The Rank Group reported a 2 percent rise in revenue for the initial three-month period of its 2022-23 financial year, primarily fueled by expansion in its digital operations.
In a business update, Rank revealed that its net gaming income for the period ending September 30th amounted to £165.6 million (€189.2 million/$183.6 million).
Rank’s physical Grosvenor Casinos business contributed significantly to this overall figure, although the £75.3 million generated during the quarter represented a 5 percent decrease compared to the previous year.
The company stated that while customer visits increased, spending per customer experienced a decline. Rank observed that this trend was more than counterbalanced by a 17 percent drop in revenue from its locations outside of London, where customer spending levels are generally lower.
Mecca Bingo venue revenue climbed 2 percent year-over-year to £33.3 million, with a 4 percent increase in customer visits offsetting a 2 percent decrease in spending per customer. Rank also highlighted that its Enracha venues in Spain witnessed a 24 percent surge in revenue, reaching £8.2 million.
Focusing on online operations, Rank’s digital activities saw revenue increase by 13 percent to £48.9 million, driven by a 13 percent rise in UK online activity and a 12 percent increase in Spanish online activity.
Grosvenors’ online income rose by a quarter, Rank reported, with the brand continuing to perform well after effectively transitioning to the RIDE platform in early September.
John O’Reilly, Rank’s chief executive, stated: “It’s heartening to witness sustained growth in traffic and robust digital business performance in the new fiscal year. We are starting to observe the positive effects of our investment in our proprietary technological platform and multi-channel services, with expansion in both the UK and Spain being promising.”
Mecca’s digital revenue climbed by 1%, while the rest of the UK’s digital business saw a 23% increase in revenue, Rank noted, with the Stride brand on the RIDE platform exhibiting particularly strong growth.
Looking ahead, Rank indicated that despite the positive impact of the UK energy price cap and the influence of rising interest rates, consumer discretionary spending is anticipated to remain under pressure this year, with inflation likely to persist at elevated levels for a period.
Rank expressed its approval of the recently announced energy bill relief program, and because the program is in place for six months starting in October 2022 and ending in March 2023, the group expects energy expenses of approximately £34 million in the current fiscal year, compared to £23 million in the previous year.
Rank stated that this presumes no further assistance is provided after March of next year, and the group will be exposed to market prices in the final three months of the current fiscal year.
The company has stated that they have put into action a series of programs designed to boost efficiency and decrease future energy use.
Furthermore, the company has indicated that wage inflation, escalating food input costs, and supply chain pressures are all contributing to rising expenses. These inflationary pressures are continuing to present a significant obstacle, particularly within their venue operations.
The company has also mentioned that expenditures in the current fiscal year will be elevated due to the reduced rate of discounts and temporary leave pay received in the initial quarter of the preceding fiscal year, which was impacted by the pandemic.
“Despite the challenging market conditions, which we anticipate will persist in the coming months, we remain dedicated to providing Rank’s top-tier, engaging, and entertaining offerings to our clientele,” stated O’Reilly.
“The organization is implementing a range of crucial initiatives aimed at enhancing long-term revenue. These include several key renovation projects at Grosvenor, along with the introduction of new electronic roulette and jackpot games; enhancing the gaming machine offerings at Mecca; increasing personalization and strengthening the live casino offerings within the UK digital business; and the recent launch of Yo Sports in Spain.
“The organization possesses a robust financial position, which empowers us to continue investing in the business during this period.”
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