Woes continue for gambling group
Gambling company Rank has scrapped its final dividend payment as the woes continue for the bingo, casino and online betting company.
The overall performance of its bingo chain, Mecca bingo, was poor. Like-for-like revenues in the 14 weeks since September 1 were down by 18 per cent, admissions were down 15 per cent and spend per head was down 3 per cent.
Its land-based casino arm, Grosvenor Casinos, did not fair much better with like-for-like revenues down by 7 per cent, admissions down 5 per cent and spend per head down 2 per cent.
The only bright light in a somewhat bleak future (at least in the short term) was the performance of Blue Square. The online betting website reported like-for-like revenues climb by 34 per cent in the 49 weeks to December 9. Rank’s Spanish bingo operation, Top Rank Espana, also faired well with like-for-like revenues rising by 8 per cent over the same period.
The disappointing bingo performance was put down to the “level of uncertainty facing the gaming industry and the more general market concerns of a consumer spending slowdown as we move into 2008” as well as the crippling smoking ban that was introduced in the summer.
There are even worries that Rank could breach its borrowing agreements with banks. Rank admitted that they expect to stay within those agreements so long as trading did not deteriorate any further.
With Ranks share price taking a battering over the past few months, the company has become a potential takeover target. The US casino company Harrah’s is reported to have had an offer rejected by Rank which would have effectively seen Harrah’s swapping its UK casinos for a 28 per cent stake in the company.
Malaysian gambling company Genting also recently upped their stake in the company to ten per cent.
Editor, Jackpot.co.uk - 2007-12-12 11:55:03