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Rank shares positive outlook on the back of first-quarter growth

Thu, 14th Oct 2021 11:40

(Alliance News) - Rank Group PLC on Thursday said trading in the first quarter of its financial year was in line with expectations, with like-for-like net gaming revenue up 69% to GBP163.1 million.

The Maidenhead, Berkshire-based company operates Grosvenor Casinos and Mecca bingo parlours.

It expects full-year like-for-like net gaming revenue of between GBP700 million and GBP750 million, with gaming operating profit of between GBP50 million to GBP75 million. Underlying net gaming revenue was GBP288.2 million in financial 2021, down from GBP575.6 million the year before. The underlying operating loss last year was GBP67.2 million, swung from a GBP48.4 million profit.

Revenue in Rank's Grosvenor venues more than tripled year-on-year in the three months to September 30, but was still 20% down compared to the same quarter two years ago. Mecca venues net gaming revenue grew by 41% on last year but was down 22% on two years ago.

As trading restrictions in Spain began to gradually ease, Rank's Enracha venues net gaming revenue grew by 20% year-on-year and was down 21% on two years ago.

Rank said its UK digital business "returned to growth" in the quarter, with Grosvenor digital net gaming revenue growing 12% on the back of its omni-channel players. Mecca digital net gaming revenue grew by 6%, but Rank's other brands had a mixed performance as the casino business was offset by revenue declines in bingo.

"We have seen an excellent response from our customers as they return to our venues, with our colleagues doing a great job in ensuring they are being properly entertained within a safe environment," said Chief Executive John O'Reilly.

"Whilst forecasting remains difficult as we emerge from the pandemic in an environment of volatile costs and numerous supply chain challenges, we are confident that trading will continue to improve across each of our businesses during the remainder of the year."

Rank is now targeting a GBP10 million increase in full year capital expenditure to GBP50 million.

In August, Rank said it was set to receive a VAT refund of around GBP80 million, after back and forth with HM Revenue & Customs regarding VAT that was charged on slot machine income between April 2006 and January 2013.

Rank shares were up 2.5% at 163.36 pence in London on Thursday.

By Josie O'Brien; josieobrien@alliancenews.com

Copyright 2021 Alliance News Limited. All Rights Reserved.

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