Rci Hospitality Holdings, Inc. · NASDAQ:RICK
Rci Hospitality — Granite Conference Series 2023
15 slides from Rci Hospitality's conference presentation, Jan 11, 2023
Slide 1: Granite Conference Series
NASDAQ: RICK | Granite Conference Series | January 11-12, 2023 | www.rcihospitality.com | @RCIHHinc Building a portfolio of well-managed, high cash-flowing nightclubs and restaurants
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, among other things, statements regarding plans, objectives, goals, strategies, future events or performance and under
Slide 3: Non-GAAP Financial Measures
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
Slide 4: Executive Summary
Executive Summary What We Do What We Really Do Key to Our Success Moat Change Growth Opportunity Management Expertise Leader in the nightclub-bar- restaurant business Free cash flow per share compounder Disciplined capital allocation strategy Adult nightclub license creates barrier to entry Transfor
Slide 5: Strong Portfolio of Hospitality Venues
Strong Portfolio of Hospitality Venues Nightclubs • 54 clubs in 13 states (12/31/22) • Well-known brands, many with restaurants • 77% of revenues (TTM ended 9/30/22) Overview • Own and franchise 67 nightclubs and restaurants (12/31/22) • Founded in 1983 • Nasdaq IPO in 1995 Growth Drivers • Consumer
Slide 6: Impressive Track Record Since Launching Capital Allocation Strategy
10.41 10.23 9.74 9.72 9.66 9.20 9.01 9.38 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 $14.9 $18.5 $19.3 $23.2 $33.3 $13.5 $36.1 $58.9 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Free Cash Flow ($M)1 11.0% 13.7% 13.3% 14.0% 18.4% 10.2% 18.5% 22.0% FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FCF as % of Revenues1
Slide 7: Solid Recent Performance
12% 15% 20% 22% 15% 25% 17% 25% 20% 15% 23% 31% 35% 32% 29% 31% 35% 34% 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 FCF Adj. EBITDA $4.4 $8.7 $13.6 $20.4 $17.6 $18.0 $19.9 $24.6 $24.2 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 $15.6 $17.0 $20.2 $29.1 $35.7 $18.0 $38.1 $37.5 $36.0 9/30/20 12/31/20
Slide 8: Capital Allocation Strategy
Capital Allocation Strategy1 1) We may deviate from this strategy if other strategic rationale warrants • Repurchase shares when FCF yield is more than 10% • Develop critical mass, market awareness, and sell franchises • Structure investments in new units to generate annual cash on cash return of at
Slide 9: Great Business Model
Great Business Model (TTM ended 9/30/22) Strong Cash Generation • High gross profit margin (86.5%) • Fast cash conversion cycle • Low maintenance capex ($5.6M) Nightclubs • High barriers to entry • Few municipalities issue new licenses Bombshells • Ultimate experience for casual dining, sports viewi
Slide 10: Nightclubs: Significant Acquisition Opportunities
Nightclubs: Significant Acquisition Opportunities Market • 2,200 clubs / ~500 meet our acquisition criteria • We are one of the largest, but our market share is minimal • Long-term owners interested in selling, we are the acquirer of choice Financial Dynamics • Buy earnings accretive clubs at 3-5x a
Slide 11: Rick's Cabaret Steakhouse & Casino
Rick’s Cabaret Steakhouse & Casino The Acquisition • 4-story, 30,000 sq-ft building in historic Central City, CO • Paid $2.4M cash for property The Central City Market1 • 1 of 3 Colorado cities with legalized gambling • $1B wagered on slots • Generated +$80M in adjusted gross proceeds The Plan • Clu
Slide 12: Bombshells: Next Generation Sports Bar Concept
Bombshells: Next Generation Sports Bar Concept More Upscale • Better quality food, service and experience • Big HDTVs, scratch kitchen, free Wi-Fi, USB charging stations, DJs • 4 Dayparts: Lunch, happy hour, dinner, late night • Late night drives high AUVs and industry-leading margins 12 High Impact
Slide 13: 1Q23 Nightclub & Bombshells Sales
1Q23 Nightclub & Bombshells Sales 13 ($ in Millions) 1Q23 Total Sales Total Sales vs. 1Q22 SSS vs. 1Q22 SSS vs. 1Q20 Combined $69.2 +13.3% -2.7% +8.6% Nightclubs $55.9 +20.7% +1.2% +10.0% Bombshells $13.3 -9.7% -13.9% +3.6%
Slide 14: Highly Experienced Management
Highly Experienced Management 14 Eric Langan President & CEO Travis Reese Executive Vice President Bradley Chhay Chief Financial Officer Director since 1998, President & CEO since 1999, in the adult nightclub business since 1989 EVP and Director since 1999, also served as Director of Technology, cre
Slide 15: Contact Information
Corporate Office 10737 Cutten Road Houston, TX 77066 Phone: (281) 397-6730 Investor Relations Gary Fishman Steven Anreder Phone: (212) 532-3232 IR Website www.rcihospitality.com Nasdaq: RICK Contact Information 15
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