Edison Investment Research - Rank Group PLC (RNK) UK gaming sector: Regulator delivers a harsh verdict

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Edison Investment Research

Victoria Pease

UK gaming sector: Regulator delivers a harsh verdict

After many months of procrastination, the UK government has finally delivered a verdict on the fixed odds betting terminals (FOBTs), reducing stake limits from Â£100 to Â£2. Although not entirely a surprise, this is a disappointing result for the industry and will likely entail more than 3,500 shop closures. Also, while a decision has been made, there is still much uncertainty regarding timing and implementation. For online operators, there is a further blow, in the form of potential increases in gaming taxes at the next budget. This confirms recent speculation and is now widely expected to increase from 15% to 20%.

17/05/2018 2 EN

Underlying

Rank Group PLC

Rank Group is a gaming operator. Co. has four segments: Grosvenor Casinos, which is a casino operator that provides a range of casino table games, including roulette, blackjack, baccarat and poker as well as electric casino and slot machine games; Mecca, which is a bingo operator that provides a selection of games from bingo to a range of slot games, and the venues also have food and drinks, and live entertainment; Luda, which is a community-based gaming brand; and Enracha, which is Co.'s community-based gaming business for the Spanish market that provides community games like bingo as well as electronic casino and slot machine games, sports betting, food and drink and live entertainment.

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GB00B1L5QH97 London Stock Exchange United Kingdom

Provider

Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts

Victoria Pease

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UK gaming sector: Regulator delivers a harsh verdict

Rank Group: 1 director

Rank Group - Recovery potential and operational gearing

RANK GROUP sees an upgrade to Slightly Positive due to a better fundamental star rating

International Public Partnerships - Consistently and responsibly delivering

Portobello SpA - Focus back on the operations

Intralot - Focus on business development in FY24

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