Rank's Revenue Rises as It Closes Three Casinos and Warns of More Under UK Tax Plans

Rank Group reported a 5% rise in first-quarter net gaming revenue to £216.1 million for the quarter ended 30 September. In the same update, it said it had closed three Grosvenor casinos in Swansea, Reading Central and Sunderland because they were no longer economically viable over the medium term. Growth and closures are being reported side by side.

The Grosvenor numbers point to a portfolio decision rather than a collapse in demand. Like-for-like revenue there rose 6%, with gaming machines up 14%. Visits rose only 1%, so most of the gain came from a 5% increase in spend per head. Analysis: the surviving estate is earning more from each visitor, and the three closures look like a choice to exit weaker sites. Rank has not, in the material available, said how many jobs those three venues employed.

Chief executive Richard Harris linked any increase to Machine Games Duty in the upcoming Budget to higher costs, venue closures, job losses, lower tax receipts and halted investment. The Budget has not yet been announced in the material, so a duty rise is a prospect under discussion, not a decision. Entain's chief executive, Stella David, made a similar case last month. Both are operators arguing their own position, so their warnings are an argument to weigh, not independent evidence of the outcome.

The decision sits with HM Treasury. Harris says the Treasury recognised the economic arguments last year. What remains open is the rate, whether it applies to machines in the way operators fear, and how many venues would close. The neglected question is who would bear a duty rise. If it falls hardest on marginal sites, the pattern Rank has already shown with its closures may be the first effect, and the strongest venues may be least affected.

Rank also reached a £5 million settlement with the Gambling Commission earlier this month over anti-money laundering and social responsibility failures at three land-based casinos, according to the Casino.org report. That sits awkwardly beside an argument that the sector is a partner in growth, and it shows that compliance costs are part of the venue economics the Budget debate will test.