Rank Group H2 profits climb despite ‘tough first half’ of the year

Publishing its H2 2018/19 results for the six month period ending 30 June 2019, Rank Group has reported that it’s experienced an ‘encouraging start to 2019/20’, despite reporting a decline in footfall in its Grosvenor Casino and Mecca Bingo properties.

Following what it described as a ‘tough first half’ to the year, Rank Group has reported that its operating profits have climbed by 20% while its full-year profits had taken a 22% hit since last year, dropping from £50.1m to £39m.

John O’Reilly, chief executive of The Rank Group, commented: “We are pleased with the Group’s second-half performance and the full-year results, especially given the challenges we faced in the first half of the year. The transformation programme is pivotal to our growth strategy both in the UK and internationally.

“We are excited by the important initiatives that are being implemented across each of our businesses. We have made a good start to the transformation of Rank and there remains a lot of improvement to be delivered. I would like to thank my colleagues across the Group for their enthusiasm and commitment in delivering   improvements in the ways in which we are meeting the needs of our customers.”

But despite the drop in revenues, Rank’s digital business is reported to have experienced a strong period of growth, with like-for-like H2 net gaming revenue (NGR) up 14% compared to the H1 growth of 7%.

The gambling operator also reported that its like-for-like NGR had grown by 11% over the year, following a number of improvements to its customer bonusing and offers from its Mecca and Grosvenor divisions – however this figure is not inclusive of the Rank-acquired YoBingo.

Total digital revenue grew by 17% in the year due to the contribution from YoBingo, while digital like-for-like operating profit was down 3% in the year as improvements to revenue were offset by £0.8m of incremental Remote Gaming Duty (‘RGD’) on player bonuses and £1.9m of additional RGD following its increase to 21% (from 15%) from 1 April 2019.

During the period, Rank had confirmed that it has entered ‘advanced discussions’ to acquire London AIM-listed online gambling group Stride Gaming Plc.

The acquisition is hoped to significantly boost the online gaming presence of Rank, which will also see them absorb a number of the Stride UK bingo brands, including Kitty Bingo, Lucky Pants, Bingo Extra and Lucky VIP, Regal Wins and Spin&Win online casino properties.

O’Reilly added: “The acquisition of Stride, which we expect to complete in 2019/20, will help step-change our digital business, deliver strong synergies, bring proprietary technology in house and create one of the UK’s leading online gaming businesses.”

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