In an update concerning the fiscal year 2025/26 results released on Thursday, Rank Group CEO Richard Harris addressed the challenges facing the UK’s retail casino sector. He took a critical stance on recent developments that threaten to affect this industry.
Touching on a report from the Social Market Foundation, which advocates for increased duties on certain electronic gaming machines categorized as 'higher-risk Category B,' Harris lamented that anti-gambling activists have created a negative atmosphere for the UK’s regulated gambling market.
This year has seen the sector grapple with a steep rise in remote gaming duty, escalating from 21% to 40%. Additionally, new Prime Minister Andy Burnham has moved to empower councils with greater authority to limit the operations of Adult Gaming Centers.
Harris described betting shops as questionable establishments, likening them to the increasing number of vape shops cropping up on UK high streets.
He warned that the proposed tax hikes could backfire, jeopardizing the sustainability of physical gambling businesses. "Tax proposals from anti-gambling campaigners continue to cast clouds over a regulated industry that is proud to support jobs across the country, delivering outstanding hospitality experiences to millions of customers. Rank paid over £225 million in taxes and duties last year," he stated.
"Tax increases for clubs like ours, which operate under strict supervision and on tight margins, will swiftly result in lower tax receipts as beloved bingo halls and casinos may be forced to shut down, affecting customers in local communities. The government has shown support for bingo clubs like ours in recent years, and any tax increase would significantly impact commercial viability," he added.
Rank Group has reported a 5% growth in net gaming revenue (NGR) for the period between June 2025 and June 2026, totaling £835 million ($1.13 billion), primarily driven by a strong showing from its digital segment. The company's underlying EBITDA jumped 15% year-on-year to £138.3 million, while the underlying operating profit surged by 21%, reaching £78.6 million.
Despite these gains, reported operating profit fell by 7%, from £60.1 million to £55.7 million. The operator faced a 23% decline in profit after tax, which dropped to £29.9 million due to various tax increases.
The group provided figures on a like-for-like basis, excluding effects from venue changes, foreign exchange fluctuations, discontinued operations, and new markets not fully operational for over a year. The underlying like-for-like NGR increased by 6% to £834.1 million, and underlying like-for-like operating profit rose by 20%, moving from £66.7 million to £79.9 million.
Closing the year, Rank recorded a net free cash flow of £25.5 million, a decrease from £27.7 million the prior year, although net debt improved, sliding from £154.7 million to £147.2 million.
The digital segment demonstrated particularly strong performance, with an 8% rise in underlying like-for-like NGR reaching £248.5 million, surpassing that of its land-based venues. For the fourth quarter, digital like-for-like revenue jumped by 12%, with Rank considering this growth as particularly encouraging and essential for delivering solid profits for the year.
In the retail segment, the average weekly NGR from Rank’s Grosvenor casinos increased by 5% year-on-year to £7.6 million, with higher customer visits and spending per visit also reported. This growth was partly attributed to the installation of 850 machines across 37 casinos during the year, though performance in table gaming suffered due to conflicts in the Middle East.
Rank's Mecca venues also noted a 4% rise in NGR on a like-for-like basis, despite closing nine non-viable venues during the year. The company pointed out a promising trading momentum observed in the first six weeks of the new financial year, with group NGR up by 8%. Digital revenues led this trend, rising by 10%, while Grosvenor gaming machine revenue climbed 15%.
Looking forward, Rank reaffirmed its goal to achieve over £100 million in underlying operating profit in the medium term, although it acknowledged that digital profitability would likely decline in FY 2026/27 due to the nearly doubled remote gaming duty.
In terms of land-based operations, Rank emphasized that retaining the current rate of machines games duty is crucial. "Set currently at 20%, any hike in this rate will further threaten venue viability across both Grosvenor and Mecca, and could reduce tax receipts within a year," the company warned.
Regarding personnel changes, in July, Rank appointed Richard Harris as the permanent CEO, a position he held on an interim basis before taking over from John O’Reilly, who stepped down in January after nearly a decade. The company also announced that Karen Whitworth would resign from the board, and Lucinda Charles-Jones is set to follow suit following the AGM on October 8. Non-executive director Katie McAlister will temporarily step into the role of remuneration committee chair after the AGM. The company intends to find Whitworth's successor as a new senior independent director in the near future.
