Rank Group has published the financial results for the quarter ended March 31, 2022, highlighting that they reached 156.4 million pounds sterling (188.2 million euros), a significant increase considering that for the same period the previous year the revenue was £48.7 million. However, considering the trends seen, as well as continuing inflationary costs, they now expect earnings to shrink.
Below, we share the highlights of the report published by Rank Group:
The UK locations (Grosvenor and Mecca) were closed for the entire third quarter of 2020/21. The Enracha offices in Spain were open during part of the third quarter of the previous year, but with very severe capacity restrictions.
The most recent comparable non-COVID-19 affected third quarter period is therefore the three months to 31 March 2019. Against that comparative period, Grosvenor venues NGR was down 14% and Mecca venues down 25%. For both our UK venues businesses there was a softness in visits at the end of the quarter consistent with the rise in new COVID-19 cases reported across the UK.
The performance of Enracha venues continued to recover, with NGR falling just 2% compared to the same quarter in 2018/19.
In this regard, the group considers that, although the recovery is taking time, that in the medium term there is still a firm path towards recovery to the levels prior to the COVID-19 pandemic.
When it comes to digital business, the group confirms that the UK digital NGR was down 1% year on year. Grosvenor digital grew NGR by 3%, as it continues to benefit from omni-channel players from our Grosvenor venues.
On the other hand, Mecca digital NGR fell 11% due to the anticipated impact of its migration to the RIDE platform in January.
The performance of the remaining digital brands continued to be mixed, with 42% growth in other brands operating on the RIDE platform partially offset by a 25% revenue decline in non-proprietary brands following the introduction of affordability restrictions in the first semester 2021/22 by other operators.
International digital was down 5%.
Looking ahead, Rank Group explains that it is entering a traditionally low seasonal period at its Grosvenor locations with a reduced number of visits. They anticipate an improvement in performance after April, but it remains to be seen how trends in the rate of return of office workers to city centers and foreign clients to London towards the summer will play out.
Thus, considering third quarter trends, in particular weakness in their UK locations towards the end of the quarter and ongoing inflationary costs, they have updated the previously guided EBIT range of £55-65 million (66-78 million euros approximately) for the year ending June 30, 2022 at a range of £47 million. -55 million pounds sterling (56-66 million euros approximately)
To conclude, John O'Reilly, CEO of Rank, said: “The performance of our venues softened in March, and this has continued into the first few weeks of Q4, impacting our current expectations for our full year performance. We recognize the pressures on UK consumers but are confident that the improvements we are continuing to make to the customer proposition and the investments in our venues, alongside the gradually reducing impact of the pandemic and, with it, the return of overseas customers, position us well for the year ahead”.
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