RCI HOSPITALITY HOLDINGS, INC. Material Event - What Happened

Hey there! Let's break down what's going on with RCI Hospitality Holdings, Inc. (that's the company behind places like Rick's Cabaret and other entertainment venues, plus some restaurants). We're going to cut through the corporate speak and get to what you really need to know.

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1. What happened? (in plain English - the actual event)

RCI Hospitality just announced two big things:

First, they're going to need more time to file their full annual financial report (called a Form 10-K) for the year that ended on September 30, 2025. Think of the 10-K as the super-detailed, official financial yearbook for the company. They filed a special notice (Form 12b-25) with the SEC to let everyone know about this delay.

Second, even though the full report isn't ready, they did release some preliminary, unaudited financial results for the quarter and full fiscal year that ended September 30, 2025. "Preliminary" means these numbers might change slightly in the final report, and "unaudited" means they haven't been fully checked by independent accountants yet.

Here's a quick look at those preliminary numbers:

• Total revenues (money coming in): Down slightly. For the last quarter (4Q25), it was $70.9 million (compared to $73.2 million in 4Q24). For the full year (FY25), it was $279.4 million (down from $295.6 million in FY24).
• Nightclubs revenues: Stayed pretty steady, at $60.9 million for the quarter and $242.5 million for the year.
• Bombshells revenues (their restaurant chain): Saw a noticeable drop, down to $9.4 million for the quarter and $35.8 million for the year. The company mentioned this was mainly due to selling off five underperforming locations.
• Cash from operations: Also saw a decrease, with $13.7 million for the quarter and $49.4 million for the year.
• Share Buybacks: The company has been actively buying back its own shares, repurchasing about 3% of shares outstanding in FY25 and another 10% in the first quarter of FY26 (which started after Sept 30, 2025). This means fewer shares are available, which can be good for existing shareholders.

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2. When did it happen?

This news came out, or the event itself took place, on December 15, 2025, when RCI issued a press release about these preliminary results and the 10-K filing delay.

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3. Why did it happen? (context and background)

So, why did RCI do this? Well, companies like RCI are required to regularly report their financial performance to the public and their investors. It's a standard practice to keep everyone informed about how the business is doing.

The delay in filing the full 10-K report means they need more time to finalize all the complex financial details and get them checked by their auditors. This can happen for various reasons, but the company hasn't specified why yet.

They released the preliminary results to give investors some idea of how they performed, even though the full, official report isn't ready. It's a way to keep people informed while they work on the complete picture. The report covers their performance for the fiscal year and the last quarter ending September 30, 2025, giving a snapshot of their financial health, albeit a preliminary one.

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4. Why does this matter? (impact and significance)

This is the "so what?" moment. This event is a big deal for a few reasons:

• The Delay: When a company delays its annual report, it can sometimes make investors nervous because it suggests there might be complexities or issues they're working through. It means there's a bit more uncertainty until the final, audited numbers are released.
• Preliminary Numbers: While these numbers give us an early look, they're not final. Investors will be looking closely at the final report to see if anything changes.
• Performance Snapshot: The preliminary results show a mixed picture. While Nightclubs revenues held steady, the overall revenue and cash from operations saw a decline, largely due to the Bombshells segment. This tells us that some parts of their business are facing challenges, even as they work on their "Back to Basics" plan to improve things.
• Share Buybacks: The significant share buybacks (especially the 10% in 1Q26) are a strong signal from management that they believe their stock is undervalued. This can be seen as a positive move for shareholders, as it reduces the number of shares outstanding, potentially increasing the value of each remaining share.

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5. Who is affected? (employees, customers, investors, etc.)

• For RCI's Employees: While the report itself doesn't directly impact daily operations, the financial performance and strategic moves (like selling underperforming locations) can influence future company decisions regarding growth, hiring, or cost-cutting.
• For Customers: Generally, financial results don't directly affect customers unless there are significant changes in operations or offerings due to financial performance. The sale of some Bombshells locations might mean fewer options in certain areas.
• For Investors (that's you!): This is crucial information. The delay in the full report adds a layer of uncertainty, and the preliminary numbers give you an early, though not final, look at the company's performance. You'll be weighing the revenue declines against the company's strategic actions like share buybacks and portfolio adjustments (selling clubs, opening new concepts) to understand its future prospects and make investment decisions.

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6. What happens next? (immediate and future implications)

Now that this has happened, RCI has stated that as soon as they figure out when the full 10-K report will be filed, they will issue another news release announcing the date and time for their final earnings conference call. This means we'll have to wait a bit longer for the full, audited numbers and for management to discuss them in detail and answer questions from analysts and investors. We'll be watching for that announcement and how the market reacts to the specific numbers and management's plans.

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7. What should investors/traders know? (practical takeaways)

For those of you holding RCI stock or thinking about it:

• Understand the "Preliminary" aspect: These numbers aren't final or audited. While they give a good indication, be aware they could change slightly in the full 10-K report.
• The Delay Matters: A delayed 10-K can sometimes be a red flag, signaling potential issues or complex accounting. Keep an eye out for the reason behind the delay when the full report is eventually filed.
• Mixed Performance: While Nightclubs held steady, the overall revenue and cash flow declines, particularly in Bombshells, are worth noting. The company attributes the Bombshells drop to strategic divestitures, so consider if these sales are part of a larger, beneficial "Back to Basics" plan.
• Capital Allocation in Action: The company is actively managing its portfolio (selling clubs, opening new concepts) and aggressively buying back shares. The repurchase of about 10% of shares in 1Q26 is a significant move that could be positive for per-share metrics.
• Wait for the Full Picture: The company will hold an earnings call once the final 10-K is filed. That will be your chance to hear management's full explanation and outlook.
• Don't panic, don't overreact: Big news can cause stock prices to jump or drop quickly. Take a moment to understand the full picture before making any rash decisions, especially with preliminary data and a delayed full report.