Net Income Swings to $7.8 million from Loss of $8.0
million in 2010; Per Share Earnings Rise to $.79 vs. a Loss of $.82
International, Inc., the nation’s leading group of
upscale adult nightclubs, today reported its revenue for the year ended Sept.
30, 2011 rose to $83.5 million, a 12.7 percent increase over the $74.0 million
in 2010. Net income was $7.8 million, compared with a loss of $8.0 million in
the previous year. Fully diluted earnings per share were $.79 vs. a loss of $.82
“Our strong fiscal 2011 results reflect a return to more
normal growth patterns for the company across the board and the fact that we are
no longer impacted by the drag from the now discontinued operation in Las
Vegas,” said Eric Langan, President and CEO of Rick’s Cabaret, which
operates 23 clubs around the country. “We are continuing the momentum we built
in fiscal 2011 and we look forward to another strong year in 2012.”
Mr. Langan said the revenue improvement included a 4.9
percent increase in sales at clubs open more than one year, particularly the New
York City location, and about $6.1million from new clubs acquired in 2010 and
2011. The results also reflect the closing of the Las Vegas club in April 2011,
which was shut after determining it could not be made viable in the foreseeable
In a Form 10-K filed with the SEC today, the company also
reported results for its fourth quarter ending September 30th, showing revenues
of $21.5 million compared with $19.1 million for the same quarter in the prior
year; net income of $2.0 million, compared with a loss of $12.5 million in 2010;
fully diluted earnings per share of 20 cents, versus a loss of $1.24 last year.
Key factors in the full fiscal year 2011 results include:
Adjusted EBITDA (earnings before interest expense, income
taxes, depreciation, amortization, and impairment charges) was $23.6 million
in 2011, compared with $17.9 million last year. The company uses non-GAAP
adjusted EBITDA as a core operational performance measurement it feels more
accurately reflects the performance of the company in part because it allows
companies to express results without the need to adjust for Federal, state
and local taxes, which vary considerably by jurisdiction. (See Note
Operating margins (excluding impairment) were 22.5
percent for the year, compared to 20.0 percent in the prior year.
Income from operations for same-location-same-period
nightclubs open more than a year increased by 18.3%.
Net cash provided by operating activities increased to
$18.9m from $17.3m in the prior year.
Interest expense declined to $3.9 million from $4.0 as
the company amortized loan balances. As of September 30, 2011, the balance
of long-term debt was $35.6 million compared to $42.7 million a year
Legal and professional fees declined to $2.3 million from
$3.0 million, reflecting a decrease in costs related to litigation for
claims under the Fair Labor Standards Act.
No continuing operations assets were impaired in 2011,
compared with $3.6 million in impairment charges in 2010.
Revenue improvements were noted in all three of the major
revenue categories tracked by the company: alcoholic beverage sales were
$32.6 million compared with $28.5 million last year; food and merchandise
was $7.4 million compared with $6.3 million; service revenues were $38.2
million compared with $34.2 million.
Note: Adjusted EBITDA is a financial statement measure
that was not derived in accordance with GAAP. We use Adjusted EBITDA (earnings
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.
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, New Orleans,
Charlotte, Dallas, Houston, Minneapolis and other cities operate 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 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
Forward-looking Statements: Certain statements
contained in this release regarding Rick's Cabaret future operating results or
performance or business plans or prospects and any other statements not
constituting historical fact are "forward-looking statements" subject to the
safe harbor created by the Private Securities Litigation Reform Act of 1995.
Where possible, the words "believe," "expect," "anticipate," "intent," "would,"
"will," "planned," "estimated," "potential," "goal," "outlook," and similar
expressions, as they relate to the company or its management have been used to
identify such forward-looking statements. All forward-looking statements reflect
only current beliefs and assumptions with respect to future business plans,
prospects, decisions and results, and are based on information currently
available to the company. Accordingly, the statements are subject to significant
risks, uncertainties and contingencies, which could cause the company‘s actual
operating results, performance or business plans or prospects to differ
materially from those expressed in, or implied by, these statements. Such risks,
uncertainties and contingencies include, but are not limited to, risks and
uncertainties associated with (i) operating and managing an adult business, (ii)
the business climates in cities where the company operates, (iii) the success or
lack thereof in launching and building the company’s businesses, (iv) the
operational and financial results of the company's adult nightclubs, (v)
conditions relevant to real estate transactions, (vi) the loss of key personnel,
and (vii) laws governing the operation of adult entertainment businesses.
Additional factors that could cause the company’s results to differ materially
from those described in the forward-looking statements are described in forms
filed with the SEC from time to time and available at
www.ricksinvestor.com or on the
SEC's internet website at www.sec.gov. Unless
required by law, Rick's Cabaret does not undertake any obligation to update
publicly any forward-looking statements, whether as a result of new information,
future events, or otherwise.
Contact: Allan Priaulx, 212-338-0050,
Consolidated Balance Sheets and Statement of Operations