Rank Group returns to pre-tax profit
Rank Group has reported a £74.3m profit for the year ending June 30.
UK.- Rank Group, which operates the Mecca Bingo and Grosvenor Casinos brands, has announced that it returned to pre-tax profit in the year ending June 30. It’s reported a pre-tax profit of £74.3m, compared to a loss of £107.3m for the 2020-2021 year.
The recovery comes despite a difficult second half with challenging trading at Grosvenor Casino venues in London. Net gaming revenue was up 95 per cent to £644m after a year with long periods of closure and restrictions due to the Covid-19 pandemic in 2020-2021.
Rank said it expected trading to remain challenging for the months ahead due to high inflation. However, the group is advancing with its Transformation 2.0 programme. It closed seven Mecca Bingo venues in the first half of this year and last month sold its bingo hall in Telford for £5m. Grosvenor has invested £6.2m in new products and £5.3m in casino refurbishments including at Walsall.
Group underlying NGR is up three per cent in the first seven weeks of 2022-2023. Underlying digital NGR is up 12 per cent.
Group chief executive John O’Reilly said: “It was a challenging year for our UK venues businesses, with unexpectedly softer trading across the Grosvenor estate in the second half of the year.
“Our nine London casinos, which account for over 38 per cent of Grosvenor’s revenue in normal trading conditions, have seen very weak customer volumes with overseas visitors few in number, and only starting to return in the final few weeks of the year. The lower than expected Grosvenor trading in H2 led us to reset full year operating profit expectations.”
O’Reilly said Rank was seeking more efficiencies at land-based venues.
He said: “Performance in our digital business continues to improve against a difficult market backdrop. The transfer of the Rank brands to our proprietary technology platform is supporting revenue growth and a strong improvement to operating margins which we expect to accelerate with the migration of the Grosvenor brand in the coming weeks.
“We were disappointed by the delay to the publication of the UK government’s white paper on gambling regulation. The land-based casino and bingo sectors are in need of long overdue modernisation of the regulations which govern their operation, something which the government recognised in its objectives for the review. We expect Rank to be well positioned to benefit from the review when it concludes,” he added.
Earlier this month, Rank Group appointed Hazel Boyle as its new Chief People Officer (CPO). She joins Rank after serving in the same position at the publishing and media company Future plc. Boyle has also led recruitment and HR at WPP Plc’s Wunderman Thompson, M&G, ITV and ITN over her career.
Meanwhile, the UK’s Advertising Standards Authority (ASA) banned ads from Rank and Coral, upholding complaints from the public. It described both ads as “socially irresponsible”.
The Rank Group ad was a communication used in its Lucky Night mobile casino game to promote another casino game, Wolf Gold. The ad offered a £400 welcome bonus and featured the text: “Everyone wants to solve theirs [sic] financial problems. Click the download button right now and start to earn. In fact, it’s all very easy to do with our application. Pay off loans, buy a car and a nice house and make a lot of money!”
The ASA said the reference to financial problems and the phrase “start to earn” suggested that the app could be used to obtain a consistent income and financial security. It also said the ad suggested that the player would be able to make major purchases through gambling. The ad thus breached rules 16.1, 16.3, 16.3.1 and 16.3.4 of the CAP Code.
