Rick's Cabaret Reports Record Fiscal 2006 Revenue Of Nearly $24.5 Million And Net Income Over $1.7 Million

Conference Call to Discuss Results Scheduled for Dec. 28th at 4:30 p.m. ET

HOUSTON -(December 28, 2006)- Rick's Cabaret International, Inc. [NASDAQ:RICK], the publicly traded chain of gentlemen's clubs, reported revenues of $24,487,215 for the year ending September 30, 2006, a 65 percent increase over the previous year’s total of $14,824,407. The company had net income from operations of $1,752,714 for its fiscal year ending September 30, 2006, compared with a loss of $215,148 in the prior year.

The company said it earned 38 cents per basic share for the year, compared with a loss of five cents per basic share in fiscal 2005. The net income for the year was impacted by one-time events totaling $320,000 for settlement of a lawsuit, loss on a real estate transaction and goodwill impairment, plus a loss of $330,000 in connection with newly acquired clubs.

"The excellent performance of Rick's Cabaret-New York City gave us a strong revenue boost for the fiscal year and this club continues to grow steadily each month," said Eric Langan, President and CEO of Rick's Cabaret. "Our growth program is on track and we are looking forward to another strong year in 2007 from our existing clubs and the four acquisitions we have made recently. We will also continue to look at additional acquisitions that fit our business model and can be quickly accretive."

Mr. Langan will host a conference call to discuss the results at 4:30 p.m. ET December 28th. Callers in the United States can participate by calling toll free, 877-407-8031. International callers should dial 201-689-8031. The conference call will be available at www.ricks.com and through Vcall at http://www.vcall.com/IC/CEPage.asp?ID=112421. Teleconference replay is available until 11:59 p.m. on January 3, 2007 in the U.S. toll free at 877-660-6853 and from international points at 201-612-7415. The replay passcodes (both required for playback) are account number 286 and Conference ID number 225251.

Highlights from the company's Form 10KSB filed with the Securities and Exchange Commission include:

• The 65.18 percent increase in revenues in 2006 over the previous year came from stronger revenues at both new and existing nightclubs, including the New York location, which contributed for a full twelve months compared to one month in 2005.
• Revenues from nightclub operations for same-location-same-period increased by 25.12 percent year over year.
• Income from continuing operations for nightclub operations for the same-location-same-period increased by 51.26 percent year over year.
• Internet revenue totaled $801,395 for the year, compared with $787,617 in the previous year. We expect to continue to grow our Internet profit centers by focusing on high margin activities.
• Net income from operations for Internet businesses was $138,351 for the year compared with $114,501 for the previous year.
• Net income for Internet operations for the same-website-same-period increased by 20.83 percent over the previous year.
• At September 30, 2006, the company had cash and cash equivalents of $854,932 compared to $480,330 at September 30, 2005. Net cash provided by operating activities in the year was $2,725,770 compared to $2,090,030 for the previous year.
• Cost of goods sold was 11.91 percent of total revenues compared to 12.59 percent of related revenues for the previous year.
  General and administrative expenses for the year were $11,498,862 compared to $7,458,721 for the previous year, primarily because of the increase in taxes and permit, rent, legal and professional, utilities, insurance, plus advertising and marketing expenses from opening new locations and the New York City location, which was open for the full year.
• Interest expense for the year was $1,057,020 compared with $699,678 in the previous year, due primarily to increase in debt for the purchase and renovation of the New York club. Long term debt is now $13,920,733, compared with $13,246,836 in the previous year.