Rank Group PLC (LSE:RNK) welcomed more people through the door at its UK venues but punters were spending less as the cost-of-living crisis and affordability restrictions weighed on sentiment.
Grosvenor Casino venues saw customer visits grow 5% in the six months to 31 December 2022 when compared to the prior year but spend per visit declined by 9%.
The gambling group blamed this on “affordability restrictions and the cost-of-living crisis.”
It was a similar story at Mecca Bingo locations, where visitor volumes rose by 4% but like-for-like net gaming revenue was down 20% when compared to the first half of 19/20.
“Since lockdown we have faced a huge increase in energy costs, high wage inflation, the slow return of overseas visitors to London and the increasing pressure on consumer's discretionary income,” said chief executive John O’Reilly.
“We have also experienced a continued tightening of the regulatory environment, particularly in regards to affordability restrictions on customers.”
Tougher affordability restrictions were put forward by a Government white paper last year, which suggested punters should be checked after incurring a certain loss over a period of time (i.e. £125 in a month).
The triggers to start the checks vary between different gambling operators, including casinos and bookmakers.
Despite a strong Christmas, it still expects the macro-environment to impact spending at its UK venues.
“We experienced strong trading over the Christmas and New Year holiday period but recognise that the trading environment is likely to be challenging in the months ahead and cost pressures will continue to weigh heavily on the UK hospitality sector,” said O’Reilly.
In the six months to 31 December 2022, the group's venue net gaming revenue slipped 1% on the same period a year prior, with Grosvenor revenues down 5%.
The underlying group operating profit for the first half was £4.2mln compared with £24.9mln for the same period last year.