Fortified by a £128m (US$176m/€145m) Covid war chest, the UK’s Rank Group is confident that it can ride out the coronavirus storm – despite just posting an operating loss of £52.9m (US$72.6/€59.8m) for the first half (ending December 31, 2020) of its fiscal year.
Rank’s net gaming revenue in H1 totalled £156.9m (US$215.3m/€177.4m), down 58 per cent compared to the same period in 2019
This was mostly attributable to pandemic shutdowns of the group’s bricks-and-mortar verticals, principally the iconic Grosvenor and Mecca venues, and the strict adoption and enforcement of new safer betting protocols which capped wagers on digital platforms, said Chief Executive John O’Reilly.
After operating costs of £124.3m (US$170.6m/€140.6m) had been factored in, Rank’s HI operating loss hit £52.9m (US$72.6m/€59.8m), O’Reilly confirmed in a statement.
In 2019 the company posted an operating profit of £55m (US$75.5m/€62.2m) for the same period.
Every sector of the Grosvenor vertical—even digital—made a loss; totalling £22m (US$30.2m/€24.9m), compared to a £48.1m (US$66m/€54.4m) profit in H1, 2019.
Mecca Bingo lost £6.1m (US$8.4m/€6.9m) and international venues lost £600,000 (US$823,369/€678,390).
“There is no doubt that the impact of Covid-19 has been far beyond anything we, or any other leisure operator, could have imagined or planned for,” explained O’Reilly.
“The ever-changing restrictions, coupled with curfews, which in particular have [and have had] a seismic impact on our Grosvenor venues, have resulted in an exceptionally challenging first half for the Group.
“[But] I have remained incredibly impressed with our teams, who have displayed high levels of professionalism and adaptability under the continuously changing circumstances,” he said.
Although the ongoing pandemic continues to fuel business uncertainty, the Group’s strong money reserves—now totalling some £128m (US$176m/€145m), following an injection of £70m (US$96m/€79m) in cash in November—has given Rank the balance-sheet strength to survive extended lockdowns, O’Reilly asserted.