RCI Hospitality Holdings, Inc. (NASDAQ: RICK) has reported its nightclubs and Bombshells restaurants' sales for the fiscal first quarter ended December 31, 2023. The company announced that sales for this period amounted to $73.3 million, reflecting a 5.9% increase compared to the same period last year.
Eric Langan, President and CEO of RCI, commented on the results, stating, "First quarter sales benefited from acquisitions and new locations. While same-store sales declined year-over-year, the trend improved over the course of the quarter, as we had hoped, due to the strength of nightclubs, which is a good sign."
He further added, "During December, I spent more than two weeks visiting our clubs in Houston, Colorado, Miami, and New York, talking to guests, entertainers, and our teams. The consensus was that we have hopefully seen the worst of the same-store sales decline from uncertain macroeconomic conditions and tough year-over-year comparisons. Everybody seemed more optimistic compared to what they were seeing late summer. That's promising."
Breaking down the sales performance, nightclubs recorded sales totaling $60.6 million, reflecting an increase of 8.4% year-over-year, driven by acquisitions and new locations. However, the same-store sales declined by 7.2% year-over-year. On the other hand, Bombshells sales totaled $12.7 million, representing a decline of 4.6% year-over-year.
Langan highlighted that the company is exploring strategic opportunities to maximize the value of the Bombshells assets and accelerate growth, as previously announced on its December 14 conference call.
When comparing the sales to the same period last year, combined club and restaurant sales saw a 5.9% increase, while same-store sales declined by 9.8%.
The full financial results for the first quarter of 2024 are anticipated to be disclosed before February 9, 2024.
The company's stock has moved -2.6% following the release of this information, and is currently trading at a price of $62.4 per share.
The company's full 8-K submission is available here.
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (k) | $165,748 | $181,059 | $132,327 | $195,258 | $267,620 | $289,918 |
| Revenue Growth | n/a | 9.24% | -26.91% | 47.56% | 37.06% | 8.33% |
| Operating Margins | 17% | 19% | 2% | 20% | 27% | 22% |
| Net Margins | 13% | 11% | -5% | 16% | 17% | 13% |
| Net Income (k) | $20,879 | $20,294 | -$6,085 | $30,336 | $46,041 | $37,667 |
| Net Interest Expense (k) | $319 | $10,209 | $9,811 | $9,992 | $11,950 | $14,051 |
| Depreciation & Amort. (k) | $7,722 | $9,072 | $8,836 | $8,238 | $12,391 | $14,750 |
| Diluted Shares (k) | 9,713 | 9,322 | 9,019 | 9,408 | 9,230 | 9,430 |
| Free Cash Flow (k) | $506 | $16,466 | $9,896 | $28,480 | $40,506 | $28,010 |
| Capital Expenditures | $25,263 | $20,708 | $5,736 | $13,511 | $24,003 | $36,749 |
| Current Ratio | 0.9 | 0.96 | 0.89 | 1.1 | 1.32 | 0.78 |
| Total Debt (k) | $142,415 | $145,003 | $267,805 | $135,799 | $219,131 | $240,732 |
| Net Debt / EBITDA | 3.77 | 3.01 | 21.66 | 2.52 | 2.21 | 2.76 |
RCI Hospitality has growing revenues and increasing reinvestment in the business, a strong EPS growth trend, and irregular cash flows. However, the firm has a highly leveraged balance sheet. Finally, we note that RCI Hospitality has average net margins with a stable trend.
