RCI Hospitality Holdings Inc
NASDAQ:RICK
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RCI Hospitality Holdings Inc
RCI Hospitality Holdings, Inc. operates as a holding company, which engages in hospitality activities and related businesses. The company is headquartered in Houston, Texas and currently employs 2,529 full-time employees. The Company, through its subsidiaries, is engaged in various activities in the hospitality and other businesses. The firm's segments include Nightclubs, Bombshells and Other. The Nightclubs segment operates adult entertainment nightclubs through several brands, such as Rick's Cabaret, Jaguars Club, Tootsie's Cabaret, XTC Cabaret, Club Onyx, Hoops Cabaret and Sports Bar, Scarlett's Cabaret, Temptations Adult Cabaret, Foxy's Cabaret, Vivid Cabaret, Downtown Cabaret, Cabaret East and Silver City Cabaret, among others. This segment also operates one dance club under the brand name Studio 80. The Bombshells segment owns and operates restaurants and sports bars in Houston, Dallas, Austin, Spring, Pearland, Tomball and Katy, Texas under the brand name Bombshells Restaurant & Bar. Other segment owns a media division (Media Group), including the trade magazine serving the adult nightclubs industry and the adult retail products industry.
RCI Hospitality Holdings, Inc. operates as a holding company, which engages in hospitality activities and related businesses. The company is headquartered in Houston, Texas and currently employs 2,529 full-time employees. The Company, through its subsidiaries, is engaged in various activities in the hospitality and other businesses. The firm's segments include Nightclubs, Bombshells and Other. The Nightclubs segment operates adult entertainment nightclubs through several brands, such as Rick's Cabaret, Jaguars Club, Tootsie's Cabaret, XTC Cabaret, Club Onyx, Hoops Cabaret and Sports Bar, Scarlett's Cabaret, Temptations Adult Cabaret, Foxy's Cabaret, Vivid Cabaret, Downtown Cabaret, Cabaret East and Silver City Cabaret, among others. This segment also operates one dance club under the brand name Studio 80. The Bombshells segment owns and operates restaurants and sports bars in Houston, Dallas, Austin, Spring, Pearland, Tomball and Katy, Texas under the brand name Bombshells Restaurant & Bar. Other segment owns a media division (Media Group), including the trade magazine serving the adult nightclubs industry and the adult retail products industry.
Revenue: Total revenue for the quarter was $71.1 million, down from $76.2 million year-over-year, mainly due to the sale and divestiture of underperforming Bombshells locations.
Profitability Turnaround: Net income swung to $4.1 million from a loss of $5.2 million last year, helped by the absence of large impairment charges.
Segment Performance: Nightclub revenues were nearly flat year-over-year; Bombshells revenue fell due to divestitures and lower same-store sales, but both saw sequential improvement from Q2.
Share Buybacks: More than 75,000 shares were repurchased for $3 million, reducing the share count to about 8.76 million.
Capital Allocation: Management reaffirmed its strategy, targeting 40% of free cash for acquisitions and 60% for buybacks, debt reduction, and dividends.
Insurance Costs: High self-insurance reserve charges continued to weigh on reported EBITDA, but management plans to transition to a captive insurance program that should lower these charges.
Outlook: Management is open to selling Bombshells real estate and businesses for the right price, aiming to redeploy capital into higher-return nightclub assets and buybacks.
