The Rank Group PLC (GB:RNK) reported a pre-tax loss in its 2023 earnings despite an uptick in its revenues. The company stated that the second half exhibited a more robust performance as customers returned to its casinos after the difficult past couple of years. With the favorable trends seen in the 2023 figures, the company is expecting significant growth in revenue and profits for the fiscal year 2024.
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The Ranks Group is an entertainment and leisure company known for its gaming brands and casino venues. The company has brands like Grosvenor Casinos and Mecca Bingo, Enracha venues, and more under its portfolio.
Preliminary Numbers For 2023
The group’s net gaming revenue gained 6% to £681.9 million, up from £644 million a year ago. The underlying profit for 2023 reached £20.3 million, aligning with the updated guidance projected in April yet marking a decrease from the previous year’s profit of £42.5 million.
The second half demonstrated better performance compared to the first half, with a like-for-like underlying operating profit of £16.1 million, in contrast to the mere £4.2 million.
Despite the revenue increase, the underlying operating profit for venues amounted to £40.9 million, indicating a decline of 27% from the previous year. This decrease is attributed to substantial cost escalations, particularly a rise in staff expenses and energy costs.
Post-results, the shares lost 0.56% and closed at 88.5p after touching 90p during the day. The shares started the year on a rough note but gained momentum. YTD, the shares have gained 11.7% in trading.
Favorable Outlook
The company’s business has recovered and comes out of a period of higher costs, fewer visitors, and a tight economic environment. However, with declining inflation, stabilizing energy prices, and the return of customers to its venues, the company anticipates substantial year-on-year revenue growth and an enhancement in its profitability.
Rank Group is also confident in its digital business, with a robust lineup of customer-oriented innovations for both our UK and Spanish brands. The robustness of its balance sheet also empowers ongoing investments in both the digital and venue sectors, strategically positioning the company for prospective expansion.
So far in the fiscal year 2024, the company has witnessed robust performance across its business, resulting in a noteworthy 16% year-on-year increase in overall underlying group like-for-like Net Gaming Revenue (NGR). For the first six weeks of FY 2024, Grosvenor venues have experienced a 17% upsurge, accompanied by a 13% rise in visits. Similarly, Mecca Venues’ NGR is up by 17%, and Enracha Venues’ NGR is 12% above last year’s numbers.
