RCI Hospitality steps up implementation of capital strategy
RCI said it has implemented the following steps in 4Q16, which ended September 30: Sold two clubs, one that was unprofitable and one just over breakeven. Decided to move and reformat two clubs to increase revenues and margins. Closed the only Bombshells restaurant that was not profitable. Initiated plans for two new Bombshells, using bank financing to increase return potential. Sold the majority of its interest in the US distribution of Robust energy drink. Refinanced $14.2M at lower average rates, moving all non-realty balloon payments to 2021. And since June 30, RCI has paid off the last convertible debentures that had warrants, eliminating the potential share dilution. RCI also announced continued share repurchases in 4Q16 and the settlement of the last of the most serious cases remaining from the insolvency of its prior insurer. Some of the actions are expected to result in gains and some in non-cash charges when RCI announces its final 4Q16 results, which are expected to be reported December 14.