Rank Group Sees Revenue Surge Amid Regulatory Challenges
Rank Group is gearing up for an ambitious financial year ahead after reporting noteworthy improvements in both revenue and net profit for FY25. The company experienced revenue growth across all sectors of its operations.
For the year ending on June 30, the group’s net gaming revenue reached a substantial £795.4 million ($1.08 billion), reflecting an 8% increase from the previous year and aligning with preliminary figures shared in July. Furthermore, the underlying like-for-like net gaming revenue climbed 11% to £795.3 million, excluding external factors such as new club openings and currency fluctuations.
The increment in revenue was observable across all four core divisions, and even though operating costs rose, the accelerated revenue allowed for an increase in both operating profit and net profit, with the latter seeing an impressive 272% growth.
Digital operations also contributed significantly, with total annual revenue reaching £235.7 million, a 10% increase, and average revenue per customer rising by 18%. In the UK, online revenue surged by 12% to £208.8 million, with Grosvenor and Mecca brands showcasing considerable gains of 22% and 11%, respectively. However, Rank’s other brands using the proprietary platform faced a 5% decline, although revitalization is expected in 2026.
Regulatory Landscape Affects Profitability
Despite these successes, Rank Group expressed concerns about the regulatory changes impacting its online segment. New UK regulations introduced in April 2025, which increased the statutory levy for problem gambling and set maximum stake limits for online slots, have already incurred costs of around £1 million in the last quarter of FY25. The group anticipates the annualized effect of these changes to be approximately £4 million moving forward.
Internationally, the digital performance in Spain was stagnant due to platform capacity issues limiting the provision of high-stake bingo rooms. While expansion plans in Portugal took longer than expected, Rank has made strides in obtaining platform certification, with a license expected soon.
On discussing overall online performance, CEO John O’Reilly stated: “Our online division is on track to reach an anticipated revenue growth of 8%-12%, leveraging our proprietary technology and creating a seamless experience for customers.”
Grosvenor Outpaces Competitors
Focusing on growth specifics, Rank’s Grosvenor business excelled, generating the highest revenue at £378.4 million and recording a 14% rise. Revenue from London venues alone was £117.5 million, with a notable 9% increase, while revenue from other UK locations increased by 17% to £260.9 million. Increased visitor numbers contributed to a rise in spending per visit by 11% year-on-year.
Rank attributed this growth to focused investments in its venues, enhanced product offerings, and strategic improvements in customer management. These developments signify a positive outlook as new land-based casino reforms come into play.
Similarly, the Mecca bingo segment saw a 5% revenue increase to £140.3 million, driven mainly by enhanced gaming machine revenues. The introduction of new terminals from Light & Wonder has helped propel this segment forward.
Expectations for Future Expansion
O’Reilly commended the results, noting that revenue and profit exceeded expectations, with both online and physical businesses benefiting from enhanced customer experiences. As 2026 kicks off, Rank anticipates legislative reforms intended to modernize the land-based gambling landscape.
The reforms include provisions to expand gaming machine numbers and facilitate self-service betting terminals, which Rank is positioning itself to utilize. O’Reilly emphasized the potential for significant growth stemming from these changes, stating, “The Grosvenor business is primed to benefit from increased gaming machine allocations and sports betting options, catering to a wider customer base.”
Record Net Profit and Caution Over Taxation
The financial year concluded with a net profit of £44.6 million, a staggering 248% rise. Despite rising operating expenses, the revenue growth compensated, leading to a 128% improvement in operating profit.
During the earnings call, O’Reilly highlighted concerns regarding potential increases in gambling taxes proposed by the Treasury. These changes could significantly impact the profitability of gaming businesses, possibly leading to reduced competition and adverse effects on consumers.
He pointed out that Rank already pays substantial taxes, amounting to about £189 million in FY25, representing approximately £4 for every £5 generated. O’Reilly stressed the importance of careful consideration regarding tax adjustments: “Any increase in tax could jeopardize profitability and drive businesses away, ultimately harming consumer choices.”
In conclusion, Rank Group remains optimistic as it navigates regulatory challenges while capitalizing on profitable growth opportunities across its various sectors, setting the stage for the future.