Friday August 17, 2012 : INTERACTIVE DIVISION A STAR IN LATEST RANK PLC RESULTS
Online operations increased revenue by 20.8 percent, and operating profit by 26.5 percent.
The latest Rank plc results to end June 2012 show that the interactive division of the company has again made an important contribution to the overall performance of the UK land and online gambling group in its 75th year.
Rank Interactive increased revenue during the 12-month period by 20.8 percent to GBP 77.7 million, with a particularly strong performance from the Mecca brand driving a 26.5 percent rise in operating profit before exceptional items.
In Spain, Rank's enracha.es site is now licensed by the Spanish authorities, providing Spanish punters with online poker, roulette and community card games. Games on offer include traditional Spanish favourites, mus and chinchon, and management expects to launch bingo online from the third quarter of 2012/13. Online slot games have still to be brought within the licensing regime.
In Belgium, Rank has partnered with Unibet and awaits licensing by the Belgian Gaming Commission
Management notes that the increasing popularity of gaming via social networks represents both an opportunity and a challenge for Rank's brands. In response to customer demand, the Interactive division intends to make a number of ‘social games' available to play on Facebook during 2012/13.
Breaking Rank Interactive numbers out of the overall group results, the division upped revenues 20.8 percent to GBP 77.7 million, increased operating profit by 26.5 percent to GBP 10.5 million and drove EBITDA up 25.2 percent to GBP 15.4 million. Operating margins were up 0.6 percent to 13.5 percent.
Online bingo and casino operations were the top performers in Rank Interactive, up 24 percent to GBP 59.7 million for the former, with online casino improving a spectacular 49.1 percent to GBP 8.5 million. Sports betting languished, down 6.7 percent to GBP 8.4 million, whilst online poker plunged 26.7 percent to GBP 1.1 million.
Overall group results included:
* Revenues up 3.4 percent to GBP 600.5 million
* Group EBITDA at GBP 104.4 million – up 7.6 percent
* Pretax profit up 9 percent to GBP 61.5 million
* Net cash up 12.4 percent to GBP 41.8 million
* Players up 4.9 percent to 2,671,000, with the interactive division up 13.6 percent to 326,000 punters
* Average spend per visit unchanged at GBP 20.82, although up 1.6 percent in the interactive division to GBP 12.36
* Average revenue per customer up slightly at GBP 224.82
* Potential acquisition of Gala Coral group underway
* Adjusted earnings per share up 13.7 percent on 2010/11
* Final dividend of 2.50p recommended; total 12-month dividend up 35.3 percent on 2010/11
Rank chairman Ian Burke said:
"I am very pleased to announce that Rank has again achieved growth in earnings per share whilst strengthening our financial position and increasing the number of customers that we entertain.
"While the current economic conditions remain challenging we have continued to increase the popularity of our brands and we look forward to the future with optimism.
"Rank has grown revenue and operating profit during the period despite tough economic conditions and our financial position remains strong with net cash of GBP 41.8 million.
"On 10 November 2011, the European Court of Justice upheld the successive rulings of the UK courts that Rank had overpaid VAT on revenue from games of bingo for periods between 1973 and 2009. As a consequence of the ECJ decision, Rank will retain the GBP 253.4 million in refunded tax and associated interest paid by HM Revenue and Customs in prior periods. On 14 June 2012, the Upper Tier Tribunal heard HMRC's case concerning the outstanding amusements machine claim. We expect to receive a decision from the Upper Tier Tribunal later this year."