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RCI Reports 3Q24 Results; X Spaces Call at 4:30 PM ET Today

Aug 08, 2024 4:05 PM

HOUSTON, Aug. 8, 2024 /PRNewswire/ -- RCI Hospitality Holdings, Inc. (Nasdaq: RICK) today reported results for the fiscal 2024 third quarter ended June 30, 2024. The company also filed its Form 10-Q today.

Summary Financials (in millions except EPS)

3Q24

3Q23

9M24

9M23

Total revenues

$76.2

$77.1

$222.4

$218.5

EPS

$(0.56)

$0.96

$0.30

$2.91

Non-GAAP EPS1

$1.35

$1.30

$3.11

$3.80

Other charges, net

$18.3

$2.6

$26.5

$5.7

Net cash provided by operating activities

$15.8

$15.3

$40.2

$47.0

Free cash flow1

$13.8

$14.3

$35.3

$42.1

Net income (loss) attributable to RCIHH common stockholders

$(5.2)

$9.1

$2.8

$27.1

Adjusted EBITDA1

$20.1

$22.7

$54.8

$64.8

Weighted average shares used in computing EPS – basic and diluted

9.28

9.43

9.33

9.31

1 See "Non-GAAP Financial Measures" below

Share Repurchases

In 3Q24, RCI repurchased 202,630 common shares for $9.2 million (average $45.27 per share). As of August 5, 2024, RCI repurchased an additional 133,244 common shares for $6.0 million (average $44.86 per share), resulting in 8,996,546 shares of common stock outstanding and $22.9 million in remaining purchase authorization.

Eric Langan, President and CEO, said:

"The third quarter reflected the first full quarter of our Back to Basics approach to business and our Capital Allocation Strategy. We are taking aggressive action to increase revenues, reduce costs, and expand margins, concentrating on our club business and buying back stock, all with the goal of increasing free cash flow per share.

"Nightclubs achieved record revenues, increasing year over year, on a same-store basis, and from last quarter. While operating margin was negatively impacted by non-cash impairments, it increased sequentially on a non-GAAP basis.

"Bombshells revenues are now up two quarters in a row. While operating margin was similarly affected by non-cash impairments, it expanded sequentially on a non-GAAP basis. These improvements reflected the new marketing and cost cutting moves implemented mid-February.

"Finally, I'm pleased to report that as of last week we have reached our short-term buyback objective of reducing shares outstanding to less than 9 million. As part of that effort, we bought back a total of 700,000 shares in the open market since February 2022, reducing our share count by the same number used in our big October 2021 and March 2023 acquisitions, and we did it at a 22% discount to the average share price used in those transactions.2

"Looking ahead, we are laser focused on opening our reformatted and new clubs and Bombshells currently under development; rebuilding Baby Dolls Fort Worth as quickly and efficiently as possible; reviewing all operating units to ensure they meet our financial objectives; selling non-income producing real estate to free up more cash and/or reduce debt; and using our cash flow to facilitate the buyback of more shares and acquisition of clubs."

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/RicksCEO/status/1821258346877612301 (X log in required)
Presentation link: https://www.rcihospitality.com/investor-relations/
To ask questions during Q&A: 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

3Q24 Results (Comparisons are to the year-ago period unless indicated otherwise)

Nightclubs segment: Revenues of $62.8 million increased by 0.6%, primarily reflecting 1.7% same-store sales growth and two new and reformatted clubs, partially offset by the temporary closing of clubs being reformatted to liquor from BYOB and severe weather in Texas and South Florida.3 By type of revenue, alcoholic beverages increased by 4.9%; food, merchandise and other increased by 5.1%; and service decreased by 5.3%. The differing growth rates primarily reflected a higher alcohol and lower service sales mix from clubs acquired over the past year and a half.

Non-cash impairment totaled $7.6 million compared to $2.6 million, resulting in operating income and margin of $13.6 million and 21.7% of revenues compared to $20.4 million and 32.7%, respectively. Non-GAAP operating income and margin was $21.9 million and 34.9% of revenues compared to $23.6 million and 37.7%, respectively.

Compared to last quarter, revenues increased by 5.8%, and operating margin was 21.7% compared to 18.6%. On a non-GAAP basis, operating margin was 34.9% compared to 33.4%. The non-GAAP margin increase reflected higher sales, including service, and reduced costs.

Bombshells segment: Revenues of $13.1 million declined 8.7%, primarily reflecting a 16.2% decline in SSS and temporary closings due to severe weather in Texas, partially offset by three locations not in SSS (Bombshells in San Antonio and Stafford in Texas and Cherry Creek Food Hall & Brewery in Greenwood Village, CO, with its Bombshells Kitchen).3

Non-cash impairment totaled $10.3 million, resulting in an operating loss and margin of $8.9 million and (67.8)% of revenues compared to income of $1.7 million and 11.8%, respectively. Non-GAAP operating income and margin was $1.4 million and 10.8% of revenues compared to $1.8 million and 12.8%, respectively. The decline in profitability primarily reflected lower SSS.

Compared to last quarter, revenues increased 2.9%, and operating margin was (67.8)% of revenues compared to 5.5%. On a non-GAAP basis, operating margin was 10.8% compared to 5.9%. The revenue and non-GAAP margin increases reflect the first full quarter of changes initiated mid-February 2024.

Corporate segment: Expenses totaled $7.2 million or 9.4% of total revenues compared to $6.3 million and 8.1%, respectively. Non-GAAP expenses totaled $6.4 million or 8.4% of total revenues compared to $5.8 million or 7.5%, respectively. The expense increase primarily reflected additional corporate level management, accounting and professional services due to recently acquired clubs, and new projects. Compared to 2Q24, expenses increased 5.4% and expense margin was flat at 9.4%, and on a non-GAAP basis, 8.4% compared to 8.8%.

Other charges included $7.6 million in goodwill, SOB and leasehold improvements impairment related to six clubs and $10.3 million in operating lease right-of-use asset and leasehold improvements impairment related to five Bombshells.

Income taxes were a benefit of $1.4 million compared to an expense of $2.3 million. The effective income tax rate was 21.5% compared to 20.1%.

Weighted average shares outstanding of 9.28 million decreased 1.6% due to share buybacks partially offset by shares issued in the 2Q23 Baby Dolls-Chicas Locas acquisition.

Debt was $245.4 million at June 30, 2024 compared to $231.9 million at March 31, 2024. The increase reflected a previously announced $20 million bank loan, partially offset by scheduled pay downs.

2 A total of 700,000 shares valued at $46.0 million were used in our big October 2021 (500,000 shares @ $60) and March 2023 acquisitions (200,000 shares @ $80). The first 700,000 shares bought back in the open market since February 2022 after the 2021 acquisition were acquired for $35.9 million (average $51.31 per share). This represents a discount of $10.1 million or 22% of the value of shares used in the two acquisitions.

3 See our July 11, 2024, news release on 3Q24 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, and (g) 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 11.7% and 21.6% effective tax rate of the pre-tax non-GAAP income before taxes for the nine months ended June 30, 2024 and 2023, 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 (benefit), (d) net interest expense, (e) settlement of lawsuits, (f) gains or losses on sale of businesses and assets, (g) gains or losses on insurance, and (h) 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 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, (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, 2023, 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 [email protected] and [email protected]

 

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 Nine Months Ended


June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023


Amount

% of
Revenue

Amount

% of
Revenue

Amount

% of
Revenue

Amount

% of
Revenue

Revenues









Sales of alcoholic beverages

$            34,442

45.2 %

$            34,151

44.3 %

$          100,665

45.3 %

$            93,937

43.0 %

Sales of food and merchandise

11,736

15.4 %

11,405

14.8 %

33,606

15.1 %

32,757

15.0 %

Service revenues

25,268

33.2 %

26,663

34.6 %

73,951

33.3 %

77,916

35.7 %

Other

4,734

6.2 %

4,836

6.3 %

14,148

6.4 %

13,930

6.4 %

Total revenues

76,180

100.0 %

77,055

100.0 %

222,370

100.0 %

218,540

100.0 %

Operating expenses









Cost of goods sold









Alcoholic beverages sold

6,273

18.2 %

6,397

18.7 %

18,445

18.3 %

17,136

18.2 %

Food and merchandise sold

4,197

35.8 %

4,106

36.0 %

12,228

36.4 %

11,429

34.9 %

Service and other

36

0.1 %

26

0.1 %

111

0.1 %

91

0.1 %

Total cost of goods sold (exclusive of items shown below)

10,506

13.8 %

10,529

13.7 %

30,784

13.8 %

28,656

13.1 %

Salaries and wages

20,992

27.6 %

20,578

26.7 %

63,299

28.5 %

58,682

26.9 %

Selling, general and administrative

25,057

32.9 %

23,803

30.9 %

74,911

33.7 %

68,561

31.4 %

Depreciation and amortization

3,901

5.1 %

4,041

5.2 %

11,638

5.2 %

11,108

5.1 %

Other charges, net

18,260

24.0 %

2,589

3.4 %

26,452

11.9 %

5,693

2.6 %

Total operating expenses

78,716

103.3 %

61,540

79.9 %

207,084

93.1 %

172,700

79.0 %

Income (loss) from operations

(2,536)

(3.3) %

15,515

20.1 %

15,286

6.9 %

45,840

21.0 %

Other income (expenses)









Interest expense

(4,240)

(5.6) %

(4,316)

(5.6) %

(12,455)

(5.6) %

(11,680)

(5.3) %

Interest income

130

0.2 %

87

0.1 %

320

0.1 %

268

0.1 %

Income (loss) before income taxes

(6,646)

(8.7) %

11,286

14.6 %

3,151

1.4 %

34,428

15.8 %

Income tax expense (benefit)

(1,426)

(1.9) %

2,269

2.9 %

378

0.2 %

7,447

3.4 %

Net income (loss)

(5,220)

(6.9) %

9,017

11.7 %

2,773

1.2 %

26,981

12.3 %

Net loss (income) attributable to noncontrolling interests

(13)

(0.0) %

68

0.1 %

(6)

(0.0) %

74

0.0 %

Net income (loss) attributable to RCIHH common shareholders

$             (5,233)

(6.9) %

$              9,085

11.8 %

$              2,767

1.2 %

$            27,055

12.4 %










Earnings (loss) per share









Basic and diluted










$               (0.56)


$                 0.96


$                 0.30


$                 2.91


Weighted average shares used in computing earnings (loss) per share









Basic and diluted

9,278,921


9,430,225


9,332,249


9,308,624


 

RCI HOSPITALITY HOLDINGS, INC.

SEGMENT INFORMATION

(in thousands)







For the Three Months Ended

For the Nine Months Ended


June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Revenues





Nightclubs

$            62,823

$            62,449

$          183,228

$          175,805

Bombshells

13,139

14,397

38,641

42,143

Other

218

209

501

592


$            76,180

$            77,055

$          222,370

$          218,540






Income (loss) from operations





Nightclubs

$            13,640

$            20,392

$            45,030

$            61,127

Bombshells

(8,914)

1,701

(8,129)

5,323

Other

(108)

(300)

(581)

(653)

Corporate

(7,154)

(6,278)

(21,034)

(19,957)


$             (2,536)

$            15,515

$            15,286

$            45,840

 

RCI HOSPITALITY HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)







For the Three Months Ended

For the Nine Months Ended


June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

CASH FLOWS FROM OPERATING ACTIVITIES





Net income (loss)

$              (5,220)

$                9,017

$                2,773

$              26,981

Adjustments to reconcile net income (loss) to net cash provided by operating activities:





Depreciation and amortization

3,901

4,041

11,638

11,108

Impairment of assets

17,931

2,631

25,964

3,293

Deferred income tax benefit

(4,508)

(790)

(6,419)

(790)

Loss (gain) on sale of businesses and assets

79

(183)

116

(872)

Amortization and writeoff of debt discount and issuance costs

150

162

462

453

Doubtful accounts expense on notes receivable

22

Gain on insurance

(91)

Noncash lease expense

783

763

2,318

2,226

Stock-based compensation

471

470

1,412

2,117

Changes in operating assets and liabilities, net of business acquisitions:





Accounts receivable

1,985

772

3,052

1,480

Inventories

(70)

(212)

79

Prepaid expenses, other current, and other assets

2,936

2,103

(3,484)

(3,602)

Accounts payable, accrued, and other liabilities

(2,674)

(3,666)

2,591

4,622

Net cash provided by operating activities

15,764

15,320

40,233

47,004

CASH FLOWS FROM INVESTING ACTIVITIES





Proceeds from sale of businesses and assets

1,950

1

1,950

2,811

Proceeds from insurance

91

Proceeds from notes receivable

63

57

179

170

Payments for property and equipment and intangible assets

(6,417)

(9,029)

(19,219)

(31,119)

Acquisition of businesses, net of cash acquired

(29,000)

Net cash used in investing activities

(4,404)

(8,971)

(17,090)

(57,047)

CASH FLOWS FROM FINANCING ACTIVITIES





Proceeds from debt obligations

20,000

22,657

11,595

Payments on debt obligations

(6,507)

(4,950)

(17,137)

(11,431)

Purchase of treasury stock

(9,173)

(12,775)

(98)

Payment of dividends

(552)

(565)

(1,674)

(1,580)

Payment of loan origination costs

(154)

(34)

(290)

(239)

Share in return of investment by noncontrolling partner

(600)

Net cash provided by (used in) financing activities

3,614

(5,549)

(9,219)

(2,353)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

14,974

800

13,924

(12,396)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

19,973

22,784

21,023

35,980

CASH AND CASH EQUIVALENTS AT END OF PERIOD

$              34,947

$              23,584

$              34,947

$              23,584

 

RCI HOSPITALITY HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands)






June 30, 2024

September 30, 2023

June 30, 2023

ASSETS




Current assets




Cash and cash equivalents

$              34,947

$              21,023

$              23,584

Accounts receivable, net

6,794

9,846

7,433

Current portion of notes receivable

263

249

244

Inventories

4,624

4,412

4,571

Prepaid expenses and other current assets

5,457

1,943

5,028

Total current assets

52,085

37,473

40,860

Property and equipment, net

283,834

282,705

277,530

Operating lease right-of-use assets, net

26,880

34,931

35,683

Notes receivable, net of current portion

4,228

4,443

4,507

Goodwill

61,911

70,772

78,684

Intangibles, net

170,709

179,145

181,262

Other assets

1,342

1,415

1,581

Total assets

$            600,989

$            610,884

$            620,107





LIABILITIES AND EQUITY




Current liabilities




Accounts payable

$                5,519

$                6,111

$                7,762

Accrued liabilities

20,155

16,051

17,732

Current portion of debt obligations, net

28,889

22,843

23,824

Current portion of operating lease liabilities

3,161

2,977

2,923

Total current liabilities

57,724

47,982

52,241

Deferred tax liability, net

22,724

29,143

30,146

Debt, net of current portion and debt discount and issuance costs

216,511

216,908

219,999

Operating lease liabilities, net of current portion

32,779

35,175

35,941

Other long-term liabilities

318

352

355

Total liabilities

330,056

329,560

338,682





Commitments and contingencies








Equity




Preferred stock

Common stock

91

94

94

Additional paid-in capital

68,950

80,437

82,091

Retained earnings

202,143

201,050

199,425

Total RCIHH stockholders' equity

271,184

281,581

281,610

Noncontrolling interests

(251)

(257)

(185)

Total equity

270,933

281,324

281,425

Total liabilities and equity

$            600,989

$            610,884

$            620,107

 

RCI HOSPITALITY HOLDINGS, INC.

NON-GAAP FINANCIAL MEASURES

(in thousands, except per share and percentage data)







For the Three Months Ended

For the Nine Months Ended


June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Reconciliation of GAAP net income (loss) to Adjusted EBITDA





Net income (loss) attributable to RCIHH common stockholders

$             (5,233)

$              9,085

$              2,767

$            27,055

Income tax expense (benefit)

(1,426)

2,269

378

7,447

Interest expense, net

4,110

4,229

12,135

11,412

Depreciation and amortization

3,901

4,041

11,638

11,108

Impairment of assets

17,931

2,631

25,964

3,293

Settlement of lawsuits

141

63

308

3,183

Loss (gain) on sale of businesses and assets

188

(105)

180

(692)

Gain on insurance

(91)

Stock-based compensation

471

470

1,412

2,117

Adjusted EBITDA

$            20,083

$            22,683

$            54,782

$            64,832






Reconciliation of GAAP net income (loss) to non-GAAP net income





Net income (loss) attributable to RCIHH common stockholders

$             (5,233)

$              9,085

$              2,767

$            27,055

Amortization of intangibles

598

918

1,897

2,722

Impairment of assets

17,931

2,631

25,964

3,293

Settlement of lawsuits

141

63

308

3,183

Stock-based compensation

471

470

1,412

2,117

Loss (gain) on sale of businesses and assets

188

(105)

180

(692)

Gain on insurance

(91)

Net income tax effect

(1,554)

(812)

(3,475)

(2,258)

Non-GAAP net income

$            12,542

$            12,250

$            29,053

$            35,329






Reconciliation of GAAP diluted earnings (loss) per share to non-GAAP diluted earnings per share





Diluted shares

9,278,921

9,430,225

9,332,249

9,308,624

GAAP diluted earnings (loss) per share

$               (0.56)

$                 0.96

$                 0.30

$                 2.91

Amortization of intangibles

0.06

0.10

0.20

0.29

Impairment of assets

1.93

0.28

2.78

0.35

Settlement of lawsuits

0.02

0.01

0.03

0.34

Stock-based compensation

0.05

0.05

0.15

0.23

Loss (gain) on sale of businesses and assets

0.02

(0.01)

0.02

(0.07)

Gain on insurance

0.00

0.00

0.00

(0.01)

Net income tax effect

(0.17)

(0.09)

(0.37)

(0.24)

Non-GAAP diluted earnings per share

$                 1.35

$                 1.30

$                 3.11

$                 3.80






Reconciliation of GAAP operating income (loss) to non-GAAP operating income





Income (loss) from operations

$             (2,536)

$            15,515

$            15,286

$            45,840

Amortization of intangibles

598

918

1,897

2,722

Impairment of assets

17,931

2,631

25,964

3,293

Settlement of lawsuits

141

63

308

3,183

Loss (gain) on sale of businesses and assets

188

(105)

180

(692)

Gain on insurance

(91)

Stock-based compensation

471

470

1,412

2,117

Non-GAAP operating income

$            16,793

$            19,492

$            45,047

$            56,372






Reconciliation of GAAP operating margin to non-GAAP operating margin





Income (loss) from operations

(3.3) %

20.1 %

6.9 %

21.0 %

Amortization of intangibles

0.8 %

1.2 %

0.9 %

1.2 %

Impairment of assets

23.5 %

3.4 %

11.7 %

1.5 %

Settlement of lawsuits

0.2 %

0.1 %

0.1 %

1.5 %

Loss (gain) on sale of businesses and assets

0.2 %

(0.1) %

0.1 %

(0.3) %

Gain on insurance

0.0 %

0.0 %

0.0 %

(0.0) %

Stock-based compensation

0.6 %

0.6 %

0.6 %

1.0 %

Non-GAAP operating margin

22.0 %

25.3 %

20.3 %

25.8 %






Reconciliation of net cash provided by operating activities to free cash flow





Net cash provided by operating activities

$            15,764

$            15,320

$            40,233

$            47,004

Less: Maintenance capital expenditures

1,986

1,064

4,980

4,949

Free cash flow

$            13,778

$            14,256

$            35,253

$            42,055

 

RCI HOSPITALITY HOLDINGS, INC.

NON-GAAP SEGMENT INFORMATION

($ in thousands)













For the Three Months Ended June 30, 2024

For the Three Months Ended June 30, 2023


Nightclubs

Bombshells

Other

Corporate

Total

Nightclubs

Bombshells

Other

Corporate

Total

Income (loss) from operations

$       13,640

$        (8,914)

$           (108)

$        (7,154)

$        (2,536)

$       20,392

$         1,701

$           (300)

$        (6,278)

$       15,515

Amortization of intangibles

578

16

4

598

624

81

208

5

918

Impairment of assets

7,619

10,312

17,931

2,631

2,631

Settlement of lawsuits

141

141

57

6

63

Stock-based compensation

471

471

470

470

Loss (gain) on sale of businesses and assets

(76)

6

258

188

(153)

50

(2)

(105)

Gain on insurance

Non-GAAP operating income (loss)

$       21,902

$         1,420

$           (108)

$        (6,421)

$       16,793

$       23,551

$         1,838

$             (92)

$        (5,805)

$       19,492












GAAP operating margin

21.7 %

(67.8) %

(49.5) %

(9.4) %

(3.3) %

32.7 %

11.8 %

(143.5) %

(8.1) %

20.1 %

Non-GAAP operating margin

34.9 %

10.8 %

(49.5) %

(8.4) %

22.0 %

37.7 %

12.8 %

(44.0) %

(7.5) %

25.3 %













For the Nine Months Ended June 30, 2024

For the Nine Months Ended June 30, 2023


Nightclubs

Bombshells

Other

Corporate

Total

Nightclubs

Bombshells

Other

Corporate

Total

Income (loss) from operations

$       45,030

$        (8,129)

$           (581)

$     (21,034)

$       15,286

$       61,127

$         5,323

$           (653)

$     (19,957)

$       45,840

Amortization of intangibles

1,758

126

13

1,897

1,880

500

329

13

2,722

Impairment of assets

15,652

10,312

25,964

3,293

3,293

Settlement of lawsuits

308

308

3,174

9

3,183

Stock-based compensation

1,412

1,412

2,117

2,117

Loss (gain) on sale of businesses and assets

(70)

10

240

180

(734)

66

(24)

(692)

Gain on insurance

(48)

(43)

(91)

Non-GAAP operating income (loss)

$       62,678

$         2,319

$           (581)

$     (19,369)

$       45,047

$       68,692

$         5,898

$           (324)

$     (17,894)

$       56,372












GAAP operating margin

24.6 %

(21.0) %

(116.0) %

(9.5) %

6.9 %

34.8 %

12.6 %

(110.3) %

(9.1) %

21.0 %

Non-GAAP operating margin

34.2 %

6.0 %

(116.0) %

(8.7) %

20.3 %

39.1 %

14.0 %

(54.7) %

(8.2) %

25.8 %

 

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SOURCE RCI Hospitality Holdings, Inc.