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(Alliance News) - Rank Group PLC on Thursday said it swung to an annual profit, boosted by the lifting of Covid restrictions, but warned of tricky times to come with consumer discretionary spending expected to fall due to inflation and rising living costs.
For the year to June 30, the gambling firm reported a pretax profit of GBP74.3 million versus a loss of GBP107.3 million a year prior.
Revenue surged 95% to GBP644.0 million from GBP329.6 million.
"Year-on-year comparisons for our venues are distorted by significant periods of closure, curfews and regional restrictions in the 2020/21 financial year," the company cautioned.
Rank explained it saw a boost in revenue per customer at Spain-based business Yo and Enracha and from late June saw some trading improvement from the lifting of Covid-19 restrictions at UK-based Grosvenor.
The Maidenhead, England-based gambling firm said it still recommends no dividend, unchanged from a year ago.
Referring to its 52 Grosvenor venues, the firm said: "Whilst all imposed Covid-19 restrictions were removed in late January, visitor volumes, particularly across the London estate of nine venues which account for over 38% of revenues in a normal trading year, remained very weak until late June when some improvement was seen."
Commenting on the UK government's announced gambling law changes, Rank said: "Whilst the delay to the publication of the UK government's gambling review white paper is disappointing, we continue to build support for a programme of modest reforms for the land-based casino and bingo sectors," Rank said, referring to a 2020 release by the UK government which said it aimed to modernise gambling laws to make them fit for the digital age."
Chief Executive Officer John O'Reilly said the land-based casino and bingo markets are in dire need of regulatory "modernisation".
"We expect Rank to be well positioned to benefit from the review when it concludes," O'Reilly added.
Looking ahead, O'Reilly said: "Whilst we have been seeing improvements in London in recent weeks, the trading environment across the UK is likely to remain difficult in the months ahead with inflationary pressures squeezing consumer discretionary expenditure and cost increases, particularly in energy prices, putting pressure on profit margins."
Rank Group shares were 2.3% lower at 85.94 pence each in London on Thursday morning.
By Tom Budszus; tombudszus@alliancenews.com
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