Rank Group’s digital division the belle of its H1 ball
UK-listed gambling operator Rank Group’s digital division reported a 56% rise in operating profit despite new taxes on customer bonus offers.
On Thursday, Rank released its fiscal H1 report, which saw like-for-like revenue (before customer incentives) essentially flat at £378m in the six months ending December 31, 2017.
H1 earnings (pre-exceptional items) improved 6% to £63.3m and operating profit gained 14% to £41.7m. Meanwhile, statutory results showed pre-tax profits falling 7% to £32.8m, thanks mainly to nearly £6m in impairment charges from two Grosvenor Casinos in Dundee and Didsbury.
However you wish to slice it, Rank’s UK digital operations were the belle of its ball, reporting revenue rising 16% to £60.6m and operating profit up 56% to £11.4m. Rank CEO Henry Birch hailed the “particularly strong” digital results, especially following the recent application of gaming duties on customer bonuses.
Rank’s Meccabingo.com site reported H1 revenue rising nearly 10% year-on-year to £36.1m, while Grosvenorcasinos.com shot up 27% to £24.5m thanks to its strong slots and live casino offer, the latter getting a boost from new live casino apps and the launch of ‘dual play’ live streaming.
Rank hopes to extend its digital hot streak by launching a new television marketing campaign in fiscal H2. Rank launched live-streamed roulette from the Grosvenor Victoria casino in H1 and plans to add a live baccarat stream in H2.
H2 will also bring the launch of two new digital brands (Bella Casino and Luda), redesigned Mecca and Grosvenor websites and an improved sports betting product courtesy of Kambi Sports Solutions.
Rank is also intent on making multi-channel activity its major focus in 2018, part of its three-year plan to boost the number of Grosvenor retail customers playing digitally from its current 3.5% to 15%. Rank launched a new Grosvenor employee affiliate scheme in H1 to help steer digital migration, which Rank says helped push digital first-time depositors up 40% in its fiscal Q2.
In Spain, Rank’s Enracha division soft-launched its digital operations last September on a Bede Gaming platform, and while the Spanish-facing site is currently limited in scope, the company says initial feedback has been good for both the brand and its multi-channel offer.
On the retail side of things, Grosvenor Casinos revenue slipped 2.3% to £197.2m while operating profit improved 15% to £30m. The casinos reported reduced visitation and a lower than normal win margin, particularly at its London venues, which was partially offset by a strong performance at provincial venues.
Mecca venues revenue slipped 3.7% to £104m and profit fell 4.5% to £12.7m. Fewer customers visited Mecca venues in H1 but those who did reported higher spend per visit.
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