Shares in Rank Group (Xetra: A0LGPG – news) climbed 3% to 130p after the bingo, casino and online gaming operator announced a 35% increase in dividends. Rank, which is majority owned by Guoco Group, which itself is a subsidiary of Malaysia’s Hong Leong Group, said adjusted pre-tax profits rose 9% to £62m on revenues that improved 3% to £600m.
Rank, which is valued at £490m, said: “While the current economic conditions remain challenging we have continued to increase the popularity of our brands and we look forward to the future with optimism.”
Those brands include Mecca Bingo, which posted flat revenues, and Grosvenor Casinos that saw a 4% improvement in sales. However, a double-digit drop in revenues at the company’s Top Rank España, highlights the problems facing the Spanish economy.
The company said: “Tough trading conditions in Spain resulted in Top Rank España’s revenue declining by 12.8% to £29.2m. Operating profit before exceptional items was also down 65.0% to £1.4m.”
However, Rank’s Spanish business only accounts for around 7% of turnover and 5% of profits. Consequently, its exposure to Europe (Chicago Options: ^REURUSD – news) ‘s woes is unlikely to have any significant impact.
In fact, the company said: “Rank has grown revenue and operating profit during the period despite tough economic conditions”
It added: “Rank’s annualised dividend per share has grown at a compound rate of 31.2% since 2009.”
David neither owns shares in The Rank Group nor plays bingo.