Annual profits drop for Rank

Profits after tax fell from £27.6 million a year before to £9.4m with net gaming revenue down 15 per cent from £685.1m to £585.1m.

The group, which has Mecca sites across the Black Country and in Telford and a casino at Walsall, includes was seeing strong results before the Covid-19 pandemic following the introduction of a new transformation strategy and a tightly controlled cost base.

It says that actions to address coronavirus have positioned Rank well for recovery and it is preparing for the next phase of the group's transformation with new three-year plans being developed for each business unit aimed at driving revenue growth and delivering further cost and ways of working efficiencies.

Significant progress has been made on the embedding of safer gambling across the group including being the first bingo operator to add safer gambling controls for time and spend to its gaming machines.

Chief executive John O'Reilly said: "With positive momentum from the transformation programme, Rank performed very strongly during the first part of the year and into the second half. Despite continued good growth in our digital brands, with our venues closed from mid-March, the impact of the Covid-19 pandemic on the group has been significant. However, with the huge commitment and dedication of our colleagues, very tight cost control across the business and the support we have received from Government, we have carefully navigated the past few months and are now beginning to successfully emerge.

"We know the recovery will take time, but the underlying strength of our business provides us with confidence that we are well equipped to return to full strength.

"We've been encouraged by the first few weeks of trading following reopening and whilst the supply-side constraints, including social distancing and changes to the way we operate table gaming, are going to be challenging over the coming months, the response from customers to the extensive safety measures we have in place has been very positive."

Mecca venues have been reopening over the course of July and August with 72 of 77 now open and typically achieving 70 per cent of the previous year's revenue and visitor numbers at 55 per cent.

Grosvenor's casinos in England were only being permitted to reopen from August 15 and those outside of London are typically achieving 75 per cent of last year's revenue levels. Trading in London venues is weak, with revenue at around 40 pe cent.

Rank expects to rebuild revenues through the year with an increase in footfall expected once social distancing and other supply constraints reduce and customer confidence returns.

In light of the Covid-19 pandemic and the material impact to the business the board will not be proposing a final year dividend. The full year dividend will be 2.8p per share reflecting the interim dividend paid on March 13.