FALSE000093541900009354192025-02-102025-02-10

United States
Securities and Exchange Commission
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 10, 2025
RCI HOSPITALITY HOLDINGS, INC.
(Exact Name of Registrant as Specified in Its Charter)
Texas001-1399276-0458229
(State or Other Jurisdiction
of Incorporation)
(Commission
File Number)
(IRS Employer
Identification No.)
10737 Cutten Road
Houston, Texas 77066
(Address of Principal Executive Offices, Including Zip Code)
(281) 397-6730
(Issuer’s Telephone Number, Including Area Code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a -12)
oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d -2(b))
oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e -4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, $0.01 par valueRICKThe Nasdaq Global Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o


ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On February 10, 2025, we issued a press release announcing results for the fiscal quarter ended December 31, 2024, and the filing of our quarterly report on Form 10-Q for that quarter. Also on February 10, 2025, we will hold a conference call to discuss these results and related matters. A copy of the press release is furnished as Exhibit 99.1 to this current report on Form 8-K.
This information shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
 
(d) Exhibits
 
Exhibit Number Description
   
99.1 
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
RCI HOSPITALITY HOLDINGS, INC.
Date: February 10, 2025By:/s/ Eric Langan
Eric Langan
President and Chief Executive Officer
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RCI Reports 1Q25 Results, Hosts X Spaces Call at 4:30 PM ET Today
HOUSTON—February 10, 2025—RCI Hospitality Holdings, Inc. (Nasdaq: RICK) today reported results for the fiscal 2025 first quarter ended December 31, 2024. The Company also filed its Form 10-Q today.
Summary Financials (in millions, except EPS)
1Q251Q24
Total revenues$71.5$73.9
EPS$1.01$0.77
Non-GAAP EPS1
$0.80$0.87
Other gains, net$(2.2)$0.0
Net cash provided by operating activities$13.3$13.6
Free cash flow1
$12.1$12.7
Net income attributable to RCIHH common stockholders$9.0$7.2
Adjusted EBITDA1
$15.7$17.5
Weighted average shares used in computing EPS – basic and diluted8.92 9.37 
1 See “Non-GAAP Financial Measures” below.
1Q25 Summary (Comparisons are to the year-ago period unless indicated otherwise)
Eric Langan, President and CEO, said: "Nightclubs total and same-store sales increased, while GAAP and non-GAAP segment operating profit were approximately level with last year, despite the absence of a club due to fire in July. Bombshells total sales declined as expected with the sale/closure of underperforming locations, but GAAP and non-GAAP segment operating profit and margin improved. Consolidated net cash provided by operating activities and free cash flow nearly matched year-ago levels, and we continued to make progress with our Back to Basics 5-Year Capital Allocation Plan."
Back to Basics 5-Year Capital Allocation Plan (FY25-29)
•1Q25: Sale/closure of four underperforming Bombshells segment locations, for a total of five since September 2024.
•1Q25: Repurchased 66,000 common shares for $3.2 million ($48.76 average per share), with 8,889,000 shares outstanding at December 31, 2024.
•2Q25: Acquired Flight Club, the premier gentlemen's club in the Detroit market ($8.0 million for the club and $3.0 million for the real estate). The location is expected to generate an estimated $2.0 million in annualized EBITDA.
•2Q25: Opened an 8,500 square-foot Bombshells in downtown Denver.
X Spaces Conference Call at 4:30 PM ET Today
•Hosted by RCI President and CEO Eric Langan, CFO Bradley Chhay, and Mark Moran of Equity Animal.
•Call link: https://x.com/i/spaces/1zqKVjQVzjLKB (X log in required).
•Presentation link: https://www.rcihospitality.com/investor-relations/.
•To ask questions: 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.

1

1Q25 Results (Comparisons are to the year-ago period unless indicated otherwise)
Nightclubs segment: Revenues of $61.7 million increased by 1.1%. Sales primarily reflected a 3.7% increase in same-store sales, three new and reformatted clubs in Texas, and the absence of Baby Dolls Fort Worth due to fire in July.2 By type of revenue, food, merchandise and other increased by 8.6%; alcoholic beverages increased by 3.0%; and service declined by 3.7%.
The quarter included a gain of $1.0 million from additional cash insurance proceeds related to the July fire. Operating income was $20.9 million (33.8% of segment revenues) compared to $20.4 million (33.4%). Non-GAAP operating income, which does not include the gain, was $20.6 million (33.4% of segment revenues) compared to $21.0 million (34.3%).
Bombshells segment: Revenues of $9.6 million declined 24.7%. Sales primarily reflected the sale/closure of underperforming locations, a 7.5% decline in SSS, and a full quarter of the Stafford, TX location, which opened in mid-November 2023.2
The quarter included a gain of $1.3 million for a Bombshells that was sold. Operating income was $2.0 million (20.6% of segment revenues) compared to $86,000 (0.7%). Non-GAAP operating income, which does not include the gain, was $642,000 (6.7% of segment revenues) compared to $149,000 (1.2%).
Corporate segment: Expenses totaled $8.8 million (12.3% of total revenues) compared to $7.1 million (9.6%). Non-GAAP expenses totaled $8.4 million (11.7% of total revenues) compared to $6.6 million (9.0%). The increase reflected an expense of approximately $1.7 million to establish a self-insurance reserve.
Other gains, net of $2.2 million within consolidated operations included the fire insurance proceeds and the gain on sale as discussed in the Nightclubs and Bombshells paragraphs above, respectively.
Income tax expense was $1.85 million compared to $1.80 million. The effective tax rate was 16.9% compared to 19.9%.
Weighted average shares outstanding of 8.92 million decreased 4.8% due to share buybacks.
Debt was $235.5 million at December 31, 2024, compared to $238.2 million at September 30, 2024. The difference primarily reflected scheduled pay downs.
2 See our January 8, 2025, news release on 1Q25 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) settlement of lawsuits, (c) gains or losses on sale of businesses and assets, (d) gains or losses on insurance, and (e) 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) settlement of lawsuits, (c) gains or losses on sale of businesses and assets, (d) gains or losses on insurance, (e) stock-based compensation, (f) gains or losses on lease termination, and (g) the income tax effect of the above-described
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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 17.7% and 19.9% effective tax rate of the pre-tax non-GAAP income before taxes for the three months ended December 31, 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) income tax expense, (c) net interest expense, (d) settlement of lawsuits, (e) gains or losses on sale of businesses and assets, (f) gains or losses on insurance, (g) stock-based compensation, and (h) gains or losses on lease termination. 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, and (vi) 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, 2024, 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 gary.fishman@anreder.com and steven.anreder@anreder.com.
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RCI HOSPITALITY HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share, number of shares, and percentage data)
For the Three Months Ended
December 31, 2024December 31, 2023
Amount% of RevenueAmount% of Revenue
Revenues
Sales of alcoholic beverages$32,188 45.0 %$33,316 45.1 %
Sales of food and merchandise10,106 14.1 %10,802 14.6 %
Service revenues24,181 33.8 %25,119 34.0 %
Other5,008 7.0 %4,670 6.3 %
Total revenues71,483 100.0 %73,907 100.0 %
Operating expenses
Cost of goods sold
Alcoholic beverages sold5,846 18.2 %6,281 18.9 %
Food and merchandise sold3,563 35.3 %4,038 37.4 %
Service and other72 0.2 %40 0.1 %
Total cost of goods sold (exclusive of items shown below)9,481 13.3 %10,359 14.0 %
Salaries and wages20,564 28.8 %21,332 28.9 %
Selling, general and administrative26,207 36.7 %25,201 34.1 %
Depreciation and amortization3,569 5.0 %3,853 5.2 %
Other gains, net(2,244)(3.1)%(3)— %
Total operating expenses57,577 80.5 %60,742 82.2 %
Income from operations13,906 19.5 %13,165 17.8 %
Other income (expenses)
Interest expense(4,152)(5.8)%(4,216)(5.7)%
Interest income179 0.3 %94 0.1 %
Gain on lease termination979 1.4 %— — %
Income before income taxes10,912 15.3 %9,043 12.2 %
Income tax expense1,847 2.6 %1,799 2.4 %
Net income9,065 12.7 %7,244 9.8 %
Net income attributable to noncontrolling interests(41)(0.1)%(18)— %
Net income attributable to RCIHH common shareholders$9,024 12.6 %$7,226 9.8 %
Earnings per share
Basic and diluted$1.01 $0.77 
Weighted average shares used in computing earnings per share
Basic and diluted8,920,774 9,367,151 

4

RCI HOSPITALITY HOLDINGS, INC.
SEGMENT INFORMATION
(in thousands)
For the Three Months Ended
December 31, 2024December 31, 2023
Revenues
Nightclubs$61,724 $61,033 
Bombshells9,587 12,731 
Other172 143 
$71,483 $73,907 
Income (loss) from operations
Nightclubs$20,882 $20,369 
Bombshells1,971 86 
Other(171)(196)
Corporate(8,776)(7,094)
$13,906 $13,165 

5

RCI HOSPITALITY HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
For the Three Months Ended
December 31, 2024December 31, 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net income$9,065 $7,244 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization3,569 3,853 
Deferred income tax benefit(389)— 
Gain on sale of businesses and assets(1,463)(3)
Amortization and writeoff of debt discount and issuance costs63 163 
Doubtful accounts expense on notes receivable— 22 
Gain on insurance(1,150)— 
Noncash lease expense658 762 
Stock-based compensation470 470 
Changes in operating assets and liabilities, net of business acquisitions:
Receivables2,373 1,229 
Inventories(4)(218)
Prepaid expenses, other current, and other assets(598)(9,029)
Accounts payable, accrued, and other liabilities750 9,140 
Net cash provided by operating activities13,344 13,633 
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of businesses and assets129 — 
Proceeds from insurance1,150 — 
Proceeds from notes receivable71 55 
Payments for property and equipment and intangible assets(5,754)(5,135)
Net cash used in investing activities(4,404)(5,080)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from debt obligations2,963 701 
Payments on debt obligations(5,694)(6,352)
Purchase of treasury stock(3,218)(2,072)
Payment of dividends(623)(562)
Payment of loan origination costs— (136)
Net cash used in financing activities(6,572)(8,421)
NET INCREASE IN CASH AND CASH EQUIVALENTS2,368 132 
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD32,350 21,023 
CASH AND CASH EQUIVALENTS AT END OF PERIOD$34,718 $21,155 
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RCI HOSPITALITY HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
December 31, 2024September 30, 2024
ASSETS
Current assets
Cash and cash equivalents$34,718 $32,350 
Receivables, net3,519 5,832 
Inventories4,640 4,676 
Prepaid expenses and other current assets4,226 4,427 
Total current assets47,103 47,285 
Property and equipment, net282,621 280,075 
Operating lease right-of-use assets, net25,573 26,231 
Notes receivable, net of current portion4,103 4,174 
Goodwill61,911 61,911 
Intangibles, net162,881 163,461 
Other assets2,026 1,227 
Total assets$586,218 $584,364 
LIABILITIES AND EQUITY
Current liabilities
Accounts payable$5,010 $5,637 
Accrued liabilities20,514 20,280 
Current portion of debt obligations, net17,788 18,871 
Current portion of operating lease liabilities3,008 3,290 
Total current liabilities46,320 48,078 
Deferred tax liability, net22,304 22,693 
Debt, net of current portion and debt discount and issuance costs217,741 219,326 
Operating lease liabilities, net of current portion27,471 30,759 
Other long-term liabilities3,611 398 
Total liabilities317,447 321,254 
Commitments and contingencies
Equity
Preferred stock— — 
Common stock89 90 
Additional paid-in capital58,731 61,511 
Retained earnings210,160 201,759 
Total RCIHH stockholders' equity268,980 263,360 
Noncontrolling interests(209)(250)
Total equity268,771 263,110 
Total liabilities and equity$586,218 $584,364 


7

RCI HOSPITALITY HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES
(in thousands, except per share and percentage data)
For the Three Months Ended
December 31, 2024December 31, 2023
Reconciliation of GAAP net income to Adjusted EBITDA
Net income attributable to RCIHH common stockholders$9,024 $7,226 
Income tax expense (benefit)1,847 1,799 
Interest expense, net3,973 4,122 
Depreciation and amortization3,569 3,853 
Settlement of lawsuits179 — 
Gain on sale of businesses and assets(1,406)(3)
Gain on insurance(1,017)— 
Stock-based compensation470 470 
Gain on lease termination(979)— 
Adjusted EBITDA$15,660 $17,467 
Reconciliation of GAAP net income to non-GAAP net income
Net income attributable to RCIHH common stockholders$9,024 $7,226 
Amortization of intangibles580 659 
Settlement of lawsuits179 — 
Stock-based compensation470 470 
Gain on sale of businesses and assets(1,406)(3)
Gain on insurance(1,017)— 
Gain on lease termination(979)— 
Net income tax effect310 (220)
Non-GAAP net income$7,161 $8,132 
Reconciliation of GAAP diluted earnings per share to non-GAAP diluted earnings per share
Diluted shares8,920,774 9,367,151 
GAAP diluted earnings per share$1.01 $0.77 
Amortization of intangibles0.07 0.07 
Settlement of lawsuits0.02 0.00 
Stock-based compensation0.05 0.05 
Gain on sale of businesses and assets(0.16)0.00 
Gain on insurance(0.11)0.00 
Gain on lease termination(0.11)0.00 
Net income tax effect0.03 (0.02)
Non-GAAP diluted earnings per share$0.80 $0.87 
8

For the Three Months Ended
December 31, 2024December 31, 2023
Reconciliation of GAAP operating income to non-GAAP operating income
Income from operations$13,906 $13,165 
Amortization of intangibles580 659 
Settlement of lawsuits179 — 
Stock-based compensation470 470 
Gain on sale of businesses and assets(1,406)(3)
Gain on insurance(1,017)— 
Non-GAAP operating income$12,712 $14,291 
Reconciliation of GAAP operating margin to non-GAAP operating margin
GAAP operating margin19.5 %17.8 %
Amortization of intangibles0.8 %0.9 %
Settlement of lawsuits0.3 %0.0 %
Stock-based compensation0.7 %0.6 %
Gain on sale of businesses and assets(2.0)%0.0 %
Gain on insurance(1.4)%0.0 %
Non-GAAP operating margin17.8 %19.3 %
Reconciliation of net cash provided by operating activities to free cash flow
Net cash provided by operating activities$13,344 $13,633 
Less: Maintenance capital expenditures1,276 983 
Free cash flow$12,068 $12,650 
9

RCI HOSPITALITY HOLDINGS, INC.
NON-GAAP SEGMENT INFORMATION
($ in thousands)
For the Three Months Ended December 31, 2024
NightclubsBombshellsOtherCorporateTotal
Income (loss) from operations$20,882 $1,971 $(171)$(8,776)$13,906 
Amortization of intangibles574 1 — 5 580 
Settlement of lawsuits179 — — — 179 
Stock-based compensation— — — 470 470 
Loss (gain) on sale of businesses and assets16 (1,330)— (92)(1,406)
Gain on insurance(1,017)— — — (1,017)
Non-GAAP operating income (loss)$20,634 $642 $(171)$(8,393)$12,712 
GAAP operating margin33.8 %20.6 %(99.4)%(12.3)%19.5 %
Non-GAAP operating margin33.4 %6.7 %(99.4)%(11.7)%17.8 %
For the Three Months Ended December 31, 2023
NightclubsBombshellsOtherCorporateTotal
Income (loss) from operations$20,369 $86 $(196)$(7,094)$13,165 
Amortization of intangibles591 63 — 5 659 
Stock-based compensation— — — 470 470 
Gain on sale of businesses and assets(1)— — (2)(3)
Non-GAAP operating income (loss)$20,959 $149 $(196)$(6,621)$14,291 
GAAP operating margin33.4 %0.7 %(137.1)%(9.6)%17.8 %
Non-GAAP operating margin34.3 %1.2 %(137.1)%(9.0)%19.3 %
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v3.25.0.1
Cover
Feb. 10, 2025
Cover [Abstract]  
Document Type 8-K
Document Period End Date Feb. 10, 2025
Entity Registrant Name RCI HOSPITALITY HOLDINGS, INC.
Entity Incorporation, State or Country Code TX
Entity File Number 001-13992
Entity Tax Identification Number 76-0458229
Entity Address, Address Line One 10737 Cutten Road
Entity Address, City or Town Houston
Entity Address, State or Province TX
Entity Address, Postal Zip Code 77066
City Area Code 281
Local Phone Number 397-6730
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common stock, $0.01 par value
Trading Symbol RICK
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0000935419
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