Rank profits overshadowed by hikes

Mecca Bingo owner Rank reported a 40% increase in half-year profits but warned of tax hikes

Mecca Bingo owner Rank reported a 40% increase in half-year profits, but warned of a difficult second half after the Government's move to hike bingo and gaming duty.

The group reported underlying pre-tax profits of £24.7 million in the six months to June 30 as it benefited from strong performances at its Grosvenor Casinos arm and a stabilisation in trading at Mecca Bingo.

It said it put in a "creditable" first half performance and added that revenue growth had also accelerated since the start of the second half.

The first half only included two months of the new Government tax rates and the changes - including a hike in bingo duty from 15% to 22% - are expected to hit annual earnings by £9.4 million, Rank confirmed.

Shares in Rank rose 8% as the first half figures came in higher than most analysts expected.

The group said its Grosvenor Casino arm grew revenues by 1.5% on a like-for-like basis, with more members signing up - at 842,000, up 8.6% since the end of December.

The number of customer visits rose, but spend per visit was down 1.1% said Rank.

Its Mecca Bingo business - spanning 103 halls across Britain - saw better trading after "a couple of difficult years", according to the group.

The bingo operation last month recruited a new managing director, former Pizza Hut boss Mark Jones, as part of a managerial shake-up seen over the past 18 months to lead a revival of Mecca.

Gains in spend per visit helped offset ongoing falls in the number of bingo players, which is also hitting associated sales, such as food and drink.