Grosvenor Casino Profit Warning

• Grosvenor Casino Profit Warning 2019
• Grosvenor Casino Profit Warning Signs
• Grosvenor Casino Profit Warning Template
• Grosvenor Casino Profit Warning Report

Rank shares tumble 15% to three-year low after profits warning This article is more than 2 years old. The situation was worse at its Grosvenor Casino chain, with where sales down 9% as weaker. Annual profits for the Rank Group, which includes Mecca Bingo and Grosvenor Casinos, dropped by 66 per cent in the year to the end of June.

One of his luckiest sessions came one December, when Green took a trip to a Mayfair casino. A few hours later, Green had pocketed a mind-boggling £2 million – an amount large enough to trigger a profit warning at the casino.

Mecca Bingo's revenue fell by 2%, Grosvenor's venues revenues fell by 9%, although digital revenue grew by 17%. As a result, the firm's management now expects full year operating profit to be in the range of £76 million to £78 million, below analysts' consensus of £83 million. Rank’s profits warning was blamed on a drop in attendance at its bingo halls and casinos after the smoking ban. The sector is also facing a tougher regulatory environment.

The UK's two most prominent operators of five-a-side football pitches are examining a surprise merger that would create a major international leisure player.

Sky News has learnt that stock market-listed Goals Soccer Centres and privately owned Powerleague have been discussing a combination of the two businesses.

It was unclear on Saturday what stage any discussions were at and what the likelihood of an eventual deal was.

A tie-up between Goals and Powerleague, which between them operate roughly 100 sites, would significantly increase their UK presence, as well as bringing under one corporate umbrella their venues in Ireland, the Netherlands and the US.

It was also unclear this weekend whether their substantial combined presence in the UK would trigger any competition issues, or how these might be addressed.

Goals, which was loss-making in 2015, returned to profit last year, and appointed Mark Jones, a former Grosvenor Casinos executive, as its new boss.

It also raised nearly £17m from investors to pay down debt.

The company has a market capitalisation of just under £77m.

Powerleague trades from more than 750 football pitches, and also owns Powerplay, a league operator across 240 UK venues.

In addition to football, it has a multi-sport offering including basketball, dodgeball and netball.

The company was bought by Patron Capital Partners, which focuses on buying businesses with substantial real estate assets, in 2009 in a deal which put an enterprise value on Powerleague of about £80m.

Previously listed on the London stock market, Powerleague has been expected to be put up for sale by Patron for some time.

The structure of a deal between Goals and Powerleague has yet to be finalised, according to insiders.

A bingo boss has launched a scathing attack on 'illogical' rules that have forced sites to close in some Covid hotspots – but not others.

John O'Reilly, whose company Rank Group owns 77 Mecca bingo halls and 51 Grosvenor casinos, said it was 'impossible' to plan ahead when venues are shut 'on a whim'.

The 60-year-old pointed out that while bingo was closed in Blackpool in Lancashire, it remains open across Merseyside, even though both regions are under the toughest coronavirus curbs.

'It makes zero sense,' said O'Reilly, a former Ladbrokes executive who has been in charge of FTSE 250 member Rank since 2018.

'I can open my bingo halls in Liverpool. But I have to shut my bingo hall in Blackpool. We have been clumsily and inadvertently caught up in misdirected measures that do nothing to suppress the virus, but which have put thousands of jobs and livelihoods at risk.'

Warning that closures and curfews 'are putting the entire sector at risk' as well as wasting taxpayers' money, O'Reilly raised the alarm over the wellbeing of his staff, many of whom now face a bleak winter without work.

'The impact on colleagues is immense,' he told the Mail. 'They are bereft frankly. We're left in the bizarre situation where we're contributing to the Treasury in Southport by generating revenues but relying on Treasury support in Blackpool by virtue of being shut down.'

Rank is preparing to close more sites in Greater Manchester and South Yorkshire after the regions became the latest to be placed under Tier Three rules.

While the Merseyside bingo halls have been allowed to stay open, Rank will close four more Mecca sites in Greater Manchester tomorrow, in Oldham, Rochdale, Sale and Bolton.

It is still awaiting clarity as to whether three Mecca sites in South Yorkshire – in Sheffield, Doncaster and Rotherham – can stay open.

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At the Grosvenor business, Rank has already closed its casino in Blackpool and in Liverpool as well as two in Glasgow and one in Edinburgh.

A further six Grosvenor casinos will close across Greater Manchester at 10pm tonight – including two in the city centre and four more in Salford, Stockport, Didsbury and Bolton.

Cardiff and Swansea will shut tomorrow and Sheffield will likely close its doors on Saturday. Rank's remaining casinos are still open, but subject to the 10pm curfew, which O'Reilly says is hammering the business.

Unlike in pubs and restaurants, more than half of revenues at Grosvenor casinos come after 10pm. O'Reilly has unsuccessfully offered to shut the bars in order to stay open.

'Bars and pubs are aggrieved about curfew,' said O'Reilly. 'They've lost a little bit of their day's trade. But in a casino, it's savage. The curfew is having a crippling impact on our business with no public health benefit that I can see.'

He went on: 'It seems wholly illogical that in Blackpool I can go to the door of the Grosvenor casino, which is on one side of the seafront and it's shut, and I can turn and cross the road and walk into a public house serving steak and kidney pies and pints of lager and it's heaving with people.

'Shutting businesses down on what appears to be a bit of a whim just is another example of how all of this ceases to make much sense.'

The Rank share price doubled in value in 2019 and the business was still 'flying' in February. But its sites were shut on March 20 as the pandemic swept the country and 90 per cent of its staff – or around 7,000 workers – were furloughed.

As lockdown took its toll, profits for the 12 months to the end of June fell 66 per cent to £9.4million and revenues slipped 8 per cent to £638million. And the workforce has shrunk from 7,700 to just under 7,200.

Rank invested heavily in making its sites as safe as possible – including £2million on screens in its casinos. Every chip is cleaned after a customer touches it, and cards are 'single use' or only touched by one dealer before being thrown away.

Getting Mecca bingo clubs ready to resume business was rather easier. 'In Mecca, we have got vast venues, they are enormous,' said O'Reilly. 'I joke that our customers in Mecca have been social distancing for years.'

But with rules around the country tightening, many workers face a winter relying on taxpayer support rather than an income from work.

Grosvenor Casino Profit Warning 2019

O'Reilly yesterday wrote to Sadiq Khan, Mayor of London – where Rank has eight casinos and six bingo clubs – to get the 10pm curfew lifted and boost business.

Grosvenor Casino Profit Warning Signs

'Our understanding of the curfew is that it was implemented to reduce the incidence of mainly young-adult drinking late into the evening and spreading the virus through failing to maintain appropriate social distancing,' O'Reilly said in the letter.

Grosvenor Casino Profit Warning Template

'The average age of our casino customers is 48 and the average age of our bingo customers is 57.

The average spend on food and drink, per person, per visit, in one of our casinos is £4.20. In our bingo clubs it is £2.40. It is simply not the case that our venues are places where people come to drink.'

Grosvenor Casino Profit Warning Report

Despite this, the shutters are coming down once again.