In a recent update detailing Rank Group's financial results for FY2025/26, CEO Richard Harris addressed a series of challenges facing the UK retail casino sector. His comments are reportedly in response to a recent Social Market Foundation report advocating for increased taxation on higher-risk Category B electronic gaming machines. Harris emphasized that anti-gambling campaigners are obscuring the positive contributions of the regulated gambling industry, stating they have “cast clouds” over it.
This year, the sector has seen a significant rise in remote gaming duty, jumping from 21% to 40%. Additionally, new Prime Minister Andy Burnham has proposed giving councils enhanced powers to limit Adult Gaming Centers. Harris depicted betting shops negatively, likening them to proliferating vape shops on UK high streets.
He argued that these increases in taxation could harm the sustainability of brick-and-mortar gambling establishments. “Tax proposals from anti-gambling campaigners continue to cast clouds over a regulated industry that is proud to support jobs across the country, deliver great hospitality experiences to millions of customers, and Rank paid over £225 million in taxes and duties last year,” he commented. Harris warned that higher taxes would jeopardize the viability of businesses like bingo halls and casinos, which already operate on narrow margins. He highlighted that previous governmental support for bingo clubs could be undone by such tax increases.
On the financial side, between June 2025 and June 2026, Rank Group reported a 5% growth in net gaming revenue (NGR), reaching £835 million ($1.13 billion), largely driven by a strong performance in its digital segment. Underlying EBITDA rose 15% year-over-year to £138.3 million, while underlying operating profit increased by 21% to £78.6 million. Despite these growth figures, reported operating profit fell by 7% to £55.7 million, as the impact of various tax increases led to a 23% decline in profit after taxes to £29.9 million.
In terms of comparable figures, the group’s underlying like-for-like NGR was up 6% to £834.1 million, and underlying like-for-like operating profit saw a 20% climb from £66.7 million to £79.9 million. The year ended with net free cash flow totaling £25.5 million, a decrease from £27.7 million the previous year, although net debt improved from £154.7 million to £147.2 million.
The digital segment displayed particularly strong performance, with underlying like-for-like NGR climbing 8% to £248.5 million, surpassing that of physical venues. In the fourth quarter, digital revenues surged by 12%, a trend Harris described as “particularly encouraging” for the company’s profitability.
In the retail sector, average weekly NGR at Rank’s Grosvenor casinos increased by 5% year-on-year to £7.6 million, with both customer visits and spending per visit rising. This growth was attributed to the rollout of 850 machines across 37 casinos, even as table gaming performance was affected by ongoing conflicts in the Middle East. Meanwhile, the NGR from Rank’s Mecca venues grew 4% on a like-for-like basis, despite the closure of nine venues deemed commercially unviable.
Rank noted a “strong trading momentum” in the first six weeks of its new fiscal year, with group NGR rising by 8%. The digital segment again led the way, reporting a revenue increase of 10%, and Grosvenor gaming machine revenues grew by 15%. Looking to the future, Rank reaffirmed its ambition to achieve over £100 million in underlying operating profit in the medium term, despite anticipating a decline in digital profitability in FY’26/27 due to the doubling of remote gaming duty.
Rank emphasized that maintaining the current rate on machine games duty, set at 20%, is vital for operational viability, warning that any increase could adversely affect both Grosvenor and Mecca venues and lead to reduced tax revenues within a year.
On the personnel front, in July, Rank appointed Richard Harris as its new permanent CEO. Harris had served as interim CEO following John O’Reilly’s departure in January after nearly ten years in the role. Rank also announced in July that Karen Whitworth would step down from the board, and subsequent to the upcoming AGM on October 8, Lucinda Charles-Jones will follow suit. Non-executive director Katie McAlister will temporarily take over as the chair of Rank’s remuneration committee after the AGM, and the company plans to appoint a new senior independent director to replace Whitworth in due course.
