Rank reports 98% revenue rise for FY22 but “difficult” trading conditions lie ahead
The Rank Group has published preliminary results for the 12 months ended 30 June 2022, recording £40.4m ($48.7m) in underlying operating profit.
For fiscal year 2022, Rank’s bottom-line was in the black following a loss of £82.4m for 2020/21. The group’s improved profitability came as a result of a 98% rise in underlying net gaming revenue (NGR).
The prior year was “heavily impacted” by Covid-related closures, said Rank, which adversely affected the group’s top-line.
However, Rank’s underlying NGR has now almost doubled to £644m from last year’s £325.3m. This was driven by a 209% rise in venues’ underlying NGR, reflecting a post-pandemic return to more normal operating conditions.
Digital’s underlying NGR, meanwhile, experienced a 4% increase year-on-year. While this segment’s growth was more modest, it constitutes a 27% hike when compared to calendar year 2019. Venues’ NGR, meanwhile, remains below 2019 levels, as does Rank’s overall NGR.
Ultimately, the group’s profit was in line with guidance issued in June, when Rank downgraded its expectations from a previously guided range of £47m-£55m.
Rank’s decision to lower its guidance was prompted by “difficult trading conditions in Grosvenor venues, particularly in London.”
“It was a challenging year for our UK venues businesses, with unexpectedly softer trading across the Grosvenor estate in the second half of the year,” said John O’Reilly, The Rank Group’s CEO.
“Our nine London casinos, which account for over 38% of Grosvenor’s revenue in normal trading conditions, have seen very weak customer volumes with overseas visitors few in number, and only starting to return in the final few weeks of the year.”
Going forward, O’Reilly expects trading conditions to remain “difficult,” due in large part to current macroeconomic factors.
He commented: “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.”
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