Rank Group executives take 20% pay cut in coronavirus mitigation plan
UK casino operator defers £40m HMRC tax bill and expects to save £8m a month on staff furloughs in UK, Spain and Belgium
Rank Group’s executive and non-executive directors have taken a 20% pay cut from 1 April for the duration of the coronavirus lockdown.
The London-listed operator has furloughed more than 90% of its 7,600 strong UK workforce due to closures in its venues business, having placed all furloughed employees on the government’s coronavirus job retention scheme (CJRS).
Rank revealed the furloughing of its employees in the UK, Spain and Belgium is expected to save £8m a month, with a further £1m saved via the UK government’s business rates holiday scheme.
Rank has also deferred a £40m tax payment to HMRC from 30 April to 30 June.
“Whilst we have limited forward visibility and with it the likely pace of recovery, we are preparing for difficult trading conditions when we reopen our venues businesses,” the operator told investors.
“The short-term economic impact to our venues businesses has been significant, but we have acted swiftly and decisively to mitigate where appropriate.”
Rank requested the payment of £25.2m from HMRC in VAT claims from the government over the firm’s land-based slots business in April following a long-running legal dispute.
Rank won its case against HMRC with a UK tribunal court ruling in favour of the operator earlier this month. However, HMRC is currently seeking permission to launch an appeal against the ruling.
In addition to the financial action, Rank Group has introduced several responsible gambling measures including the ceasing of all social media advertising throughout the Covid-19 lockdown period.
Rank has unveiled “elevated levels of control” for its digital customers including lower deposit level triggers for safer gambling interactions and heavily promoting deposit limits to its customers.
Rank today reported a 21% year-on-year rise in digital revenue from its online business during Q3 2019/2020.
Net gaming revenue (NGR) from its Grosvenor Digital business grew by 27% during the quarter to 31 March 2020, an increase the business attributed to continued growth in new players and strong levels of returning players.
Mecca Digital’s NGR also increased 20% during Q3 2019/2020.
NGR for Rank’s international Yo brand rose by 9% year-on-year due to the impact of management and operational changes made in the business during Q2, according to the operator.