Rank FY revenue drops despite digital growth
Full year results show revenue down 8.2 per cent for the Grosvenor Casinos operator.
UK.- The Rank Group has reported a drop in revenue and net profit for its 2020 financial year despite solid online growth.
Net gaming revenue for the 12 months ending June 30 was down 8.2 per cent year-on-year to £638.1m, mainly owing to the closure of land-based venues due to the Covid-19 pandemic.
Operating profit fell 39.7 per cent to £23.5m. Net profit dropped 67.7 per cent to £9.4m.
The group’s digital business boomed, with revenue brought in from the Grosvenor and Mecca sites in the UK, Yo bingo in Spain and Passion Gaming in India climbing 22.6 per cent year-on-year to £145.3m.
The digital business is now the company’s second largest source of income after the land-based Grosvenor Casinos in Britain.
But Rank’s land-based venues in the UK, Spain and Belgium were all forced to close for several months at the height of lockdown measures.
The Grosvenor Casinos chain in Britain remains its biggest income generator, but with casinos closed for five months from mid-March revenue fell 18.4 per cent to £275.9m.
The group’s Mecca Bingo venues reopened on July 4, earlier than casinos, but were also closed for the last months of the group’s financial year. Their contribution to revenue fell 30.1 per cent to £128.4m.
Revenue from the overseas chains Enracha in Spain and Casino Blankenberge in Belgium also fell due to pandemic-related closures. The international venues brought £35.5m, down 20.9 per cent year-on-year.
Rank said it took several measures to mitigate the impact of Covid-19 and placed more than 7,600 staff on furlough but it saw only a minimal fall in expenses in the financial year, down 0.6 per cent to £616m.
Rank chief executive, John O’Reilly, said: “Despite continued good growth in our digital brands, with our venues closed from mid-March the impact of the Covid-19 pandemic on the group has been significant.
“However, with the huge commitment and dedication of our colleagues, very tight cost control across the business and the support we have received from government, we have carefully navigated the past few months and are now beginning to successfully emerge.”
The group said that since reopening, its Mecca venues in the UK had achieved around 70 per cent of prior-year revenues in July and August with visitor numbers at 55 per cent of those seen last year.
But Grosvenor venues in London, which usually generate more than half of Grosvenor’s revenues, were achieving around 40 per cent of prior-year revenues. The casinos outside of London were achieving around 75 per cent.
Enracha venues in Spain were making around 65 per cent of the revenues seen last year.
O’Reilly said: “We’ve been encouraged by the first few weeks of trading following reopening and whilst the supply-side constraints, including social distancing and changes to the way we operate table gaming, are going to be challenging over the coming months, the response from customers to the extensive safety measures we have in place has been very positive.
“The post-lockdown expectations of customers who are looking for ways to safely enjoy their leisure time and spend will be higher than ever and we are determined to ensure our brands are well-positioned to benefit from this shift.”
