Rank Group Revenue Slumps But Transformation Plan Proving Profitable

Rank Group, the parent company of Grosvenor Casinos and Mecca Bingo, has said digital innovations and cost-cutting have helped revive its flagging finances.

Rank Group Grosvenor Casinos

Operating revenue for the Rank Group is down due to decreased spending at Grosvenor Casinos and Mecca Bingo halls. (Image: Evening Telegraph)

Publishing its preliminary results for the 12 months to June 30, 2019, Rank showed a 22 percent slump in operating profit.

Fuelling the drop from £50.1 million to £39 million over the last year was decreased footfall and a decline in high roller spending.

Offline Revenue Falls

As outlined in the August 22 report, revenue on a like-for-like basis across its network of live venues was down two percent. However, despite offline earnings taking a dive, the Rank Group’s online assets were gaining momentum.

Digital contributions to group revenue increased by 17 percent, with net gaming revenue (NGR) growing 23 percent.

This rise in online income was helped by the recent acquisition of YoBingo. By purchasing QSB Gaming Limited in May 2019, the Rank Group increased its presence in Europe.

With YoBingo controlling 30 percent of Spain’s online bingo market, Rank it looking to build a solid revenue stream outside the UK.

Indeed, alongside the takeover of QSB, it made a move for Stride Gaming in May. The deal is valued at a reported £115 million and is expected to complete towards the end of 2018.

For CEO of the Rank Group, John O’Reilly, this acquisition is another positive step in its ongoing transformation programme.

“The acquisition of Stride will help step change our digital business, deliver strong synergies and bring proprietary technology in house,” O’Reilly said.

Rank Group Acknowledges Challenges but Remains Buoyant

Expanding on the company’s recent performance, O’Reilly remarked on the challenges it’s faced over the last 18 months. However, by cutting staff, selling five Mecca Bingo halls and increasing its online portfolio, he’s confident the downswing is taking a positive turn.

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,” O’Reilly continued.

While revenue across the Rank Group’s live casino network is down, a recent deal with Ricoh Arena will be seen as a positive.

Continuing a partnership that started in 2009, the latest agreement will see Grosvenor Casinos remain a focal point within the sports and entertainment complex for the next decade.

Between this and its digital growth, the opportunities for growth are there. Much like Ladbrokes Coral and William Hill have shifted their focus, Rank will use its online assets can counter increasingly tougher operating conditions in the UK.

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