Rick's Cabaret International, Inc. Agrees To Buy Adult Nightclub In The Southeastern United States
HOUSTON-(October 18, 2007)-Rick's Cabaret International,
operator of upscale gentlemen's clubs, entered into a Letter of
Intent to buy an existing adult nightclub in the Southeastern United
States that it believes will add about $18 million in annual revenue
and about $8 million in EBITDA (earnings before income taxes, depreciation
and amortization). For the twelve months ended June 30, 2007, Rick's
had revenues of approximately $29 million and EBITDA of approximately
Under terms of the Letter of Intent, the club will be acquired for
$25 million. The acquisition is subject to completion of due diligence,
obtaining appropriate financing, the transfer of all necessary permits
and other authorizations, and execution of definitive documents.
The name of the fully licensed club and its location are being kept
confidential until the execution of definitive documents. The company
presently plans to finance this acquisition primarily through debt.
"This is an important acquisition for our company. It should
add significantly to our earnings, it falls within our target price
range of three to five times EBITDA and is consistent with our strategy
of acquiring venues that will be immediately accretive," according
to Eric Langan
, President and CEO of 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 and operates or licenses adult nightclubs in New
York City, New Orleans, Charlotte, Houston, Minneapolis and other
cities under the names "Rick's Cabaret," "XTC"
and "Club Onyx." No sexual contact is permitted at any
of these locations. Rick's Cabaret also owns the adult Internet
membership Web site, couplestouch.com,
and a network of online adult auction sites under the flagship URL
Cabaret common stock is traded on NASDAQ under the symbol RICK.
For further information contact [email protected].
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 New York City and elsewhere; the success or lack thereof
in launching and building the company's businesses in New York City
and elsewhere; the Company's ability to identify and secure suitable
locations for new nightclubs on acceptable terms, open the anticipated
number of new nightclubs on time and within budget; achieve anticipated
rates of same-store sales; hire and train additional nightclub personnel
and integrate new nightclubs into its operations; unexpected increases
in costs of sales or employee, pre-opening or other expenses; the
economic conditions in the new markets into which the Company expands
and possible uncertainties in the customer base in these areas;
fluctuations in quarterly operating results; the impact of any negative
publicity or public attitudes; competitive pressure from other national
and regional nightclub chains; 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
go to www.ricks.com.