Just three days before the expected completion of the Hard Rock sale for US$965 million, The Rank Group Plc today reported its preliminary results for the year ended 31 December 2006. Operating profit for Hard Rock, reported as a discontinued operation, was £40.4 million (US$78.9 million) compared to £34.8 million (US$67.9 million) in 2005. Revenue from continuing operations was £549.6 million (US$1.07 billion), up from £529.8 million (US$1.03 billion) the previous year.

Ian Burke, chief executive of The Rank Group Plc said: "Through the actions that we have taken in 2006 we have repositioned the Group to focus purely on mainstream gaming. This is a market where we have a depth of operating experience, a portfolio of strategically important assets and recognised brands and where we see opportunities for sustained long-term growth." Rank has taken steps to re-energise its gaming division.

Mecca Bingo profits were down last year - £72.1 million (US$140.7 million) from £87.9 million (US$171.5 million) in 2005. Initiatives to improve competitive positioning have resulted in recent gains in market share. The smoking ban, which has already adversely affected business in Scotland, will be effective across the whole of Britain from July.

Casino operating profit rose from £35 million (US$68.3 million) in 2005 to £39.5 million (US$77.1 million). However it is the Interactive division that has seen the most growth, principally as a result of strong revenue growth from online gaming. Blue Square operating profit reached £7.8 million (US$15.2 million) last year from just £1 million in 2005. Grosvenor Casinos has seen a strong rise in active membership. Ian Burke commented, "As a result of our programme of restructuring, we have transformed Rank into a focused gaming business.”

Corporate functions and Gaming shared services have now been merged, with a £6 million annual saving in overheads from 2007. New club operating models and purchasing efficiencies have been introduced for an estimated £10 million annual cost savings from 2007 in Mecca Bingo and Grosvenor Casinos. Ian Burke said: "During 2006 we agreed or completed asset disposals totalling more than £1.1 billion, including the sales of Deluxe Film, Hard Rock and US Holidays. By the time that the £350m special dividend is paid on 9 April 2007, we will have returned £550m to shareholders in the space of 14 months (excluding ordinary dividends).”

In summing up the Chief Executive stated, "We see long-term growth prospects in the UK gaming market and we believe that, with our integrated model of bingo, casino and betting with both retail and on-line distribution, we are well placed to benefit from the predicted increases in consumer spending on mainstream gaming.” He added, "In the short-term we recognise that our businesses face a number of challenges, most notably the smoking ban which will be effective across the whole of Britain from July this year. Our strategy is to take vigorous action to meet these challenges while retaining our long-term focus on the growth opportunities for Rank." (E-03.02.07)

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