Rank expects £4m annual impact from new UK regulations

Rank Group has set its sights on further growth during the upcoming financial year after posting a rise across both revenue and net profit in FY25. All areas of the business reported an increase.

Reported net gaming revenue for the 12 months to 30 June hit £795.4 million ($1.08 billion), the group revealed. This cleared the previous year by 8% and was in line with preliminary figures published in July.

Underlying like-for-like net gaming revenue also climbed 11% to £795.3 million. This figure removes the impact of new club openings, closures, foreign exchange movements and discontinued operations.

Revenue growth was apparent across all four core segments of the group. While these rises were accompanied by higher costs, revenue grew at such a rate that both operating and net profit increased year-on-year, with the latter up 272%.

Rank saw further uplift within its digital business. Total revenue for the year was £235.7 million, up 10%, while average revenue per customer jumped 18%.

In the UK, online revenue grew 12% to £208.8m, with double-digit rises across Grosvenor (22%) and Mecca (11%). Rank’s other brands operating on the proprietary technology platform declined 5% but are expected to return to growth in 2026.

UK regulation impact reaches £1 million in Q4 of Rank’s FY

Rank, however, acknowledged the impact of changing regulation on its online business. The statutory levy for research prevention and treatment of problem gambling was introduced from April 2025 in the UK, with this rising from the existing voluntary rate of 0.1% to 1.1%. A maximum staking limit for online slots play of £5, and £2 for consumers aged under 25, was also implemented in April 2025.

“The impact on digital profitability in the final quarter of the year (April to June 2025) has been around £1 million,” Rank said. “We therefore expect the annualised impact to be in the region of £4 million going forwards.”

Away from the UK, digital performance in Spain was flat. The group said it was hampered by platform capacity constraints which started in its Q2. This restricted its ability to deliver regular big prize bingo rooms to YoBingo customers.

Meanwhile, plans to launch in Portugal have taken longer than expected. However, Rank has secured platform certification from the country’s regulator, with a licence due to follow in the coming weeks.

Commenting on the online segment as a whole, O’Reilly said: “Our online business is tracking to the expected 8%-12% revenue growth rate as we drive the benefits of our proprietary technology and develop seamless cross-channel experiences for customers.”

Grosvenor leads the way with double-digit growth

Taking a closer look at growth patterns in 2025, Rank’s Grosvenor venues business led the way. Not only did it generate the most revenue at £378.4 million but it also saw the highest percentage of growth, reporting a 14% rise.

Some £117.5 million came from London venues, up 9%, while rest of UK revenue increased 17% to £260.9 million. Rank noted a 3% increase in visitor numbers, while spend per visit was also 11% higher than the previous year.

“Revenue growth is the result of the significant and targeted investments that we have made in our venues, an improved product offering, improvements to customer risk management and our people and culture,” Rank said. “They are an encouraging prelude to the growth that we anticipate as a result of the land-based casino reforms.”

The UK-facing Mecca bingo venues business also recorded revenue increase, with this rising 5% to £140.3 million. Visitor numbers were flat year-on-year but Rank noted a 5% rise in spend per visit among players.

Mainstage bingo remained the primary driver of visits, although Rank said the installation of new terminals from Light & Wonder helped push gaming machine revenue at the venues up 9%. Again, it said the recent reforms will likely increase machine revenue further in 2026.

“Gaming machine revenues were up 9% and now account for 41% of Mecca’s net gaming revenue,” Rank said. “There is plenty of scope for further growth, particularly with Gambling Act reforms still to come.”

Rank’s other venues business, Spanish-facing Enracha, posted a 9% increase in like-for-like revenue to £40.9 million. These venues, which feature bingo, sports betting and gaming machines, reported a 3% rise in visitors and 6% jump in spend per visit.

“The strongest performance came from those venues which recently enjoyed targeted investment,” Rank said. “In H1, we completed the refurbishment of our Seville venue, which saw 4% growth in visits and 14% growth in revenue over the course of the year.”

UK legislative reform to drive more growth

CEO John O’Reilly welcomed the results. He said revenue growth and profit were both ahead of expectations, while increases within both its online and land-based businesses were the result of investments to improve customer experience.

“We are growing profitability and have a strong net cash position,” he said. “This will enable both continued investment and progressive dividend returns for our shareholders.”

O’Reilly also cast an eye towards Rank’s 2026 financial year, which commenced in July. This coincided with the UK Parliament passing long-awaited reforms aimed at modernising the land-based gambling industry.

Among the land-based casino reforms were measures to increase the number of gaming machines within a venue. Another change enables converted casinos (not regulated by the 2005 Gambling Act) to offer betting via self-service betting terminals (SSBTs). 

Rank has wasted little time in taking advantage of the reforms. Work is ongoing to install more terminals across its UK estate. The group is also seeking to introduce sports betting at its venues for the first time.

All this, O’Reilly said, will likely lead to more growth in 2026. He commented: “With the long-awaited legislative reforms for casinos now delivered, the group is at an exciting inflection point.

“The Grosvenor business will benefit from the higher gaming machine allocations and the introduction of sports betting, which will better meet existing customer needs and increase the attractiveness of casinos to a broader base of consumers. Our bingo businesses continue to strengthen as we invest in the quality and value of the customer offering.

“We have a very strong road map of opportunity to build further success for the Rank Group over the coming years.”

Net profit tops £44.6 million in FY25

Looking to spending, both cost of sales and operating expenses were higher year-on-year at Rank. However, the revenue increase offset these rises, allowing operating profit to improve by 128% to £60 million.

After net financing charges, pre-tax profit hit £53.9 million, up 248%. Rank paid £9.3 million in tax, meaning it ended the year with a net profit of £44.6 million, some 248% more than last year.

“I would like to recognise the exceptional work of my colleagues across the group whose unwavering commitment to delivering outstanding customer service continues to be the cornerstone of our financial performance,” O’Reilly said.

‘Businesses will go’ if UK tax rate increases, says O’Reilly

During the Thursday earnings call, O’Reilly urged the government to tread carefully over the potential gambling tax changes proposed in the UK.

The Treasury has proposed replacing the current three-rate system for remote gambling with a single remote gambling tax. If approved, this would be called the Remote Betting & Gaming Duty.

The Institute for Public Policy Research has also called for an increase in tax. It suggested raising remote gaming duty from 21% to 50%, as well as significantly increasing other retail tax rates.

O’Reilly told analysts Rank already pays high taxes in the market – approximately £189 million in total in FY25 – which equates to around £4 of every £5 it generates.

“I don’t moan about the tax we pay as this is the type of business we are in,” he said. “But the margins for tax are not significant. Any increase has the potential to move a business from being profitable to not profitable. As such, businesses will go and competition in the market will decrease, which is not good for the consumer. I think the Treasury understands this.

“We have put our thoughts to Treasury. My preference is to not have online tax tied into a single tax. The higher the tax rate, the harder it is to compete with the bigger players and that’s bad news for the consumer.”