8-K
Rci Hospitality Holdings, Inc. (RICK)
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): May 12, 2025
RCI HOSPITALITY HOLDINGS, INC.
(Exact Name of Registrant as Specified in Its Charter)
| Texas | 001-13992 | 76-0458229 |
|---|---|---|
| (State or Other Jurisdiction<br><br>of Incorporation) | (Commission<br><br>File Number) | (IRS Employer<br><br>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:
| o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a -12) |
| o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d -2(b)) |
| o | Pre-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 class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common stock, $0.01 par value | RICK | The 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 May 12, 2025, we issued a press release announcing results for the fiscal quarter ended March 31, 2025, and the filing of our quarterly report on Form 10-Q for that quarter. Also on May 12, 2025, 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 | Press release of RCI Hospitality Holdings, Inc. datedMay 12, 2025 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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: May 12, 2025 | By: | /s/ Eric Langan |
| Eric Langan | ||
| President and Chief Executive Officer |
3
Document
RCI Reports 2Q25 Results, Hosts X Spaces Call at 4:30 PM ET Today
HOUSTON—May 12, 2025—RCI Hospitality Holdings, Inc. (Nasdaq: RICK) today reported results for the fiscal 2025 second quarter ended March 31, 2025. The Company also filed its Form 10-Q today.
| Summary Financials (in millions, except EPS) | 2Q25 | 2Q24 | 6M25 | 6M24 |
|---|---|---|---|---|
| Total revenues | $65.9 | $72.3 | $137.4 | $146.2 |
| EPS | $0.36 | $0.08 | $1.38 | $0.85 |
| Non-GAAP EPS1 | $0.65 | $0.90 | $1.46 | $1.76 |
| Impairments and other charges (gains), net | $2.1 | $8.2 | $(0.1) | $8.2 |
| Net cash provided by operating activities | $8.5 | $10.8 | $21.9 | $24.5 |
| Free cash flow1 | $6.9 | $8.8 | $19.0 | $21.5 |
| Net income attributable to RCIHH common stockholders | $3.2 | $0.8 | $12.3 | $8.0 |
| Adjusted EBITDA1 | $14.2 | $17.2 | $29.9 | $34.7 |
| Weighted average shares used in computing EPS – basic and diluted | 8.86 | 9.35 | 8.89 | 9.36 |
1 See “Non-GAAP Financial Measures” below.
2Q25 Summary (Comparisons are to the year-ago period unless indicated otherwise)
Eric Langan, President and CEO, said: "As previously announced, revenues primarily reflect the sale/divestiture of five underperforming Bombshells segment locations and the effect of severe weather on company same-store sales in January and February, partially offset by improving trends in March. Profitability primarily reflects lower SSS, lower costs from the sale/divestiture of the Bombshells related units, and lower impairments. During and subsequent to 2Q25, we continued to make progress with our Back to Basics 5-Year Capital Allocation Plan, acquiring clubs, completing projects, and buying back shares."
Back to Basics 5-Year Capital Allocation Plan (FY25-29)
•2Q25: Acquired Flight Club, the premier gentlemen's club in the Detroit market ($8.0 million for the club and $3.0 million for the real estate).
•2Q25: Opened Bombshells in Denver, CO, and the rebranded/reformatted Chicas Locas in El Paso, TX.
•2Q25: Repurchased 56,875 common shares for $2.9 million ($50.92 average per share), with 8,832,125 shares outstanding at March 31, 2025.
•3Q25: Acquired Platinum West of West Columbia, SC, the only upscale adult nightclub in the central part of the state ($6.25 million for the club and $1.75 million for the real estate).
X Spaces Conference Call at 4:30 PM ET Today
•Hosted by RCI President and CEO Eric Langan, CFO Bradley Chhay, and Mark Moran of Equity Animal.
•Call link: https://x.com/i/spaces/1djGXVvkXgkxZ (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.
2Q25 Results (Comparisons are to the year-ago period unless indicated otherwise)
Nightclubs segment: Revenues of $57.5 million declined by 3.1%. Sales, which were affected by weather in January and February, reflected a 3.5% decline in same-store sales and the absence of Baby Dolls Fort Worth due to fire in July 2024, partially offset by five new and/or reformatted clubs not in SSS.2
By type of revenue, alcoholic beverages declined 5.3%, service declined 2.9%, and food, merchandise and other increased 2.4%. Impairments and other charges totaled $2.0 million compared to $8.2 million.
Operating income was $14.6 million (25.4% of segment revenues) compared to $11.0 million (18.6%). Results primarily reflected the impairment decline, partially offset by the sales decline. Non-GAAP operating income was $17.1 million (29.8% of segment revenues) compared to $19.8 million (33.4%). Non-GAAP results primarily reflected the sales decline.
Bombshells segment: Revenues of $8.2 million declined 35.6%. Sales, which were similarly affected by bad weather in January and February, reflected the sale/divestiture of five underperforming locations and a 13.4% decline in SSS, partially offset by two locations not in SSS (Stafford, TX, and Denver, CO).2
Operating loss was $227,000 (-2.8% of segment revenues) compared to income of $699,000 (5.5%). Non-GAAP operating loss was $67,000 (-0.8% of segment revenues) compared to income of $750,000 (5.9%). Results primarily reflected the sales decline from open locations and Bombshells Denver pre-opening costs, most of which were offset by the sale/divestiture of non-performing locations.
Corporate segment: Expenses totaled $5.5 million (8.4% of total revenues) compared to $6.8 million (9.4%). Non-GAAP expenses totaled $5.4 million (8.2% of total revenues) compared to $6.3 million (8.8%). The decline primarily reflected lower overhead from fewer locations.
Impairments and other charges (gains), net within consolidated operations totaled $2.1 million compared to $8.2 million.
Income tax expense was $1.1 million compared to $5,000. The effective tax rate was 25.1% compared to 0.7%.
Weighted average shares outstanding of 8.86 million declined 5.2% due to share buybacks.
Debt was $241.5 million at March 31, 2025 compared to $235.5 million at December 31, 2024. The increase primarily reflected Flight Club new acquisition related debt and Bombshells Rowlett and Lubbock construction financing, partially offset by scheduled pay downs.
2 See our April 8, 2025 news release on 2Q25 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:
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) settlement of lawsuits, (d) gains or losses on sale of businesses and assets, (e) gains or losses on insurance, 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 or loss attributable to RCIHH common stockholders and diluted earnings per share. Adjustment items are: (a) amortization of intangibles, (b) impairment of assets, (c) settlement of lawsuits, (d) gains or losses on sale of businesses and assets, (e) gains or losses on insurance, (f) stock-based compensation, (g) gains or losses on lease termination, and (h) the income tax effect of the above-described adjustments. Included in the income tax effect of the above adjustments is the net effect of the non-GAAP provision for income taxes, calculated at 18.1% and 18.4% effective tax rate of the pre-tax non-GAAP income before taxes for the six months ended March 31, 2025, and 2024, respectively, and the GAAP income tax expense (benefit). 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 or loss attributable to RCIHH common stockholders: (a) depreciation and amortization, (b) impairment of assets, (c) income tax expense, (d) net interest expense, (e) settlement of lawsuits, (f) gains or losses on sale of businesses and assets, (g) gains or losses on insurance, (h) stock-based compensation, and (i) gains or losses on lease termination. 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 our unleveraged performance return on our investments. Adjusted EBITDA is also the 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, and (vi) 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 Michael Wichman at 212-883-0655 or gfishman@pondel.com and mwichman@pondel.com.
| RCI HOSPITALITY HOLDINGS, INC. | |||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||||||||||||||||
| (in thousands, except per share, number of shares, and percentage data) | |||||||||||||||||||||||||||||
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||
| March 31, 2025 | March 31, 2024 | March 31, 2025 | March 31, 2024 | ||||||||||||||||||||||||||
| Amount | % of Revenue | Amount | % of Revenue | Amount | % of Revenue | Amount | % of Revenue | ||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||
| Sales of alcoholic beverages | $ | 28,866 | 43.8 | % | $ | 32,907 | 45.5 | % | $ | 61,054 | 44.4 | % | $ | 66,223 | 45.3 | % | |||||||||||||
| Sales of food and merchandise | 9,411 | 14.3 | % | 11,068 | 15.3 | % | 19,517 | 14.2 | % | 21,870 | 15.0 | % | |||||||||||||||||
| Service revenues | 22,912 | 34.8 | % | 23,564 | 32.6 | % | 47,093 | 34.3 | % | 48,683 | 33.3 | % | |||||||||||||||||
| Other | 4,687 | 7.1 | % | 4,744 | 6.6 | % | 9,695 | 7.1 | % | 9,414 | 6.4 | % | |||||||||||||||||
| Total revenues | 65,876 | 100.0 | % | 72,283 | 100.0 | % | 137,359 | 100.0 | % | 146,190 | 100.0 | % | |||||||||||||||||
| Operating expenses | |||||||||||||||||||||||||||||
| Cost of goods sold | |||||||||||||||||||||||||||||
| Alcoholic beverages sold | 5,204 | 18.0 | % | 5,891 | 17.9 | % | 11,050 | 18.1 | % | 12,172 | 18.4 | % | |||||||||||||||||
| Food and merchandise sold | 3,182 | 33.8 | % | 3,993 | 36.1 | % | 6,745 | 34.6 | % | 8,031 | 36.7 | % | |||||||||||||||||
| Service and other | 25 | 0.1 | % | 35 | 0.1 | % | 97 | 0.2 | % | 75 | 0.1 | % | |||||||||||||||||
| Total cost of goods sold (exclusive of items shown below) | 8,411 | 12.8 | % | 9,919 | 13.7 | % | 17,892 | 13.0 | % | 20,278 | 13.9 | % | |||||||||||||||||
| Salaries and wages | 20,491 | 31.1 | % | 20,975 | 29.0 | % | 41,055 | 29.9 | % | 42,307 | 28.9 | % | |||||||||||||||||
| Selling, general and administrative | 22,900 | 34.8 | % | 24,653 | 34.1 | % | 49,107 | 35.8 | % | 49,854 | 34.1 | % | |||||||||||||||||
| Depreciation and amortization | 3,776 | 5.7 | % | 3,884 | 5.4 | % | 7,345 | 5.3 | % | 7,737 | 5.3 | % | |||||||||||||||||
| Impairments and other charges (gains), net | 2,127 | 3.2 | % | 8,195 | 11.3 | % | (117) | (0.1) | % | 8,192 | 5.6 | % | |||||||||||||||||
| Total operating expenses | 57,705 | 87.6 | % | 67,626 | 93.6 | % | 115,282 | 83.9 | % | 128,368 | 87.8 | % | |||||||||||||||||
| Income from operations | 8,171 | 12.4 | % | 4,657 | 6.4 | % | 22,077 | 16.1 | % | 17,822 | 12.2 | % | |||||||||||||||||
| Other income (expenses) | |||||||||||||||||||||||||||||
| Interest expense | (4,048) | (6.1) | % | (3,999) | (5.5) | % | (8,200) | (6.0) | % | (8,215) | (5.6) | % | |||||||||||||||||
| Interest income | 139 | 0.2 | % | 96 | 0.1 | % | 318 | 0.2 | % | 190 | 0.1 | % | |||||||||||||||||
| Gain on lease termination | — | — | % | — | — | % | 979 | 0.7 | % | — | — | % | |||||||||||||||||
| Income before income taxes | 4,262 | 6.5 | % | 754 | 1.0 | % | 15,174 | 11.0 | % | 9,797 | 6.7 | % | |||||||||||||||||
| Income tax expense | 1,068 | 1.6 | % | 5 | — | % | 2,915 | 2.1 | % | 1,804 | 1.2 | % | |||||||||||||||||
| Net income | 3,194 | 4.8 | % | 749 | 1.0 | % | 12,259 | 8.9 | % | 7,993 | 5.5 | % | |||||||||||||||||
| Net income attributable to noncontrolling interests | 37 | 0.1 | % | 25 | — | % | (4) | — | % | 7 | — | % | |||||||||||||||||
| Net income attributable to RCIHH common shareholders | $ | 3,231 | 4.9 | % | $ | 774 | 1.1 | % | $ | 12,255 | 8.9 | % | $ | 8,000 | 5.5 | % | |||||||||||||
| Earnings per share | |||||||||||||||||||||||||||||
| Basic and diluted | $ | 0.36 | $ | 0.08 | $ | 1.38 | $ | 0.85 | |||||||||||||||||||||
| Weighted average shares used in computing earnings per share | |||||||||||||||||||||||||||||
| Basic and diluted | 8,861,854 | 9,350,292 | 8,891,638 | 9,358,768 | |||||||||||||||||||||||||
| RCI HOSPITALITY HOLDINGS, INC. | |||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||||||||||||
| SEGMENT INFORMATION | |||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||
| March 31, 2025 | March 31, 2024 | March 31, 2025 | March 31, 2024 | ||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||
| Nightclubs | $ | 57,541 | $ | 59,372 | $ | 119,265 | $ | 120,405 | |||||||||||||||||||||
| Bombshells | 8,229 | 12,771 | 17,816 | 25,502 | |||||||||||||||||||||||||
| Other | 106 | 140 | 278 | 283 | |||||||||||||||||||||||||
| $ | 65,876 | $ | 72,283 | $ | 137,359 | $ | 146,190 | ||||||||||||||||||||||
| Income (loss) from operations | |||||||||||||||||||||||||||||
| Nightclubs | $ | 14,603 | $ | 11,021 | $ | 35,485 | $ | 31,390 | |||||||||||||||||||||
| Bombshells | (227) | 699 | 1,744 | 785 | |||||||||||||||||||||||||
| Other | (680) | (277) | (851) | (473) | |||||||||||||||||||||||||
| Corporate | (5,525) | (6,786) | (14,301) | (13,880) | |||||||||||||||||||||||||
| $ | 8,171 | $ | 4,657 | $ | 22,077 | $ | 17,822 | ||||||||||||||||||||||
| RCI HOSPITALITY HOLDINGS, INC. | |||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||
| March 31, 2025 | March 31, 2024 | March 31, 2025 | March 31, 2024 | ||||||||||||||||||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||||||||||||||
| Net income | $ | 3,194 | $ | 749 | $ | 12,259 | $ | 7,993 | |||||||||||||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||||||||||||||
| Depreciation and amortization | 3,776 | 3,884 | 7,345 | 7,737 | |||||||||||||||||||||||||
| Impairment of assets | 1,780 | 8,033 | 1,780 | 8,033 | |||||||||||||||||||||||||
| Deferred income tax benefit | (853) | (1,911) | (1,242) | (1,911) | |||||||||||||||||||||||||
| Loss (gain) on sale of businesses and assets | 215 | 40 | (1,248) | 37 | |||||||||||||||||||||||||
| Amortization and writeoff of debt discount and issuance costs | 227 | 149 | 290 | 312 | |||||||||||||||||||||||||
| Doubtful accounts expense on notes receivable | — | — | — | 22 | |||||||||||||||||||||||||
| Gain on insurance | — | — | (1,150) | — | |||||||||||||||||||||||||
| Noncash lease expense | 668 | 773 | 1,326 | 1,535 | |||||||||||||||||||||||||
| Stock-based compensation | 118 | 471 | 588 | 941 | |||||||||||||||||||||||||
| Changes in operating assets and liabilities, net of business acquisitions: | |||||||||||||||||||||||||||||
| Receivables | (659) | (162) | 1,714 | 1,067 | |||||||||||||||||||||||||
| Inventories | 68 | 76 | 64 | (142) | |||||||||||||||||||||||||
| Prepaid expenses, other current, and other assets | 68 | 2,609 | (530) | (6,420) | |||||||||||||||||||||||||
| Accounts payable, accrued, and other liabilities | (55) | (3,875) | 695 | 5,265 | |||||||||||||||||||||||||
| Net cash provided by operating activities | 8,547 | 10,836 | 21,891 | 24,469 | |||||||||||||||||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||||||||||||||||||||
| Proceeds from sale of businesses and assets | 956 | — | 1,085 | — | |||||||||||||||||||||||||
| Proceeds from insurance | — | — | 1,150 | — | |||||||||||||||||||||||||
| Proceeds from notes receivable | 76 | 61 | 147 | 116 | |||||||||||||||||||||||||
| Payments for property and equipment and intangible assets | (2,854) | (7,667) | (8,608) | (12,802) | |||||||||||||||||||||||||
| Acquisition of businesses, net of cash acquired | (6,000) | — | (6,000) | — | |||||||||||||||||||||||||
| Net cash used in investing activities | (7,822) | (7,606) | (12,226) | (12,686) | |||||||||||||||||||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||||||||||||||||||||
| Proceeds from debt obligations | 5,433 | 1,956 | 8,396 | 2,657 | |||||||||||||||||||||||||
| Payments on debt obligations | (4,627) | (4,278) | (10,321) | (10,630) | |||||||||||||||||||||||||
| Purchase of treasury stock | (2,896) | (1,530) | (6,114) | (3,602) | |||||||||||||||||||||||||
| Payment of dividends | (619) | (560) | (1,242) | (1,122) | |||||||||||||||||||||||||
| Payment of loan origination costs | (71) | — | (71) | (136) | |||||||||||||||||||||||||
| Net cash used in financing activities | (2,780) | (4,412) | (9,352) | (12,833) | |||||||||||||||||||||||||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (2,055) | (1,182) | 313 | (1,050) | |||||||||||||||||||||||||
| CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 34,718 | 21,155 | 32,350 | 21,023 | |||||||||||||||||||||||||
| CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 32,663 | $ | 19,973 | $ | 32,663 | $ | 19,973 | |||||||||||||||||||||
| RCI HOSPITALITY HOLDINGS, INC. | |||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | |||||||||||||||||||||||
| CONSOLIDATED BALANCE SHEETS | |||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||
| March 31, 2025 | September 30, 2024 | March 31, 2024 | |||||||||||||||||||||||||||
| ASSETS | |||||||||||||||||||||||||||||
| Current assets | |||||||||||||||||||||||||||||
| Cash and cash equivalents | $ | 32,663 | $ | 32,350 | $ | 19,973 | |||||||||||||||||||||||
| Receivables, net | 4,174 | 5,832 | 9,044 | ||||||||||||||||||||||||||
| Inventories | 4,645 | 4,676 | 4,554 | ||||||||||||||||||||||||||
| Prepaid expenses and other current assets | 4,071 | 4,427 | 8,387 | ||||||||||||||||||||||||||
| Assets held for sale | — | — | 74 | ||||||||||||||||||||||||||
| Total current assets | 45,553 | 47,285 | 42,032 | ||||||||||||||||||||||||||
| Property and equipment, net | 283,442 | 280,075 | 288,224 | ||||||||||||||||||||||||||
| Operating lease right-of-use assets, net | 24,905 | 26,231 | 33,396 | ||||||||||||||||||||||||||
| Notes receivable, net of current portion | 4,031 | 4,174 | 4,289 | ||||||||||||||||||||||||||
| Goodwill | 62,524 | 61,911 | 67,862 | ||||||||||||||||||||||||||
| Intangibles, net | 167,383 | 163,461 | 172,728 | ||||||||||||||||||||||||||
| Other assets | 1,918 | 1,227 | 1,362 | ||||||||||||||||||||||||||
| Total assets | $ | 589,756 | $ | 584,364 | $ | 609,893 | |||||||||||||||||||||||
| LIABILITIES AND EQUITY | |||||||||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||||||||
| Accounts payable | $ | 5,652 | $ | 5,637 | $ | 5,632 | |||||||||||||||||||||||
| Accrued liabilities | 18,161 | 20,280 | 22,597 | ||||||||||||||||||||||||||
| Current portion of debt obligations, net | 19,737 | 18,871 | 25,072 | ||||||||||||||||||||||||||
| Current portion of operating lease liabilities | 3,073 | 3,290 | 3,098 | ||||||||||||||||||||||||||
| Total current liabilities | 46,623 | 48,078 | 56,399 | ||||||||||||||||||||||||||
| Deferred tax liability, net | 21,451 | 22,693 | 27,232 | ||||||||||||||||||||||||||
| Debt, net of current portion and debt discount and issuance costs | 221,725 | 219,326 | 206,853 | ||||||||||||||||||||||||||
| Operating lease liabilities, net of current portion | 26,677 | 30,759 | 33,593 | ||||||||||||||||||||||||||
| Other long-term liabilities | 4,741 | 398 | 317 | ||||||||||||||||||||||||||
| Total liabilities | 321,217 | 321,254 | 324,394 | ||||||||||||||||||||||||||
| Commitments and contingencies | |||||||||||||||||||||||||||||
| Equity | |||||||||||||||||||||||||||||
| Preferred stock | — | — | — | ||||||||||||||||||||||||||
| Common stock | 88 | 90 | 93 | ||||||||||||||||||||||||||
| Additional paid-in capital | 55,925 | 61,511 | 77,742 | ||||||||||||||||||||||||||
| Retained earnings | 212,772 | 201,759 | 207,928 | ||||||||||||||||||||||||||
| Total RCIHH stockholders' equity | 268,785 | 263,360 | 285,763 | ||||||||||||||||||||||||||
| Noncontrolling interests | (246) | (250) | (264) | ||||||||||||||||||||||||||
| Total equity | 268,539 | 263,110 | 285,499 | ||||||||||||||||||||||||||
| Total liabilities and equity | $ | 589,756 | $ | 584,364 | $ | 609,893 | |||||||||||||||||||||||
| RCI HOSPITALITY HOLDINGS, INC. | |||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||||||||||||
| NON-GAAP FINANCIAL MEASURES | |||||||||||||||||||||||||||||
| (in thousands, except per share, number of shares, and percentage data) | |||||||||||||||||||||||||||||
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||
| March 31, 2025 | March 31, 2024 | March 31, 2025 | March 31, 2024 | ||||||||||||||||||||||||||
| Reconciliation of GAAP net income to Adjusted EBITDA | |||||||||||||||||||||||||||||
| Net income attributable to RCIHH common stockholders | $ | 3,231 | $ | 774 | $ | 12,255 | $ | 8,000 | |||||||||||||||||||||
| Income tax expense | 1,068 | 5 | 2,915 | 1,804 | |||||||||||||||||||||||||
| Interest expense, net | 3,909 | 3,903 | 7,882 | 8,025 | |||||||||||||||||||||||||
| Depreciation and amortization | 3,776 | 3,884 | 7,345 | 7,737 | |||||||||||||||||||||||||
| Impairment of assets | 1,780 | 8,033 | 1,780 | 8,033 | |||||||||||||||||||||||||
| Settlement of lawsuits | 127 | 167 | 306 | 167 | |||||||||||||||||||||||||
| Loss (gain) on sale of businesses and assets | 220 | (5) | (1,186) | (8) | |||||||||||||||||||||||||
| Gain on insurance | — | — | (1,017) | — | |||||||||||||||||||||||||
| Stock-based compensation | 118 | 471 | 588 | 941 | |||||||||||||||||||||||||
| Gain on lease termination | — | — | (979) | — | |||||||||||||||||||||||||
| Adjusted EBITDA | $ | 14,229 | $ | 17,232 | $ | 29,889 | $ | 34,699 | |||||||||||||||||||||
| Reconciliation of GAAP net income to non-GAAP net income | |||||||||||||||||||||||||||||
| Net income attributable to RCIHH common stockholders | $ | 3,231 | $ | 774 | $ | 12,255 | $ | 8,000 | |||||||||||||||||||||
| Amortization of intangibles | 577 | 640 | 1,157 | 1,299 | |||||||||||||||||||||||||
| Impairment of assets | 1,780 | 8,033 | 1,780 | 8,033 | |||||||||||||||||||||||||
| Settlement of lawsuits | 127 | 167 | 306 | 167 | |||||||||||||||||||||||||
| Stock-based compensation | 118 | 471 | 588 | 941 | |||||||||||||||||||||||||
| Loss (gain) on sale of businesses and assets | 220 | (5) | (1,186) | (8) | |||||||||||||||||||||||||
| Gain on insurance | — | — | (1,017) | — | |||||||||||||||||||||||||
| Gain on lease termination | — | — | (979) | — | |||||||||||||||||||||||||
| Net income tax effect | (263) | (1,701) | 47 | (1,921) | |||||||||||||||||||||||||
| Non-GAAP net income | $ | 5,790 | $ | 8,379 | $ | 12,951 | $ | 16,511 | |||||||||||||||||||||
| Reconciliation of GAAP diluted earnings per share to non-GAAP diluted earnings per share | |||||||||||||||||||||||||||||
| Diluted shares | 8,861,854 | 9,350,292 | 8,891,638 | 9,358,768 | |||||||||||||||||||||||||
| GAAP diluted earnings per share | $ | 0.36 | $ | 0.08 | $ | 1.38 | $ | 0.85 | |||||||||||||||||||||
| Amortization of intangibles | 0.07 | 0.07 | 0.13 | 0.14 | |||||||||||||||||||||||||
| Impairment of assets | 0.20 | 0.86 | 0.20 | 0.86 | |||||||||||||||||||||||||
| Settlement of lawsuits | 0.01 | 0.02 | 0.03 | 0.02 | |||||||||||||||||||||||||
| Stock-based compensation | 0.01 | 0.05 | 0.07 | 0.10 | |||||||||||||||||||||||||
| Loss (gain) on sale of businesses and assets | 0.02 | 0.00 | (0.13) | 0.00 | |||||||||||||||||||||||||
| Gain on insurance | 0.00 | 0.00 | (0.11) | 0.00 | |||||||||||||||||||||||||
| Gain on lease termination | 0.00 | 0.00 | (0.11) | 0.00 | |||||||||||||||||||||||||
| Net income tax effect | (0.03) | (0.18) | 0.01 | (0.21) | |||||||||||||||||||||||||
| Non-GAAP diluted earnings per share | $ | 0.65 | $ | 0.90 | $ | 1.46 | $ | 1.76 | |||||||||||||||||||||
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||||||||
| March 31, 2025 | March 31, 2024 | March 31, 2025 | March 31, 2024 | ||||||||||||||||||||||||||
| Reconciliation of GAAP operating income to non-GAAP operating income | |||||||||||||||||||||||||||||
| Income from operations | $ | 8,171 | $ | 4,657 | $ | 22,077 | $ | 17,822 | |||||||||||||||||||||
| Amortization of intangibles | 577 | 640 | 1,157 | 1,299 | |||||||||||||||||||||||||
| Impairment of assets | 1,780 | 8,033 | 1,780 | 8,033 | |||||||||||||||||||||||||
| Settlement of lawsuits | 127 | 167 | 306 | 167 | |||||||||||||||||||||||||
| Stock-based compensation | 118 | 471 | 588 | 941 | |||||||||||||||||||||||||
| Loss (gain) on sale of businesses and assets | 220 | (5) | (1,186) | (8) | |||||||||||||||||||||||||
| Gain on insurance | — | — | (1,017) | — | |||||||||||||||||||||||||
| Non-GAAP operating income | $ | 10,993 | $ | 13,963 | $ | 23,705 | $ | 28,254 | |||||||||||||||||||||
| Reconciliation of GAAP operating margin to non-GAAP operating margin | |||||||||||||||||||||||||||||
| GAAP operating margin | 12.4 | % | 6.4 | % | 16.1 | % | 12.2 | % | |||||||||||||||||||||
| Amortization of intangibles | 0.9 | % | 0.9 | % | 0.8 | % | 0.9 | % | |||||||||||||||||||||
| Impairment of assets | 2.7 | % | 11.1 | % | 1.3 | % | 5.5 | % | |||||||||||||||||||||
| Settlement of lawsuits | 0.2 | % | 0.2 | % | 0.2 | % | 0.1 | % | |||||||||||||||||||||
| Stock-based compensation | 0.2 | % | 0.7 | % | 0.4 | % | 0.6 | % | |||||||||||||||||||||
| Loss (gain) on sale of businesses and assets | 0.3 | % | 0.0 | % | (0.9) | % | 0.0 | % | |||||||||||||||||||||
| Gain on insurance | 0.0 | % | 0.0 | % | (0.7) | % | 0.0 | % | |||||||||||||||||||||
| Non-GAAP operating margin | 16.7 | % | 19.3 | % | 17.3 | % | 19.3 | % | |||||||||||||||||||||
| Reconciliation of net cash provided by operating activities to free cash flow | |||||||||||||||||||||||||||||
| Net cash provided by operating activities | $ | 8,547 | $ | 10,836 | $ | 21,891 | $ | 24,469 | |||||||||||||||||||||
| Less: Maintenance capital expenditures | 1,611 | 2,011 | 2,887 | 2,994 | |||||||||||||||||||||||||
| Free cash flow | $ | 6,936 | $ | 8,825 | $ | 19,004 | $ | 21,475 | |||||||||||||||||||||
| RCI HOSPITALITY HOLDINGS, INC. | |||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| NON-GAAP SEGMENT INFORMATION | |||||||||||||||||||||||||||||
| ( in thousands) | |||||||||||||||||||||||||||||
| For the Three Months Ended March 31, 2024 | |||||||||||||||||||||||||||||
| Bombshells | Other | Corporate | Total | Nightclubs | Bombshells | Other | Corporate | Total | |||||||||||||||||||||
| Income (loss) from operations | 14,603 | $ | (227) | $ | (680) | $ | (5,525) | $ | 8,171 | $ | 11,021 | $ | 699 | $ | (277) | $ | (6,786) | $ | 4,657 | ||||||||||
| Amortization of intangibles | 1 | — | 4 | 577 | 589 | 47 | — | 4 | 640 | ||||||||||||||||||||
| Impairment of assets | — | — | — | 1,780 | 8,033 | — | — | — | 8,033 | ||||||||||||||||||||
| Settlement of lawsuits | 30 | — | — | 127 | 167 | — | — | — | 167 | ||||||||||||||||||||
| Stock-based compensation | — | — | 118 | 118 | — | — | — | 471 | 471 | ||||||||||||||||||||
| Loss (gain) on sale of businesses and assets | 129 | — | (2) | 220 | 7 | 4 | — | (16) | (5) | ||||||||||||||||||||
| Non-GAAP operating income (loss) | 17,145 | $ | (67) | $ | (680) | $ | (5,405) | $ | 10,993 | $ | 19,817 | $ | 750 | $ | (277) | $ | (6,327) | $ | 13,963 | ||||||||||
| GAAP operating margin | % | (2.8) | % | (641.5) | % | (8.4) | % | 12.4 | % | 18.6 | % | 5.5 | % | (197.9) | % | (9.4) | % | 6.4 | % | ||||||||||
| Non-GAAP operating margin | % | (0.8) | % | (641.5) | % | (8.2) | % | 16.7 | % | 33.4 | % | 5.9 | % | (197.9) | % | (8.8) | % | 19.3 | % | ||||||||||
| For the Six Months Ended March 31, 2024 | |||||||||||||||||||||||||||||
| Bombshells | Other | Corporate | Total | Nightclubs | Bombshells | Other | Corporate | Total | |||||||||||||||||||||
| Income (loss) from operations | 35,485 | $ | 1,744 | $ | (851) | $ | (14,301) | $ | 22,077 | $ | 31,390 | $ | 785 | $ | (473) | $ | (13,880) | $ | 17,822 | ||||||||||
| Amortization of intangibles | 2 | — | 9 | 1,157 | 1,180 | 110 | — | 9 | 1,299 | ||||||||||||||||||||
| Impairment of assets | — | — | — | 1,780 | 8,033 | — | — | — | 8,033 | ||||||||||||||||||||
| Settlement of lawsuits | 30 | — | — | 306 | 167 | — | — | — | 167 | ||||||||||||||||||||
| Stock-based compensation | — | — | 588 | 588 | — | — | — | 941 | 941 | ||||||||||||||||||||
| Loss (gain) on sale of businesses and assets | (1,201) | — | (94) | (1,186) | 6 | 4 | — | (18) | (8) | ||||||||||||||||||||
| Gain on insurance | — | — | — | (1,017) | — | — | — | — | — | ||||||||||||||||||||
| Non-GAAP operating income (loss) | 37,779 | $ | 575 | $ | (851) | $ | (13,798) | $ | 23,705 | $ | 40,776 | $ | 899 | $ | (473) | $ | (12,948) | $ | 28,254 | ||||||||||
| GAAP operating margin | % | 9.8 | % | (306.1) | % | (10.4) | % | 16.1 | % | 26.1 | % | 3.1 | % | (167.1) | % | (9.5) | % | 12.2 | % | ||||||||||
| Non-GAAP operating margin | % | 3.2 | % | (306.1) | % | (10.0) | % | 17.3 | % | 33.9 | % | 3.5 | % | (167.1) | % | (8.9) | % | 19.3 | % |
All values are in US Dollars.
10