Gambling company Rank bounces back quickly following Omicron slump
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Gambling company Rank has marked its return to profitability in the six months ended 31 December, as a result of improved revenue performance in subsidiaries such as casino company Grosvenor as well as bingo firms Mecca and Enracha.
After a Covid-induced slump, Rank’s profits went up to £24.1 compared with the £41.2m loss registered last year. The statutory group’s operating profits rocketed 295 per cent to £103m following a VAT repayment worth £83m.
Out of all Rank’s subsidiary, Grosvenor was the one that performed better, growing steadily in the first half of the year until restrictions were re-introduced following the emergence of Omicron.
“Grosvenor has demonstrated high customer demand in the absence of Covid-19 restrictions, particularly when the travel restrictions for tourists coming into the UK were largely removed in October, resulting in much improved table handle in our London venues,” said Rank Group’s chief executive John O’Reilly.
“Mecca has been harder hit, as caution amongst our older customer cohort has impacted visit numbers, particularly with the rising Omicron case numbers in the run up to Christmas.”
Rank’s digital business also performed strongly, registering a 7 per cent growth in active customers and 37 per cent increase in marketing investments. In January, Rank completed the transition of online bingo website meccabingo.com to proprietary trading platform RIDE, while Grosvenor’s is expected to take place in the summer.
“Whilst the trading environment continues to be challenging and cost headwinds are applying additional pressure on the hospitality sector, we have proven that with no restrictions, our trading rebounds quickly,” O’Reilly added.
“Rank is well positioned to regain the robust revenue and profit growth momentum we had created before the pandemic struck. We have strengthened the balance sheet and, with the return to profitability and cash generation, we have been able to accelerate our transformation programme to drive faster revenue growth as restrictions are lifted.”
Commenting on the results, Edison Group’s director of consumer and media Russell Pointon said: “There is a confident tone in Rank’s interim results as it has returned to profitability, and a more positive outlook as it looks forward to trading with fewer Covid-related restrictions.
“Coupled with a much stronger balance sheet, the company is accelerating investment in its continuing transformation programme and resumption of dividend payments will be considered when allowed.
“Rank retains a clear ambition to reach £1bn of revenue by FY23, versus current Refinitiv consensus of c £820m, and pre-Covid revenue of c £700m.”
