The Rank Group, despite a substantial 220.5% surge in income during the third quarter of the 2021-22 fiscal year, has nevertheless reduced its full-year EBIT forecast.
For the three months ending on March 31, 2022, the group’s net gaming income reached £156.4 million (€188.2 million/$204.2 million), a considerable increase from the £48.7 million recorded in the previous year.
Rank attributed this growth to the normal operation of its retail locations during the period, in contrast to the previous year when these facilities were largely closed due to the UK’s Covid-19 restrictions.
As a consequence, Grosvenor venues generated £69.1 million in revenue during the third quarter of the current fiscal year, compared to a mere £100,000 in the same period last year.
Mecca venues witnessed a significant rise in revenue from £300,000 to $34.1 million, while Enricha venues in Spain generated £8 million in revenue, representing a 263.6% increase from £2.2 million in the third quarter of the 2020-21 fiscal year, when these venues were open for a portion of the quarter, albeit subject to strict capacity limitations.
Shifting focus to digital operations, its UK-facing digital operations experienced a 1.5% decline in revenue, reaching £40 million. Grosvenor digital revenue, however, saw a 3% increase.
Grosvenor locations operated by Rank are still performing well due to online shoppers, but their Mecca digital income experienced a decrease of 11% following the transition to the RIDE platform in January.
Rank’s other online brands are performing adequately, with some brands experiencing a growth of 42% on the RIDE platform, while other brands not owned by Rank have seen a decline of 25% due to price limitations imposed by other companies in the first half of 2021-22.
Rank’s international online operations also experienced a reduction of 5.5%, reaching £5.2 million.
Looking forward, Rank anticipates that the upcoming months will be sluggish for their Grosvenor locations due to a decrease in visitor numbers during this time of year. They expect an increase in activity after April, but they are uncertain about the number of individuals returning to the city or traveling to London during the summer.
As a result, Rank is revising their profit forecast for the entire year to a range of £47 million to £55 million, a reduction from the initial range of £55 million to £65 million.
Rank’s Chief Executive Officer, John O’Reilly, stated, “We observed a decline in business at our locations in March, and this trend has persisted into the initial weeks of the new quarter, impacting our expectations for the entire year.”
We recognize the challenging circumstances British consumers are facing, but we are confident that our continuous enhancements to our offerings and investments in our stores, coupled with the easing of the pandemic and the return of international travelers, will position us favorably for the upcoming year.”
In the recent quarter, Rank paid £700,557 in regulatory settlement charges to the UK Gambling Commission following an assessment in May 2021.
The Commission stated that Rank’s method of determining when individuals were gambling excessively “was not consistently effective,” particularly for new patrons, and that they “over-relied” on a £1,000 loss limit over a 30-day period.
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