Rick's Cabaret Reports Fiscal 2005 Results

HOUSTON -(January 5, 2006)- Rick's Cabaret International, Inc. [NASDAQ:RICK],the leading publicly traded operator of gentlemen's clubs, today reported results for its fiscal year ended September 30, 2005. Because of extraordinary one-time expenses in the fourth quarter associated with the opening of its new cabaret in New York City, the company reported a loss for the year, although same-location-same-period income was up.

"Heavy expenses in the fourth quarter required to complete our midtown Manhattan club were fully anticipated and are now behind us," said Eric Langan, President and CEO. "Our New York City club is now operating and beginning to contribute revenue and income."

The net loss for the year ended September 30th was $215,148, compared with net income of $775,253 in 2004. The full year 2005 results include $982,500 in losses attributed to opening and operating new clubs in New York City and Charlotte, NC. Net income for nightclub operations for the same-location-same-period increased by 3.78%. Net income for Internet operations for the same-web-site-same-period increased by 28.71%.

Total revenues for the year were $14,824,407, compared with $13,858,434 in 2004 (the 2004 figure has been restated to account for discontinued operations). Revenues increased by $965,973 or 6.97%, primarily due to new nightclub operations. Revenues from nightclub operations for same-location-same-period decreased by 0.74% and for Internet businesses by 0.98%.

Among the items contributing to the company's expenses in 2005 compared to 2004 were increases primarily associated with opening new clubs, including: payroll and related costs of $5,200,976 compared to $4,803,515 (payroll for nightclub operations for same-location-same-period decreased by 4.86%); general and administrative expenses of $7,458,721 compared to $6,036,401 due to increased taxes and permits, rent, legal and professional, utilities, advertising and marketing expenses; and interest expense of $699,678 compared to $324,411. The company had long-term debt of $13,246,836 as of September 30, 2005 compared to debt of $3,693,560 at the end of the previous year.

Rick's used $6,307,508 of cash in investing in 2005 compared to $867,206 for the previous, and $4,801,197 was provided by financing activities in 2005 compared to $153,749 used for the previous year.

"Our experience in New York City demonstrates that the strategy of acquiring new clubs in excellent business and tourism locations continues to be a sound foundation for building the overall business of Rick's Cabaret in the future," Mr. Langan said. "However, we do not anticipate that future acquisitions will entail the exceptionally high costs associated with New York, where unique circumstances required a complete remodel and other high start-up expenses. We anticipate that future acquisitions will be much more of a turnkey situation with faster accretion of revenue and profit.”

 The company did not change previously announced guidance for fiscal 2006 of revenues in the $23 -$24 million range and net income of about $2 million.

RICK'S CABARET INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
				September 30,
				2005		2004
Assets
Current assets:
	Cash and cash equivalents			$480,330		$275,243
	Accounts receivable:
		Trade		310,692		72,909
		Other		118872		204093
	Marketable securities			28919		122350
	Inventories			257626		232746
	Net assets of discontinued operations			-		27674
	Prepaid expenses and other current assets			87991		976577
Total current assets				1,284,430		1,911,592
Property and equipment, net				13,416,755		8,681,440
Other assets:
	Goodwill and indefinite lived intangibles			9,836,560		1,898,926
	Definite lived intangibles, net			126,262		-
	Other			365,011		268,919
Total other assets				10,327,833		2,167,845
Total assets				$25,029,018		$12,760,877
Liabilities and Stockholders' Equity
Current liabilities:
	Accounts payable			$1,034,508		$291,650
	Accrued liabilities			852,865		568,835
	Current portion of long-term debt			1,349,894		492,310
	Line-of-credit			94,888		-
Total current liabilities				3,332,155		1,352,795
Other long-term liabilities				193648		20048
Long-term debt				11,896,942		3,201,250
Total liabilities				15,422,745		4,574,093
Commitments and contingencies				-		-
Minority interest				31,337		40,808
Stockholders' equity:
	Preferred stock, $.10 par, 1,000,000 shares
	authorized, none outstanding			-		-
	Common stock, $.01 par, 15,000,000 shares
	authorized, 5,220,678 and 4,608,678 shares issued, respectively			52207		46087
	Additional paid-in capital			13004567		11273149
	Accumulated other comprehensive income			15572		109002
	Accumulated deficit			-2203630		-1988482
				10868716		9439756
	Less 908,530 shares of common stock held in treasury, at cost			1,293,780		1,293,780
Total stockholders' equity				9,574,936		8,145,976
Total liabilities and stockholders' equity				$25,029,018		$12,760,877

About Rick's Cabaret
Rick’s Cabaret International, Inc. (NASDAQ: RICK, www.ricks.com) operates upscale adult nightclubs serving primarily businessmen and professionals that offer live adult entertainment, restaurant and bar operations. The company owns, operates or licenses adult nightclubs in New York City, New Orleans, Charlotte, Houston, Minneapolis and other cities under the names "Rick's Cabaret," "XTC," “Club Onyx” and “Hummers.” No sexual contact is permitted at any of these locations. Rick’s Cabaret also owns the adult Internet membership Web site, www.couplestouch.com, and a network of nine online auction sites for adult products under the flagship URL www.naughtybids.com. Rick’s Cabaret common stock is traded on the NASDAQ SmallCap market under the symbol RICK. For further information contact ir@ricks.com.

Forward-Looking Statements:
This document contains 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 in this document, including the risks and uncertainties associated with operating and managing an adult business, the business climates in New York City and elsewhere, the success or lack thereof in launching and building the company’s businesses in New York City and elsewhere, risks and uncertainties related to the operational and financial results of our Web sites, conditions relevant to real estate transactions, and numerous other factors such as laws governing the operation of adult entertainment businesses, competition and dependence on key personnel. Rick's has no obligation to update or revise the forward-looking statements to reflect the occurrence of future events or circumstances. For further information go to www.ricks.com.

Contact for further information: Allan Priaulx, 212-338-0050, ir@ricks.com