Rank reports 48% net gaming revenue loss due to closed operations during lockdown

Rank Group shared preliminary results for the 12 months ended 30 June 2021 on August 19, reporting a £72 million ($98.4 m) loss versus a £9.4 million ($12.8 m) profit in the 2019/2020 period. Net gaming revenue for the period totaled £329.6 million ($450.5 m), 48% less than £629 million ($859.9 m) in the prior period.

“The year to 30 June 2021 was exceptionally challenging for the group and, frankly, we are delighted it is over,” said John O’Reilly, Chief Executive of Rank Group Plc. “We are now well into a new financial year with our venues open and trading positively.”

The company took a hit during the past year due to Covid, as 79% of the group’s revenue is derived from its venues businesses. Closures imposed in response to the pandemic amounted to 59% of available operating days together with capacity constraints and reduced opening hours, among other restrictions.

Despite the setbacks suffered during the last period, the company believes it has achieved encouraging progress since its UK venues reopened on 17 May. “Our venues have been performing ahead of our expectations following the easing of restrictions,” described O’Reilly, and further growth is anticipated when travel restrictions eventually ease and tourism returns.

Grosvenor venues in the 13-week period to 15 August have posted an average weekly revenue of £5.7 million ($7.7 m), ahead of cash breakeven level of £4.4 million ($6.0 m). And since restictions were eased on 19 July, average weekly revenue has been £6.0 million ($8.2 m).

In Mecca, revenue over the same 13-week period was £2.6 million ($3.5 m), marginally ahead of the cash breakeven level of £2.4 million ($3.2 m).

According to O’Reilly, there is a “renewed sense of confidence” as the company focuses in its growth initiatives. Moreover, digital trading has been in line with company expectations since the start of the new financial year, supported by an increased flow of omni-channel customers from venues following reopening.

“Rank was delivering strong revenue and profit growth before the pandemic and the steps we have taken over the last 18 months, particularly in carefully managing our liquidity and developing the transformation plans, will enable the group to return to that growth trajectory,” further remarked Rank’s CEO.

Among the actions taken to secure sufficient liquidity, the company sold Casino Blankenberge in Belgium for £25.2 million ($34.4 m). As a result, closing cash and available facilities totaled £98.0 million ($133.9 m) as at 30 June 2021. The group is confident that it will continue to meets its liquidity and covenant tests, according to a press release.

“This has been a year of transition for our UK facing digital business,” remarked O’Reilly, while admitting “revenue has disappointed.” However, the company has been making “good progress” with the development of its proprietary technology platform and expects the complete migration of the Rank brands during 2021/22.

This would free up development capability to enable “much greater agility and speed” to market for new and enhanced products, services and digital customer experiences. Digital revenue is expected to grow throughout the year.