PR Newswire | Dec 14, 2021 04:06PM EST

12/14 15:05 CST

RCI Reports Record Fourth Quarter Revenues, Annual Revenues, and Cash Generation HOUSTON, Dec. 14, 2021

HOUSTON, Dec. 14, 2021 /PRNewswire/ -- RCI Hospitality Holdings, Inc. (Nasdaq: RICK) today reported results for the fiscal 2021 fourth quarter and year ended September 30, 2021, and filed its Form 10-K.

4Q21 Highlights FY21 Highlights

* Total revenues of $54.9 million vs. $28.8 million in 4Q20 * Total revenues of $195.3 million * EPS of $0.26 vs. loss per share vs. $132.3 million in FY20 of $0.31 in 4Q20 * EPS of $3.37 vs. loss per share of * Non-GAAP EPS* of $1.58 vs. $0.15 $0.66 in FY20 in 4Q20 * Non-GAAP EPS* of $4.08 vs. $0.51 * Net cash from operating in FY20 activities of $9.8 million and * Net cash from operating activities free cash flow* of $8.5 million of $42.0 million and free cash * Net income of $2.3 million vs. flow* of $36.1 million net loss of $2.9 million in 4Q20 * Net income of $30.2 million vs. * Adjusted EBITDA* of $17.6 million net loss of $6.3 million in FY20 vs. $4.4 million in 4Q20 * Adjusted EBITDA* of $60.2 million * $35.7 million cash and vs. $22.4 million in FY20 equivalents at 9/30/21

4Q21 and FY21 included non-cash impairments of $11.9 million and $13.6 million, respectively. While most clubs rebounded significantly throughout the year, the full year contribution from clubs in certain locations with more stringent COVID-19 restrictions did not recover as fast as previously projected.

Eric Langan, President and CEOof RCI Hospitality Holdings, Inc., stated: "We ended FY21 with record fourth quarter revenues, annual revenues, and cash generation. A special thanks to our teams for their outstanding performance managing COVID-19 restrictions, reopening challenges earlier in the year, the Delta variant, inflation, and labor issues in the fourth quarter. We're working full steam ahead on executing our plan for FY22. This includes improving the customer experience at our new club acquisitions, scouting for new clubs to buy, the recent opening of our new company-owned Bombshells Arlington, the upcoming opening of our franchisee-owned Bombshells San Antonio, developing new company-owned and franchised Bombshells locations, and launching our AdmireMe mobile friendly site."

Conference Call Today at 4:30 PM ET

* Live Participant Phone: Toll Free 888-506-0062, International 973-528-0011, Passcode: 484746 * Live webcast, slides or replay link: https://www.webcaster4.com/Webcast/Page/2209/43856 * Phone replay: Toll Free 877-481-4010, International 919-882-2331, Passcode: 43856

Meet Management Tonight at 6:00 PM ET

* Investors are invited to meet management at one of RCI's top revenue generating clubs * Rick's Cabaret New York, 50 W. 33rd Street, New York, NY, between Fifth Avenue and Broadway * RSVP your contact information to gary.fishman@anreder.com by 5:00 PM ET today

4Q21 Segments

* Nightclubs: 4Q21 revenues of $40.3 million, operating margin of 16.1% (43.2% non-GAAP), and income from operations of $6.5 million ($17.4 million non-GAAP), with 36 clubs open the full quarter. Florida clubs did particularly well. Higher-margin service revenues continued to grow. GAAP results included the previously mentioned $11.9 million impairment and a $1.0 million gain on insurance. 4Q21 improved significantly compared to 4Q20 when 16 clubs were open the full quarter and 34 by quarter end, reflecting COVID restrictions. Compared to pre-COVID 4Q19, 4Q21 revenues increased 12% and income from operations increased 4% (58% non-GAAP). * Bombshells: 4Q21 revenues of $14.4 million, operating margin of 20.8%, and income from operations of $3.0 million. All 10 locations were open the full quarter. This compares to 4Q20 revenues of $15.5 million, operating margin of 33.0%, and income from operations of $5.1 million, when sales benefitted from an unusually strong sports schedule and Bombshells being one of the few venues open in its markets. Compared to pre-COVID 4Q19, revenues increased 69% on 25% more units and operating margin expanded 11.9 percentage points.

4Q21 Consolidated(comparisons to 4Q20 and % are of total revenues unless indicated otherwise)

* Margin improvements in cost of goods sold (14.9% vs. 15.6%), salaries and wages (25.6% vs. 28.5%), and SG&A (27.6% vs. 41.0%) primarily reflected higher Nightclubs sales and cost-saving initiatives. * Other charges of $11.9 million included the previously mentioned impairment and $1.0 million from settlement of lawsuits, partially offset by other gains of $1.0 million from insurance. * Operating margin was 6.6% vs. 0.7%. Non-GAAP operating margin was 28.4% vs. 8.0%. * Interest expense increased $0.5 million due to costs and charges related to the previously announced debt refinancing, but declined as a percentage of revenues, to 5.3% from 8.4%. * Income taxes were a benefit of $1.6 million compared to an expense of $0.8 million. Both periods adjusted for the full year tax rate. 4Q21 also included $0.6 million benefit from a change in deferred tax asset valuation allowance. * Debt was $125.2 million at 9/30/21 compared to $127.6 million at 6/30/21. This reflected scheduled paydowns and a $1.2 million paydown related to a sold property.

FY21 vs. FY20

* Total revenues increased 48% to $195.3 million, primarily due to a 55% increase in Nightclubs to $137.3 million and a 31% increase in Bombshells to a record $56.6 million. * Compared to FY20, which was more severely affected by COVID-19 restrictions, most clubs opened to their full capacity and operating hours over the course of FY21, while Bombshells restaurants opened to their full capacity and operating hours as of the first half of March 2021. * As a result, operating margin expanded to 19.7% from 2.1% of revenues. On a non-GAAP basis, which excludes the previously-mentioned $13.6 million impairment and other charges (gains), operating margin expanded to 26.7% from 10.5% of revenues.

Note

* As of the release of this report, we do not know the future extent and duration of the impact of COVID-19 on our businesses. We will continually monitor and evaluate our cash flow situation to determine whether any measures need to be instituted. * All references to the "company," "we," "our," and similar terms include RCI Hospitality Holdings, Inc., and its subsidiaries, unless the context indicates otherwise.

*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) impairment of assets, (c) gains or losses on sale of businesses and assets, (d) gains or losses on insurance, and (e) settlement of lawsuits. 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 attributable to RCIHH common stockholders and diluted earnings per share. Adjustment items are: (a) amortization of intangibles, (b) impairment of assets, (c) costs and charges related to debt refinancing, (d) gains or losses on sale of businesses and assets, (e) gains or losses on insurance, (f) unrealized loss on equity securities, (g) settlement of lawsuits, (h) gain on debt extinguishment, (i) the income tax effect of the above-described adjustments, and (j) change in deferred tax asset valuation allowance. Included in the income tax effect of the above adjustments is the net effect of the non-GAAP provision for income taxes, calculated at 13.5%, 26.0%, and 15.5% effective tax rate of the pre-tax non-GAAP income before taxes for the 2021, 2020, and 2019, 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 attributable to RCIHH common stockholders: (a) depreciation and amortization, (b) income tax expense (benefit), (c) net interest expense, (d) gains or losses on sale of businesses and assets, (e) gains or losses on insurance (f) unrealized gains or losses on equity securities, (g) impairment of assets, (h) settlement of lawsuits, and (i) gain on debt extinguishment. 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 the unleveraged performance return on our investments. Adjusted EBITDA multiple is also used as a target benchmark for our acquisitions of nightclubs. * Management also uses 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)www.rcihospitality.com

With more than 50 units, RCI Hospitality Holdings, Inc., through its subsidiaries, is the country's leading company in gentlemen's clubs and sports bars/restaurants. Clubs in New York City, Chicago, Dallas-Fort Worth, Houston, Miami, Minneapolis, Denver, St. Louis, Charlotte, Pittsburgh, Raleigh, Louisville, and other markets operate under brand names such as Rick's Cabaret, XTC, Club Onyx, Vivid Cabaret, Jaguars Club, Tootsie's Cabaret, and Scarlett's Cabaret. Sports bars/restaurants operate under the brand name Bombshells Restaurant & Bar.

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 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, (vi) the impact of the COVID-19 pandemic, and (vii) numerous other factors such as laws governing the operation of adult entertainment 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, 2021, 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

RCI HOSPITALITY HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share and percentage data)

For the Three Months Ended September 30, For the Twelve Months Ended September 30,

2021 2020 2021 2020

Amount % of Amount % of Amount % of Amount % of Revenue Revenue Revenue Revenue

Revenues

Sales of alcoholic $ 23,960 43.6% $ 13,795 47.9% $ 86,685 44.4% $ 59,080 44.6% beverages

Sales of food and 10,906 19.9% 7,082 24.6% 41,111 21.1% 24,460 18.5% merchandise

Service 17,019 31.0% 6,714 23.3% 55,461 28.4% 41,162 31.1% revenues

Other 3,056 5.6% 1,195 4.2% 12,001 6.1% 7,625 5.8%

Total 54,941 100.0% 28,786 100.0% 195,258 100.0% 132,327 100.0% revenues

Operatingexpenses

Cost of goods sold

Alcoholic beverages 4,270 17.8% 2,271 16.5% 15,883 18.3% 11,097 18.8% sold

Food and merchandise 3,833 35.1% 2,167 30.6% 13,794 33.6% 8,141 33.3% sold

Service and 70 0.3% 49 0.6% 374 0.6% 197 0.4% other

Total cost of goods sold 8,173 14.9% 4,487 15.6% 30,051 15.4% 19,435 14.7% (exclusive of items shown below)

Salaries and 14,071 25.6% 8,204 28.5% 50,627 25.9% 39,070 29.5% wages

Selling, general and 15,141 27.6% 11,803 41.0% 54,608 28.0% 51,692 39.1% administrative

Depreciation and 2,041 3.7% 2,140 7.4% 8,238 4.2% 8,836 6.7% amortization

Other charges 11,898 21.7% 1,960 6.8% 13,186 6.8% 10,548 8.0% (gains), net

Total operating 51,324 93.4% 28,594 99.3% 156,710 80.3% 129,581 97.9% expenses

Income from 3,617 6.6% 192 0.7% 38,548 19.7% 2,746 2.1%operations

Other income(expenses)

Interest (2,913) -5.3% (2,408) -8.4% (9,992) -5.1% (9,811) -7.4% expense

Interest 59 0.1% 61 0.2% 253 0.1% 324 0.2% income

Non-operating gains (26) 0.0% 39 0.1% 5,330 2.7% (64) 0.0% (losses), net

Income (loss)before income 737 1.3% (2,116) -7.4% 34,139 17.5% (6,805) -5.1%taxes

Income taxexpense (1,551) -2.8% 769 2.7% 3,989 2.0% (493) -0.4%(benefit)

Net income 2,288 4.2% (2,885) -10.0% 30,150 15.4% (6,312) -4.8%(loss)

Net lossattributable to 12 0.0% 92 0.3% 186 0.1% 227 0.2%noncontrollinginterests

Net income(loss)attributable to $ 2,300 4.2% $ (2,793) -9.7% $ 30,336 15.5% $ (6,085) -4.6%RCIHH commonshareholders

Earnings (loss)per share

Basic and $ 0.26 $ (0.31) $ 3.37 $ (0.66) diluted

Weightedaverage sharesoutstanding

Basic and 9,000 9,124 9,005 9,199 diluted

Dividends per $ 0.04 $ 0.03 $ 0.16 $ 0.14share

RCI HOSPITALITY HOLDINGS, INC.

NON-GAAP FINANCIAL MEASURES

(in thousands, except per share and percentage data)

For the Three Months For the Twelve Months

Ended September 30, Ended September 30,

2021 2020 2021 2020

Reconciliationof GAAP netincome (loss)to AdjustedEBITDA

Net income(loss)attributable $ 2,300 $ (2,793) $ 30,336 $ (6,085)to RCIHHcommonstockholders

Income taxexpense (1,551) 769 3,989 (493)(benefit)

Interest 2,854 2,347 9,739 9,487expense, net

Settlement of 1,069 100 1,349 174lawsuits

Impairment of 11,940 1,423 13,612 10,615assets

Gain on saleof businesses (67) (16) (522) (661)and assets

Gain on debt - - (5,329) -extinguishment

Unrealizedloss (gain) on 26 (39) 84 64equitysecurities

Loss (gain) on (1,044) 453 (1,253) 420insurance

Depreciationand 2,041 2,140 8,238 8,836amortization

Adjusted $ 17,568 $ 4,384 $ 60,243 $ 22,357EBITDA

Reconciliationof GAAP netincome (loss)to non-GAAPnet income

Net income(loss)attributable $ 2,300 $ (2,793) $ 30,336 $ (6,085)to RCIHHcommonstockholders

Amortization 49 147 258 609of intangibles

Settlement of 1,069 100 1,349 174lawsuits

Impairment of 11,940 1,423 13,612 10,615assets

Gain on saleof businesses (67) (16) (522) (661)and assets

Gain on debt - - (5,329) -extinguishment

Unrealizedloss (gain) on 26 (39) 84 64equitysecurities

Loss (gain) on (1,044) 453 (1,253) 420insurance

Costs andchargesrelated to 694 - 694 -debtrefinancing

Change indeferred taxasset (632) 1,273 (632) 1,273valuationallowance

Net income tax (143) 799 (1,845) (1,700)effect

Non-GAAP net $ 14,192 $ 1,347 $ 36,752 $ 4,709income

Reconciliation of GAAP diluted earnings (loss)per share to non-GAAP diluted earnings per share

Diluted shares 9,000 9,124 9,005 9,199

GAAP dilutedearnings $ 0.26 $ (0.31) $ 3.37 $ (0.66)(loss) pershare

Amortization 0.01 0.02 0.03 0.07of intangibles

Settlement of 0.12 0.01 0.15 0.02lawsuits

Impairment of 1.33 0.16 1.51 1.15assets

Gain on saleof businesses (0.01) (0.00) (0.06) (0.07)and assets

Gain on debt - - (0.59) -extinguishment

Unrealizedloss (gain) on 0.00 (0.00) 0.01 0.01equitysecurities

Loss (gain) on (0.12) 0.05 (0.14) 0.05insurance

Costs andchargesrelated to 0.08 - 0.08 -debtrefinancing

Change indeferred taxasset (0.07) 0.14 (0.07) 0.14valuationallowance

Net income tax (0.02) 0.09 (0.20) (0.18)effect

Non-GAAPdiluted $ 1.58 $ 0.15 $ 4.08 $ 0.51earnings pershare

Reconciliation of GAAPoperating income to non-GAAPoperating income

Income (loss)from $ 3,617 $ 192 $ 38,548 $ 2,746operations

Amortization 49 147 258 609of intangibles

Settlement of 1,069 100 1,349 174lawsuits

Impairment of 11,940 1,423 13,612 10,615assets

Gain on saleof businesses (67) (16) (522) (661)and assets

Costs andchargesrelated to 57 - 57 -debtrefinancing

Loss (gain) on (1,044) 453 (1,253) 420insurance

Non-GAAPoperating $ 15,621 $ 2,299 $ 52,049 $ 13,903income

Reconciliationof GAAPoperatingmargin tonon-GAAPoperatingmargin

GAAP operating 6.6% 0.7% 19.7% 2.1%margin

Amortization 0.1% 0.5% 0.1% 0.5%of intangibles

Settlement of 1.9% 0.3% 0.7% 0.1%lawsuits

Impairment of 21.7% 4.9% 7.0% 8.0%assets

Gain on saleof businesses -0.1% -0.1% -0.3% -0.5%and assets

Costs andchargesrelated to 0.1% 0.0% 0.0% 0.0%debtrefinancing

Loss (gain) on -1.9% 1.6% -0.6% 0.3%insurance

Non-GAAPoperating 28.4% 8.0% 26.7% 10.5%margin

Reconciliation of net cashprovided by operatingactivities to free cash flow

Net cashprovided by $ 9,774 $ 3,485 $ 41,991 $ 15,632operatingactivities

Less:Maintenance 1,299 40 5,907 2,151capitalexpenditures

Free cash flow $ 8,475 $ 3,445 $ 36,084 $ 13,481

RCI HOSPITALITY HOLDINGS, INC.

SEGMENT INFORMATION

(in thousands)

For the Three Months For the Twelve Months

Ended September 30, Ended September 30,

2021 2020 2021 2020

Revenues

Nightclubs $ 40,333 $ 13,134 $ 137,348 $ 88,373

Bombshells 14,403 15,531 56,621 43,215

Other 205 121 1,289 739

$ 54,941 $ 28,786 $ 195,258 $ 132,327

Income(loss) fromoperations

Nightclubs $ 6,502 $ 54 $ 43,815 $ 13,056

Bombshells 3,001 5,128 13,264 9,237

Other (72) (191) 35 (614)

General (5,814) (4,799) (18,566) (18,933) corporate

$ 3,617 $ 192 $ 38,548 $ 2,746

RCI HOSPITALITY HOLDINGS, INC.

NON-GAAP SEGMENT INFORMATION

($ in thousands)

For the Three Months Ended September 30, 2021 For the Three Months Ended September 30, 2020

Nightclubs Bombshells Other Corporate Total Nightclubs Bombshells Other Corporate Total

Income(loss) from $ 6,502 $ 3,001 $ (72) $ (5,814) $ 3,617 $ 54 $ 5,128 $ (191) $ (4,799) $ 192operations

Amortizationof 46 3 - - 49 48 4 96 - 148intangibles

Settlement 38 21 - 1,010 1,069 100 - - - 100of lawsuits

Impairment 11,940 - - - 11,940 1,423 - - - 1,423of assets

Costs andchargesrelated to 17 - - 40 57 - - - - -debtrefinancing

Loss (gain)on sale of (82) 16 - (1) (67) (20) - - 3 (17)businessesand assets

Loss (gain) (1,044) - - - (1,044) 453 - - - 453on insurance

Non-GAAPoperating $ 17,417 $ 3,041 $ (72) $ (4,765) $ 15,621 $ 2,058 $ 5,132 $ (95) $ (4,796) $ 2,299income(loss)

GAAPoperating 16.1% 20.8% -35.1% -10.6% 6.6% 0.4% 33.0% -157.9% -16.7% 0.7%margin

Non-GAAPoperating 43.2% 21.1% -35.1% -8.7% 28.4% 15.7% 33.0% -78.5% -16.7% 8.0%margin

For the Twelve Months Ended September 30, 2021 For the Twelve Months Ended September 30, 2020

Nightclubs Bombshells Other Corporate Total Nightclubs Bombshells Other Corporate Total

Income(loss) from $ 43,815 $ 13,264 $ 35 $ (18,566) $ 38,548 $ 13,056 $ 9,237 $ (614) $ (18,933) $ 2,746operations

Amortizationof 187 14 57 - 258 211 15 383 - 609intangibles

Settlement 275 59 5 1,010 1,349 174 - - - 174of lawsuits

Impairment 13,612 - - - 13,612 10,370 245 - - 10,615of assets

Costs andchargesrelated to 17 - - 40 57 - - - - -debtrefinancing

Loss (gain)on sale of (580) 72 - (14) (522) (639) 16 - (38) (661)businessesand assets

Loss (gain) (1,209) - - (44) (1,253) 433 - - (13) 420on insurance

Non-GAAPoperating $ 56,117 $ 13,409 $ 97 $ (17,574) $ 52,049 $ 23,605 $ 9,513 $ (231) $ (18,984) $ 13,903income(loss)

GAAPoperating 31.9% 23.4% 2.7% -9.5% 19.7% 14.8% 21.4% -83.1% -14.3% 2.1%margin

Non-GAAPoperating 40.9% 23.7% 7.5% -9.0% 26.7% 26.7% 22.0% -31.3% -14.3% 10.5%margin

RCI HOSPITALITY HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

For the Three Months Ended For the Twelve Months Ended

September 30, September 30, September 30, September 30, 2021 2020 2021 2020

CASH FLOWS FROMOPERATINGACTIVITIES

Net income $ 2,288 $ (2,885) $ 30,150 $ (6,312)(loss)

Adjustments toreconcile netincome (loss)to net cash

provided byoperatingactivities:

Depreciation and 2,041 2,140 8,238 8,836 amortization

Deferred income tax (823) 249 (1,253) (1,268) expense (benefit)

Gain on sale of businesses (88) (28) (714) (777) and assets

Impairment of 11,940 1,423 13,612 10,615 assets

Unrealized loss (gain) on 26 (39) 84 64 equity securities

Amortization and write-off of debt 151 42 311 236 discount and issuance costs

Gain on debt - - (5,298) - extinguishment

Noncash lease 447 416 1,729 1,660 expense

Loss (gain) on (1,043) 629 (1,337) 596 insurance

Doubtful accounts expense (58) 107 (80) 602 (reversal) on notes receivable

Changes in operating assets and liabilities:

Accounts (5,078) (241) (769) (294) receivable

Inventories (180) 255 (287) 226

Prepaid expenses, other current 1,774 (3,309) 4,120 1,633 assets, and other assets

Accounts payable, accrued, and (1,623) 4,726 (6,515) (185) other liabilities

Net cash provided by 9,774 3,485 41,991 15,632 operating activities

CASH FLOWS FROMINVESTINGACTIVITIES

Proceeds fromsale of 2,202 180 5,415 2,221businesses andassets

Proceeds from 858 - 1,152 945insurance

Proceeds fromnotes 35 21 130 1,576receivable

Payments forproperty andequipment and (2,723) (171) (13,511) (5,736)intangibleassets

Net cash provided by (used in) 372 30 (6,814) (994) investing activities

CASH FLOWS FROMFINANCINGACTIVITIES

Proceeds fromdebt 36,314 - 38,490 6,503obligations

Payments ondebt (38,333) (1,343) (49,178) (8,832)obligations

Purchase of - (996) (1,794) (9,484)treasury stock

Payment of (360) (366) (1,440) (1,286)dividends

Payment of loanorigination (1,174) - (1,174) -costs

Distribution tononcontrolling - - - (31)interests

Net cash used in financing (3,553) (2,705) (15,096) (13,130) activities

NET INCREASE INCASH AND CASH 6,593 810 20,081 1,508EQUIVALENTS

CASH AND CASHEQUIVALENTS AT 29,093 14,795 15,605 14,097BEGINNING OFPERIOD

CASH AND CASHEQUIVALENTS AT $ 35,686 $ 15,605 $ 35,686 $ 15,605END OF PERIOD

RCI HOSPITALITY HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands)

September 30, September 30,

2021 2020

ASSETS

Current assets

Cash and cash equivalents $ 35,686 $ 15,605

Accounts receivable, net 7,570 6,767

Current portion of notes 220 201 receivable

Inventories 2,659 2,372

Prepaid expenses and other 1,928 6,488 current assets

Assets held for sale 4,887 -

Total current assets 52,950 31,433

Property and equipment, net 175,952 181,383

Operating lease right-of-use 24,308 25,546assets, net

Notes receivable, net of current 2,839 2,908portion

Goodwill 39,379 45,686

Intangibles, net 67,824 73,077

Other assets 1,367 900

Total assets $ 364,619 $ 360,933

LIABILITIES AND EQUITY

Current liabilities

Accounts payable $ 4,408 $ 4,799

Accrued liabilities 10,403 14,573

Current portion of long-term 6,434 16,304 debt, net

Current portion of operating 1,780 1,628 lease liabilities

Total current liabilities 23,025 37,304

Deferred tax liability, net 19,137 20,390

Long-term debt, net of currentportion and debt discount and 118,734 125,131issuance costs

Operating lease liabilities, net 24,150 25,439of current portion

Other long-term liabilities 350 362

Total liabilities 185,396 208,626

Commitments and contingencies

Equity

Preferred stock - -

Common stock 90 91

Additional paid-in capital 50,040 51,833

Retained earnings 129,693 100,797

Total RCIHH stockholders' 179,823 152,721 equity

Noncontrolling interests (600) (414)

Total equity 179,223 152,307

Total liabilities and $ 364,619 $ 360,933 equity

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SOURCE RCI Hospitality Holdings, Inc.