Rank expects to beat full year operating profit forecasts
The Rank Group has said that it is likely to post better-than-expected operating profit for the 12 months through to 30 June, 2020, due to positive trading within its digital and Grosvenor Casino and international land-based venues businesses.
Based on the trends experienced to date, Rank said operating profit for the year is now expected to amount to between £105m (€122.9m/$137.1m) and £115m. Rank, which also operates the Mecca bingo brand, had initially forecast operating profit to be in the range of £93m to £103m for the full year period.
However, the performances of its digital and the Grosvenor and international venues divisions, together with cost savings from its transformation programme, meant that it was able to increase this guidance.
Rank said the guidance is based on performance before taking into account the impact of International Financial Reporting Standard (IFRS) 16, which provides additional guidance on accounting for leases.
The operator said that it expects IFRS16 to have a positive impact of £8m on its operating profit, with this offset by increase in finance costs. As a result, when accounting for IFRS16, operating profit is likely to amount to between £113m and £123m.
Rank intends to announce its interim results for the six months to 31 December, 2019 later this month.
Should the full-year results meet these updated forecasts, they would reflect the trends Rank experienced during the first quarter of its 2019-20 financial year.
Rank reported a year-on-year increase in gross gaming revenue for the three months to 30 September 2019, citing growth in its digital arm and Grosvenor Casino land-based business.
Gross gaming revenue was up 8% on a like-for-like basis in the first quarter of the year, while like-for-like net gaming revenue, which represents GGR less player incentives, was up 10%.