- Full-year operating profit doubles
- Like-for-like net gaming revenue up
- Company returns to dividend list
Shares in Rank (RNK) gained more than 7% to 75p in morning trading as the casino and bingo operator said it would re-start dividend payments after underlying operating profit for the year to June reached £46.5 million, ahead of analysts’ forecasts and more than double prior year’s £20.1 million.
The company reported strong momentum across the group in the fourth quarter despite labour-cost pressures.
Highlights included Mecca Bingo moving from a loss of £5.6 million to an operating profit of £3.9 million.
A RETURN TO THE DIVIDEND LIST
The company recommended a final dividend of 0.85p per share for the 2023/24 financial year, showing renewed confidence from the board in trading and the group's financial position.
The firm also intends to declare a 2024/25 interim dividend alongside its half-year results next January.
Chief executive John O'Reilly commented: ‘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.’
EXPERT VIEW
Shore Capital analyst Greg Johnson was upbeat about Rank: ‘(The group's) key UK proprietary brands Grosvenor and Mecca were ahead by circa 20% as the ongoing investment in offering continues to improve performance, while Spain was up 16%.
‘We see digital well positioned to contribute meaningfully to group profitability going forward. The beat to forecast was from both digital and Mecca venues.
The group reported a net cash position of £21 million, comfortably above forecasts and up from £13 million last year, reflecting the higher profit base and a favourable working capital position as its revenue base builds.
‘With a step-up in capital spending next year, we see cash flow being broadly neutral in full-year 2025 with the group have the balance sheet and underlying cash flow to support proposed land-based gambling reform,’ added Johnson.
