RCI Hospitality (RICK) investor relations material

Executive summary

• Third quarter revenue was $71.1M, down 6.6% year-over-year, mainly due to Bombshells divestitures and economic uncertainty; net income was $4.1M, reversing a $5.2M loss in the prior year.

• EPS improved to $0.46 from $(0.56); non-GAAP EPS was $0.77 versus $1.35 in the prior year.

• Nightclubs revenue remained nearly flat, while Bombshells saw a significant revenue drop and margin recovery after divestitures.

• Strategic acquisitions and new club openings continued, with share repurchases reducing shares outstanding by 5.2% year-over-year.

• Profitability benefited from the absence of impairment charges and improved operating margins.

Financial highlights

• Total revenues: $71.1M vs. $76.2M year-over-year; year-to-date $208.5M, down 6.2%.

• Net income: $4.1M vs. $-5.2M year-over-year; GAAP EPS $0.46 vs. $-0.56; non-GAAP EPS $0.77 vs. $1.35.

• Adjusted EBITDA: $15.3M vs. $20.1M; year-to-date $45.2M, down 17.4%.

• Free cash flow: $13.3M in Q3, nearly flat year-over-year; year-to-date $32.3M, down 8.3%.

• Debt at quarter end: $241.3M, nearly flat sequentially.

Outlook and guidance

• Five-year plan targets $400M revenue, $75M free cash flow, 7.5M shares outstanding, and doubled free cash flow per share by FY29.

• 40% of free cash flow to acquisitions, 60% to buybacks, debt reduction, and dividends.

• Growth strategy focuses on acquiring new nightclubs, expanding Bombshells, and maintaining minimum cash-on-cash returns of 25–33%.

• Management expects adequate cash flows from operations for the next 12 months.

• Economic uncertainty from tariffs and tax policy changes continues to impact the business environment.