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Listen to this article:If you enjoy visiting your local Mecca Bingo club, then there is good news. Rank Group, the owner of Grosvenor Casinos and Mecca Bingo, has reported strong performance for the financial year ending 30 June 2024. It said that its growth can be attributed to favourable trading conditions and key technological advancements.
The company said that its performance was boosted by a decrease in inflation and an increase in disposable income within the UK market. There was growth across both its digital and land-based operations and the group saw a 9% year-on-year increase in like-for-like net gaming revenue (NGR) to £734.4 million.
Furthermore, the group’s digital cross-channel customer revenue outpaced overall growth, rising 16% over the year. This was mainly due to its proprietary technology platform, which underwent several successful upgrades over the year. Rank highlighted the impact of its unified content management system across all digital platforms and an improved Grosvenor app, making it one of the best platforms among online bingo sites in the UK.
Grosvenor is the largest division within Rank and it reported a 9% increase in NGR to £331.3 million from its venues. However, the revenue from Mecca Bingo also saw impressive growth of 8% and it reached £136.6 million. At the same time, the Spanish land-based brand Enracha saw a 7% rise and reached £38.5 million. On the digital front, NGR climbed by 12% to £226 million, with the UK and Spanish markets expanding by 11% and 16%, respectively.
While Rank has not disclosed specific figures for Q4, the company mentioned “strong trading” during the last quarter. It said that like-for-like NGR grew by 14% compared to the previous year, and it is expected that this will provide “good momentum into 2024-25.”
In terms of profitability, Rank’s like-for-like underlying operating profit for the year was £46.5 million.
This was above analysts’ expectations and it more than doubled the previous year’s £20.1 million. Rank has been actively trying to reduce costs and it reported real progress in improving expenditure controls. A cost-cutting initiative, introduced in December 2022, was part of the company’s strategy to address a prior drop in operating profit within Grosvenor.
Capital expenditure for the 2023-24 financial year was £46.7 million, slightly up from £44.1 million the previous year. This spending covered investments in both the group’s venues and its proprietary technology. Employment costs also rose by 11%, driven by wage inflation and the reinstatement of staff bonuses.
As a sign of confidence in the company’s outlook and good news for shareholders, Rank’s board has recommended resuming dividend payments. A full-year dividend of 0.85p is proposed, with an interim dividend planned for January 2025.
Chief Executive John O’Reilly commented on the company’s progress, saying:
“This has been a year of strong financial, operational, and strategic progress for Rank. We are continuing to rebuild profitability following the impact of lockdowns and the material inflationary pressures experienced in recent years. Trading continues to improve due to ongoing investment in our people, our products and the facilities within our venues’ businesses, and the continued development of the proprietary technology which is driving the growth of our digital business. “With some important developments within our proprietary technology now in place, we are increasingly delivering a seamless and tailored cross-channel experience for our customers, leveraging our key area of competitive advantage.”
Rank Group had a tough time during the pandemic as its land venues in the UK and Spain were closed for long periods. The company reported a loss of £82.4 million in 2020-21 but returned to a group underlying profit of £40.4 million in 2021-22. In 2022-23, Rank saw a 5.9% increase in revenue, though higher impairment costs led to a statutory net loss.
As part of its strategy, Rank Group said that it was targeting the under-35s with special club nights and cheaper drinks. The strategy clearly worked, with visitor numbers growing 9% at Grosvenor Casinos and 2% at Mecca Bingo halls. Furthermore, 44% of the 187,000 new Mecca Bingo players were under 35 years old.
According to O’Reilly, people are attracted to a “great value night out in what is quite an expensive world”. He said that the customers are “much younger and more vibrant” than the stereotype of bingo players and added:
“We are increasingly making it more experiential. We have got hundreds of events up and down the country, typically on Fridays and Saturdays, where bingo is part of an evening that might include a garage music DJ, a comedian or a magician.”
There were 82 bingo halls before the pandemic and now there are 52; however, it seems that things are improving for the UK’s bingo players.
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