Rank Group sees pre-tax profits fall despite digital surge

Rank Group saw pre-tax profits fall and revenue plateau during the last financial year despite a strong digital performance.

In announcing its results for the 12 months to the end of June, the owner of Grosvenor Casinos and Mecca Bingo said like-for-like revenue was up 1% year-on-year to £754.0m (€825.8m/$972.7m), while the statutory figure was flat at £707.2m.

Profit before taxation after exceptional items was down 7% to £79.7m during 2016-17, while group EBITDA was flat at £128.8m and group operating profit was up 1% to £83.5m.

The company’s adjusted profit before tax was up 2% to £79.3m.

The financial highlight of the year was a 15% rise in UK digital revenue to £111.5m and a 63% jump in UK digital operating profit to £22.7m.

Rank also saw a surge during the second half of the year, with operating profit at £46.9m in the six months to June 30, compared to £36.6m for the prior period.

Operationally, the company launched its new retail bingo format, Luda, earlier this month, and said there will be two more opening in Q2 2017-18.

However, in what the company described as a “challenging UK retail environment”, its venues division’s operating profit was down 9% to £88.2m and like-for-like revenue fell 1% to £642.5m.

“After a challenging first half of our financial year, we are very pleased with our second half performance, especially with our digital business which delivered 63% growth in operating profit for the year,” said chief executive Henry Birch.

“We are excited about the roll-out of our new Luda bingo concept following the opening of the first venue on August 7.

“Additionally, the group has put in place a number of digital, product and venue-based initiatives launching in the current financial year which we expect to drive top line revenues.

“The new financial year has started well and the board looks to the future with confidence.”

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