Rank warns of 'uncertain' impact of coronavirus on trading

Casino and bingo group Rank Group has warned of a slowdown in trading, and said it faced a potential multi-million pound hit after the UK government advised people to avoid leisure venues to combat the coronavirus.

Updating investors, Rank said in Tuesday that it had been trading in line with guidance since the start of the second half of the 2019/20 financial year.

However, it added: “In the last three weeks, we have seen a slowdown in trading across our UK venues, and in recent days we have inevitably witnessed a sharper declined. Despite the slowdown, our UK venues remained profitably last week.”

On Monday, the government advised people to avoid pubs, clubs and restaurants, causing panic across the hospitality and leisure industries.

Rank said: “Following the UK government guiding consumers to avoid leisure venues, our modelling shows that the impact of closures would result in a monthly net cash costs for the group of approximately £25m,” or around £17m after mitigation.

“In addition, the group has tax and duty payments of £40m falling due in April.”

The board added that, “given the continued uncertainty”, it did not believe it appropriate to provide financial guidance for the current financial year, ending 30 June.

The company has already had to close venues in Spain and Belgium, following movement restrictions put in place because of the coronavirus pandemic. However, Rank said it had received “substantial support” from the Spanish and Belgium governments to subsidise payrolls costs “as we temporarily lay off colleagues”.

As at 1430 GMT, shares in Rank were trading 2% lower at 107.20p.