Rick's Cabaret International, Inc. Updates 2007 Guidance and Projects 2008 Outlook With Future Expansion Plans
HOUSTON, TX -- (MARKET WIRE) -- February 13, 2007 -- Rick's Cabaret International, Inc. (NASDAQ: RICK) issued new guidance to investors today based on anticipated revenues and earnings from the prospective purchase of a gentlemen's
club in the Dallas-Ft. Worth Metroplex.
The company said during a conference call that it anticipates the new club will generate annual revenues in excess of $4
million and about $800,000 in after tax net earnings in the first full year after the closing of the acquisition. Based on
an expected closing by the end of April, the DFW acquisition could add $0.06 per share during the second half of fiscal 2007.
At the end of December 2006, prior to making this acquisition, the company had projected EPS of $0.48.
In 2008, Rick's Cabaret expects that business from its current clubs will continue to improve. Strong upside is anticipated
from the club in New York as well as from the newly opened or re-launched clubs that are in their ramp-up phase. In addition,
the company's goal is to acquire clubs doing an additional $15 million in annual revenues. Rick's Cabaret has already identified
several potential acquisitions, although there is no guarantee that these specific acquisitions will be consummated. The company
believes that it will pay 3-6x earnings for these acquisitions.
Based on these assumptions, Rick's Cabaret believes that revenues in the year ending September 2008 will be $48-$50 million,
net income will be $6 million, and fully taxed EPS will be approximately $0.85.
Mr. Langan said factors that could impact earnings include the company's ability to locate potential targets to acquire,
complete its planned acquisitions and other new acquisitions, obtain satisfactory financing on acceptable terms and conditions
and grow revenues at existing clubs. The company has signed a letter of intent to acquire the club in the Dallas-Ft. Worth
area, but has not yet revealed the name or location of the establishment.
The company's estimates are based on management's budgets and estimates for the 13 clubs it currently owns or operates
and the acquisition of the Dallas-Ft. Worth club during 2007. The estimates for 2008 are based on management's budgets and
estimates for the 2007 clubs and acquisition plans for additional club purchases in 2007 and 2008.
The company anticipates normal debt service for the years ended September 30, 2007 and 2008, and anticipates the sale of
common stock during the year ended September 30, 2007 as part of its financing plan. If any changes in these activities were
to occur during the periods in question, the results of the company's operations would be affected and the company would amend
the guidance estimates.
About Rick's Cabaret
Rick's Cabaret International, Inc. (NASDAQ: RICK) operates upscale adult nightclubs serving primarily businessmen and professionals that offer live adult entertainment, restaurant
and bar operations. The company owns and operates or licenses adult nightclubs in New York City, New Orleans, Charlotte, Houston,
Minneapolis and other cities under the names "Rick's Cabaret," "XTC" and "Club Onyx." No sexual contact is permitted at any
of these locations. Rick's Cabaret also owns the adult Internet membership Web site, couplestouch.com, and a network of online
adult auction sites under the flagship URL naughtybids.com. Rick's Cabaret common stock is traded on NASDAQ under the symbol
RICK. For further information contact firstname.lastname@example.org.
This document contains 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 in this document, including: the risks and uncertainties
associated with operating and managing an adult business; the business climates in New York City and elsewhere; the success
or lack thereof in launching and building the company's businesses in New York City and elsewhere; the Company's ability to
identify and secure suitable locations for new nightclubs on acceptable terms, open the anticipated number of new nightclubs
on time and within budget; achieve anticipated rates of same-store sales; hire and train additional nightclub personnel and
integrate new nightclubs into its operations; unexpected increases in costs of sales or employee, pre-opening or other expenses;
the economic conditions in the new markets into which the Company expands and possible uncertainties in the customer base
in these areas; fluctuations in quarterly operating results; the impact of any negative publicity or public attitudes; competitive
pressure from other national and regional nightclub chains; risks and uncertainties related to the operational and financial
results of our Web sites, conditions relevant to real estate transactions, and numerous other factors such as laws governing
the operation of adult entertainment businesses, competition and dependence on key personnel. Rick's has no obligation to
update or revise the forward-looking statements to reflect the occurrence of future events or circumstances. For further information
go to www.ricks.com.