The Rank Group, which owns the UK-wide chain of Mecca Bingo clubs and G (Grosvenor) Casinos, has warned that the effects of the Coronavirus outbreak are likely to hit its profits further as the weeks and months go by.
The company’s statement comes after the UK government recently recommended that members of the public should avoid large social gatherings at venues such as cinemas, restaurants, bars, and theatres as part of its measures to curb the spread of the potentially life-threatening Coronavirus. In particular, those over the age of 70 have been told that they should stay away from bingo halls for their own safety.
The Rank Group now forecasts that it will suffer multi-million-pound losses as footfall in its bingo clubs and casinos continues to fall.
Although the company told its investors that it had been trading in line with guidance since the beginning of the second half of the current financial year, it states that it’s seen a “slowdown in trading across its UK venues” over the last three weeks.
Rank describes the “sharper decline” as “inevitable” but maintains that its UK venues managed to stay profitable last week. It also forecasts that if it’s forced to close its land-based establishments that it stands to lose around £25m. It also has an upcoming tax and duty bill of £40m which is due to be paid this April.
The Rank Group has already been forced to shut its venues in Belgium and Spain as part of the countries’ current movement restrictions. However, it says that both governments have aided the company with “substantial support” that has allowed it to subsidise payroll costs.
Other gambling businesses have also revealed that their earnings have been significantly impacted due to the suspension of major sporting events such as horse racing, football, and rugby. The parent companies of Ladbrokes Coral, Paddy Power, and Betfair have forecast that the knock-on effects will reduce their profits by over £100m each.