Rci Hospitality Holdings Stock Earnings Reports

RCI Hospitality reported Q2 2025 revenue of $65.9M (down from $72.3M y/y) driven primarily by the sale/divestiture of five underperforming Bombshells locations and severe winter weather that depressed January–February same-store sales. Adjusted EBITDA was $14.2M (vs. $17.2M prior year) and non-GAAP EPS was $0.65 (vs. $0.90). GAAP net income improved to $3.2M ($0.36/share) vs. $0.8M a year ago, helped by materially lower impairments ($2.1M vs. $8.2M). The company repurchased 56,875 shares for $2.9M and finished the quarter with ~8.8M shares outstanding and $32.7M in cash. Strategic actions included two nightclub acquisitions (Flight Club — Detroit; Platinum West — SC), opening Bombshells Denver, reformatting Chicas Locas El Paso, and continuing to dispose of underperforming Bombshells sites. Bombshells segment revenue declined significantly and the company is evaluating improvements, new openings and potential divestitures. Debt increased modestly (driven by the Flight Club purchase and development projects) and net leverage rose to ~3.56x trailing 12-month adjusted EBITDA; management expects leverage to decline as sales recover with warmer weather and newly opened locations ramp. Key operating headwinds this quarter were the bad-weather impact and lower VIP/bottle service spend; management quantified the weather impact and expects a markedly better trajectory in Q3 as comps normalize. The company reiterated its five‑year "Back to Basics" capital allocation plan: allocate free cash flow ~40% to acquisitions and 60% to buybacks/debt repayment/dividends, target annual FCF/share growth of 10–15%, and five‑year targets (by FY'29) of ~$400M revenue, ~$75M free cash flow, ~7.5M shares outstanding and roughly $10 FCF/share. Short-term focus: drive nightclub same-store sales, continue opportunistic M&A at target multiples (3x–5x adjusted EBITDA), improve Bombshells margins toward a 15% operating margin, complete remaining developments, and continue share repurchases.