Troubled UK bingo and casino operator, the Rank Group (LON: RNK) has found itself back in profit once again for the past half year.
The owners of Mecca Bingo posted a pre-tax profit of £10.4 million for the six months to December 31st. The return to profit marked a significant turnaround from the £109.1 million loss recorded over the same period a year earlier.
Leading the return to profitability was a return by punters to the bingo venues that survived the heavy cull enacted by Rank Group PLC. The gambling firm reported that there was “busy trading” in its Mecca Bingo venues over Christmas and the New Year.
Despite a rise in wage costs, the group benefited from lower energy costs. Meanwhile, the business recorded a 9% increase in like-for-like net gaming revenues, as both its UK casinos and bingo halls enjoyed a higher footfall.
Improving Profitability
Rank Group PLC (LON: RNK) Chief executive John O’Reilly said of the latest half-year financial results:
“After what has been a very challenging few years for Rank due to a wide range of external macro factors, we are starting to build revenues and, with our strong operational leverage, we are improving our profitability, with the group delivering revenue and operating profit growth across all businesses.”
Last year, the UK government launched a white paper designed to shake up gambling, and reform casino venues. This, John O’Reilly believes will position the Rank Group in an even better position, as it expects to be able to double its gaming machines in its Grosvenor Casino venues once implemented. As well as allowing sports betting from the casino venues, the White Paper when implemented, will allow Rank to take electronic payments from its Bingo and Casino venues.
“Well Positioned”
Mr. O’Reilly added:
“We are well positioned to optimise the opportunities afforded by the UK Government’s planned land-based regulatory reforms which will hopefully be implemented through the passing of secondary legislation in the summer of 2024.
“These reforms cannot come soon enough in enabling us to modernise our proposition to better meet our customers’ expectations.”
Too Many Closures Too Soon?
The news that Rank is back in profit led by a rise in the number of customers visiting its bingo and casino venues will raise questions over the company’s decisions to close a number of long-established, popular bingo halls at the heart of communities all over the UK.
The devastating closure of bingo halls that have been around for more than half a century now looks a little short-sighted as demand for bingo shows no signs of slowing.
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