RANK PLC RESULTS RELEASED
09th February, 2012 at 03:28:00
Six and twelve months numbers posted
The online and land gambling company Rank Group plc has posted its six and twelve month results to end December 2011 showing good growth in most of its online interests and recording final victory in a long running tax overpayment dispute with HM Customs and Excise that brought £ 253 million back into the gambling company's coffers.
The company also responded to press speculation that it was in talks to acquire the Gala Coral
group, confirming that the reports were true.
Key highlights for the group overall show increased customer numbers, revenue and operating profit with a particularly strong performance from Grosvenor's G Casinos, and:
· Strong balance sheet with £ 25 million of net cash
- Net debt £ 123.4 million at 31 December 2010
· European Court of Justice decision in Rank's favour on £ 253 million VAT overpayment claims
· Customer satisfaction score up six percentage points to 51% across the Group's gaming-based entertainment brands
Financial highlights in six months ended 31 December 2011
· Group revenue of £ 295.9 million (H2 2010: £ 286.7 million)
· Statutory revenue of £ 282.7 million (H2 2010: £ 274.9 million)
· Group EBITDA before exceptional items of £ 53.1 million (H2 2010: £ 49.2 million)
· Group operating profit before exceptional items of £ 34.6 million (H2 2010: £ 33.4 million)
· Group operating profit after exceptional items of £ 21.7 million (H2 2010: £ 9.3 million)
· Adjusted profit before tax of £ 32.5 million (H2 2010: £ 30.1 million)
Financial highlights in the 12 months ended 31 December 2011
· Group revenue of £ 589.9 million (2010: £ 567.8 million)
· Group EBITDA before exceptional items £ 100.9 million (2010: £ 92.3 million)
· Group operating profit before exceptional items £ 64.1million (2010: £ 62 million)
· Adjusted profit before tax £ 58.8 million (2010: £ 55.2 million)
Entering its 75th year, Rank celebrated the success of a very 21st century activity in its Interactive division, reporting good results from its internet and mobile gambling offerings.
"In 2011 we have focused our innovation efforts on the effective delivery of our brands through mobile devices, including the release of twenty high quality mobile applications," Management reported. "As a result, mobile gaming achieved 200% revenue growth or 6.7% of the business's total revenue in 2011 as nearly a quarter of our customers chose to use this channel.
"Revenue continued to grow strongly during the six months ended 31 December 2011 (up 24.8% to £ 37.8 million) driven by increasing revenue from meccabingo.com. Operating profit also increased compared to the same period in 2010, up 14.3% to £ 6.4 million."
Marketing spend on the interactive operations was increased, and there is clearly an appreciation of the importance of mobile gambling in the company's assessment of the business in the future, with Management noting:
"We believe that the increasing prevalence of gaming via mobile communications devices (such as smartphones and tablets) represents a structural change within our industry. Understanding how the availability of gaming-based entertainment via mobile devices affects consumer choice and using that insight for competitive advantage is a key challenge for the Group.
"Through Rank Interactive we have made some good progress in terms of product development, launching the world's first real money bingo 'app' in 2010; and becoming an early adopter of mobile sports betting via Blue Square. In addition, we offer mobile gaming on a local area network to customers of our Mecca venues via more than 7,500 Mecca Max electronic gaming units. We are looking into the opportunities to use similar technology in Grosvenor Casinos."
The report breaks down Rank's interactive revenues as follows:
Bingo up 30.2% to £ 28.9 million in H2 2011 (H1 2011 - £ 22.2 million) and up 30.5% over the full year to £ 54.8 million.
Sports up 10.9% to £ 5.1 million in H2 2011 (H1 2011 - £ 4.6 million) and up 15.9% to £ 9.5 million over the full year 2011.
Casino up 18.5% to £ 3.2 million in H2 2011 (H1 2011 - £ 2.7 million) and up 8.8% to £ 6.2 million over the fiull year 2011.
Poker fared less well, down 25% to £ 600 000 (H1 2011 - £ 800 000) and down 27.8% to £ 1.3 million over the full year.
Related News Tags: Mobile Gambling, Coral, Gala, Grosvenor