
    Less: net income attributable to noncontrolling  interests                                   (53)                                  (53)    (159)    (159)
                                                                                                 ---                                   ---     ----     ----
    Net income attributable to Rick's Cabaret International, Inc.                             $1,823                                  $888   $6,124   $5,886
                                                                                              ======                                  ====   ======   ======

    Basic earnings (loss) per share attributable to Rick's shareholders:
    Income from continuing operations                                                          $0.19                                 $0.25    $0.65    $0.81
    Loss from discontinued operations                                                         $(0.00)                               $(0.16)  $(0.02)  $(0.22)
                                                                                              ------                                ------   ------   ------
    Net income                                                                                 $0.19                                 $0.09    $0.63    $0.59
                                                                                               =====                                 =====    =====    =====
    Diluted earnings (loss) per share attributable to Rick's shareholders:
    Income from continuing operations                                                          $0.19                                 $0.25    $0.65    $0.81
    Loss from discontinued operations                                                         $(0.00)                               $(0.16)  $(0.02)  $(0.22)
                                                                                              ------                                ------   ------   ------
    Net income                                                                                 $0.19                                 $0.09    $0.63    $0.59
                                                                                               =====                                 =====    =====    =====
    Weighted average number of common  shares outstanding:
    Basic                                                                                      9,725                                 9,924    9,710    9,968
    Diluted                                                                                    9,731                                 9,941    9,717    9,983

About Rick’s Cabaret: Rick’s Cabaret International, Inc. (NASDAQ: RICK) is home to upscale adult nightclubs serving primarily businessmen and professionals that offer live entertainment, dining and bar operations. Nightclubs in New York City, Miami, Philadelphia, Charlotte, Dallas/Ft. Worth, Houston, Minneapolis, Indianapolis and other cities as “Rick’s Cabaret,” “XTC,” “Club Onyx” and “Tootsie’s Cabaret” and other brand names. Sexual contact is not permitted at any locations. Rick’s Cabaret also operates a media division, ED Publications, and owns the adult Internet membership Website 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 NASDAQ under the symbol RICK. For further information contact ir@ricks.com or visit www.ricksinvestor.com. Twitter: @rickscabaret; Facebook: http://www.facebook.com/rickscabaretintl.

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 in this press release, 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.ricksinvestor.com.

SOURCE Rick’s Cabaret International, Inc.


Source: PR Newswire