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What were the key takeaways from RCI Hospitality's earnings call?

- **Stable Nightclub Performance**: Despite economic headwinds, Nightclub revenue held steady, with Bombshells margin improving to 1%. 
- **Strategic Acquisitions**: $6 million+ in free cash flow from 2 new nightclubs and steakhouse; $3 million share buyback. 
- **Financial Recovery**: Net income turned positive ($4.1M vs. -$5.2M YoY), free cash flow stable at $13.3M. 
- **Key Risks**: Liquor sales down 3.9%, self-insurance reserves $9.4M YTD, and delayed captive insurance setup. 
- **Long-Term Growth**: Targeting $400M revenue by 2029, doubling free cash flow per share to $10.

**【CEO Summary Section】**
- Nightclub revenues remained stable despite economic challenges, with Bombshells revenue increasing sequentially due to new locations and improved margins. 
- Acquired 2 upscale nightclubs (Platinum West and Platinum Plus) and opened Rick's Cabaret Steakhouse in Colorado. 
- Purchased 75,000 shares for $3 million, reducing shares outstanding to 8.76 million. 
- Post-quarter, opened a successful Bombshells in Lubbock, Texas. 
- Long-term goals include $400 million revenue, $75 million free cash flow, and doubling free cash flow per share by 2029. 

**【CFO Financial Commentary】**
- Q3 2025 total revenue $71.1 million (-6.5% YoY) due to Bombshells divestitures. 
- Net income $4.1 million ($0.46 EPS) vs. loss of $5.2 million (-$0.56 EPS) YoY. 
- Free cash flow $13.3 million (flat YoY), adjusted EBITDA $15.3 million (-24% YoY). 
- Nightclub segment: Revenue $62.3 million (-1% YoY), GAAP margin 28.5% (vs. 21.7% YoY). 
- Bombshells: Revenue $8.6 million (-33% YoY), margin 1% (vs. -68% YoY). 
- Corporate expenses $8.7 million (+18% YoY) due to self-insurance reserves. 

**【Q&A Highlights】**
- **Real Estate Sales**: $28 million in nonperforming real estate; potential $85 million offer to sell Bombshells segment. 
- **Insurance Reserves**: Year-to-date $9.4 million in self-insurance charges; captive insurance expected by Q4 2025 to reduce noncash expenses. 
- **Acquisition Strategy**: Targeting $6 million EBITDA annually, 3-5x multiples, 100% cash-on-cash returns. 
- **Liquor Sales Decline**: 3.9% YoY, offset by slight service revenue growth. 
- **Share Buybacks**: 15.5% reduction in shares outstanding since 2015; flexible buyback strategy based on valuation.

RCI Hospitality Holdings, Inc. (RICK) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

RICK

RICK fundamentals

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