Rick's Cabaret International, Inc. Reports Third Quarter Revenue Increase to $20

HOUSTON, Aug. 9, 2011 /PRNewswire/ -- Rick's Cabaret International, Inc. (NASDAQ: RICK), the leading group of upscale gentlemen's clubs, had revenues of $20.8 million in its third quarter ended June 30, a 15.4 percent increase over the $18.0 million in the same period last year. The company reported adjusted EBITDA* of $6.0 million a 52.7 percent increase over $3.9 million in the same period last year.
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The company reported net income from continuing operations for the quarter of $2.5 million, compared with $1.1 million in 2010, with earnings per diluted share from continuing operations of 25 cents versus 11 cents last year. After accounting for a loss from discontinued operations including the now closed club in Las Vegas, net income was $888,000 versus $857,000. Net income per diluted share for both periods was nine cents.
"With this quarter we have now put the pain of the Las Vegas situation behind us and we are well positioned to move forward on an apples-to-apples basis," said Eric Langan, President and CEO of Rick's Cabaret. "Apart from the Las Vegas loss, we had a strong third quarter, with increases in cash flows, EBITDA and income from continuing operations. Our larger clubs across the country are doing well and we will have a positive outlook on the remainder of the year as long as the general economy maintains its present levels."
Mr. Langan will discuss the third quarter results in detail at a conference call and webcast today at 4:30 pm EDT that can be accessed at http://www.investorcalendar.com/IC/CEPag… or though the Rick's Cabaret investor website, www.ricksinvestor.com. The toll free participant dial-in number is 877-407-8033 (International 201-689-8033). The toll free replay number is 877-660-6853 (international 201-612-7415). Replay pass codes required for playback are: Account number 286 and Conference ID 376967.
The increase in total revenues was primarily attributable to clubs acquired during the past year, additional traffic generated during the NBA Championship series in Dallas and Miami, and gains at the Rick's locations in San Antonio, North Austin and Minneapolis.
Total revenues for same-location-same-period of club operations open more than one year increased by 9.0 percent to $19.2 million in the quarter from $17.6 million for the same period last year. Comparable club operating income was $5.7 million compared with $4.7 million last year.
Net cash generated from continuing operations was $13.7 million, compared with $12.0 million last year. Interest expense dropped to $1.0 million from $1.2 million.
*Adjusted EBITDA is a financial statement measure that was not derived in accordance with GAAP. We use adjusted EBITDA (earnings from continuing operations 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.
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