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Rank PLC reports 23% decline in half year profit

Despite a 10% rise in half-year 2010 revenues to £27.4 million, UK land and gambling group Rank plc reported a 23% decline in operating profit to £2.3 million this week. Management attributed the decline to marketing investment and product development, together with Italian and Spanish market start-up costs of £300,000.

Strong performers in the half year to end June were Mecca Bingo and the relaunched Gcasino brand, which continued to show encouraging growth.

Mecca Bingo recorded revenues up 20.7% to £19.8 million, thanks to bigger marketing investment that included a deal with Britain's Got Talent, a £700,000 television advertising campaign and improved cross-selling to customers from Mecca Bingo clubs.

Casino revenue rose 25% to £3 million, albeit from a low base, mainly as a result of cross-selling the online offering to customers of Rank's land-based G Casino and Grosvenor Casinos.

Blue Square sportsbook revenues declined 18% to £3.6 million despite the football World Cup during the latter half of June, reflecting a diversion of marketing spend to MeccaBingo and GCasino.com.

Poker operations again produced a lacklustre performance, with revenues down 41% to £1 million, again a consequence of marketing being diverted, although sector-wide declines in the genre were also a factor.

Source: InfoPowa News

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