Rci Hospitality Holdings, Inc. · NASDAQ:RICK
Rci Hospitality — Q3 2021 Earnings Presentation
18 slides from Rci Hospitality's earnings presentation, Aug 5, 2021
Slide 1: Building a portfolio of well-managed, high cash-flowing nightclubs and restaurants
Building a portfolio of well-managed, high cash-flowing nightclubs and restaurants NASDAQ: RICK 3Q21 Conference Call August 5, 2021 www.rcihospitality.com
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: Today’s News
Today’s News • Outstanding performance • Record revenues of $57.9M • Record net cash from operating activities of $15.0M, Record free cash flow of $13.0M 3Q21 • Consolidated operating margin of 32.0% Highlights • Net income of $12.3M, Adjusted EBITDA of $20.4M • EPS of $1.37 vs. ($0.60) in 3Q20, Rec
Slide 5: Nightclubs Segment
Nightclubs Segment Revenues ($M) Operating Margin As % of Segment Revenues $41.0 $37.9 $37.9 60% GAAP Non-GAAP $35.9 $31.4 $30.8 40% $25.2 20% 0% $13.1 -20% $6.0 -40% -60% 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 • 3Q21: Revenues of $41.0M, operating
Slide 6: Bombshells Segment
Bombshells Segment Revenues ($M) $16.1 Operating Margin As % of Segment Revenues $15.5 36% GAAP Non-GAAP $13.0 $13.1 30% $10.4 $8.8 $8.5 $8.8 $8.5 24% 18% 12% 6% 0% 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 • 3Q21: Revenues of $16.1M, operating margin
Slide 7: Analysis of Consolidated Statement of Operations
Analysis of Consolidated Statement of Operations Sales Mix by Segment 3Q21 vs. 3Q19 (% of sales) Analysis Primarily reflects change in sales mix of service (29% vs. 37% of total sales) Cost of Goods 15.3% vs. 14.2% and of Bombshells (28% vs. 18% of total sales) Salaries & Wages 24.0% vs. 28.0% SG&A
Slide 8: Record Setting Performance
Record Setting Performance In 3Q21 Achieved Record Total Record All-Time High ($ in millions, except EPS) Levels in 8 of 13 Key 3Q21 Period Amount Indicators Revenue Consolidated $57.9 3Q21 $57.9 Nightclubs $41.0 3Q21 $41.0 Bombshells $16.1 3Q21 $16.1 Income (loss) from Operations Consolidated $18.5
Slide 9: Cash, FCF & Balance Sheet Trends ($M)
Cash, FCF & Balance Sheet Trends ($M) $29.1 Cash Debt $146.6 $143.5 $141.8 $140.4 $142.7 $141.4 $20.2 $17.0 $134.8 $15.6 $132.4 $14.1 $14.8 $13.2 $127.6 $11.0 $9.8 6/30/19 9/30/19 12/31/19 3/31/20 6/30/20 9/30/20 12/31/20 3/31/21 6/30/21 6/30/19 9/30/19 12/31/19 3/31/20 6/30/20 9/30/20 12/31/20 3/31
Slide 10: Debt (as of 6/30/21, $ in millions)
Debt (as of 6/30/21, $ in millions) Total of $128.7* Weighted Average Interest Rate (WAIR): 6.68% $83.7 Secured by Real Estate (65.1%) $22.1 Seller Financing (17.2% of total) • 5.73% WAIR • Secured by the respective clubs • Scarlett’s: $14.8 @ 7.39% WAIR • VIP’s & Blush: $7.3 @ 7.62% WAIR $13.4 Unse
Slide 11: Debt Manageability
Debt Manageability Total Occupancy Costs As % of Total Revenues Weighted Average Interest Rate on Debt 7.53% 23.6% 7.37% 11.8% 6.79% 8.6% 8.9% 6.71% 6.68% 7.5% 7.6% 7.3% 7.6% 5.7% 6.55% 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 3Q16 3Q17 3Q18 3Q19 3Q20 3Q21 Debt Maturities as of 6/30/21 ($M) Comm
Slide 12: Capital Allocation Strategy
Capital Allocation Strategy* • Repurchase shares when FCF yield is more than 10% Buy Back Shares M&A Organic Buy More Judiciously of the Right Expand Nightclubs Bombshells • Buy good, solid, cash Drive Value • Develop critical mass, flowing clubs at 3-5x market awareness, adjusted EBITDA with 10-15%
Slide 13: Acquisition of 11 Clubs in 6 States
Acquisition of 11 Clubs in 6 States The Clubs Consideration • Well-established, proven cash generators • $57M for the clubs • All fully open • $13M for their intellectual property • Total $40M* in revenue and $14M* in adjusted • $18M for 6 real estate properties EBITDA (2019) Great Locations Payment
Slide 14: Other Developments
Other Developments • AdmireMe – Social media platform – Enables “creators” to post content and receive payment from their "admirers" – Comparable to OnlyFans – Looking at FY 2022 launch • Properties for Sale/Future Development Stock photo posed by model – Three properties under contract for sale www
Slide 15: Growth Initiatives
Growth Initiatives • Refinancing Real Estate Debt – Goal is to pay off high interest debt and increase length of amortization • Bombshells – “The Next 10” – Arlington, TX under construction – Due diligence on other locations • Bombshells – Franchising – San Antonio, TX under construction – Due dilig
Slide 16: Appendix
Appendix NASDAQ: RICK 3Q21 Conference Call August 5, 2021 www.rcihospitality.com
Slide 17: Record Setting Performance
Record Setting Performance In 3Q21 Achieved Record Levels in 8 of 13 Key Indicators Total 3Q21 vs. 3Q19 Change Total 3Q21 vs. 3Q20 Change Record All-Time High ($ in millions, except EPS) 3Q21 3Q19 $ % 3Q20 $ % Period Amount Revenue Consolidated $57.9 $47.0 $10.8 23.0% $14.7 $43.1 293.0% 3Q21 $57.9 N
Slide 18: Contact Information
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 18
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