Rank Group PLC (LSE:RNK) shares racked up an 8.4% gain to 98p in early Wednesday trading after the casino and bingo operator upgraded its full-year profit outlook.
The group said like-for-like net gaming revenue rose 5% to £205.4 million in its third quarter to 31 March, with year-to-date revenue up 6% to £625.2 million.
Growth was recorded across all divisions: Grosvenor Casinos, the largest unit, saw revenue increase 5% to £95.0 million; digital revenue rose 4% to £60.9 million; Mecca bingo venues grew 5%; and sales at Spanish business Enracha were up 9%.
Rank said strong conversion of revenue into profit means full-year underlying like-for-like operating profit is now expected to be at least £68 million.
The company has taken steps to offset the impact of higher UK remote gaming duty, including cutting marketing spend and supplier costs, while protecting customer incentives.
Interim chief executive Richard Harris said: "The results demonstrate the resilience of the business, the strength of the customer proposition and the growth initiatives we have in place."
Rank expects further revenue growth in the fourth quarter, with energy costs not expected to have a material impact on results.
Harris, chief financial officer since 2022, was given the temporary CEO role in January after former boss John O'Reilly stepped down, triggering a formal search process to identify a permanent CEO.
House broker Shore Capital said the new guidance is circa £3 million above its prior estimates and so "highly encouraging, especially given the broader backdrop".
The second half, compared to last year, could be "broadly flat", analysts said, as they estimate around a £7 million regulatory headwind in the final quarter.
The broker now forecasts operating profit of £68.6 million and earnings per share of 9.6p for the current year, and continues to assume "modest progress" in the next, estimating profits of £68.9 million as underlying revenue growth offsets a full 12-month impact from the step-change in RGD.