Profit gains at Carlton despite trading headwinds

Carlton, bingo, Profit, business, finance
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Scottish bingo operator Carlton slimmed down administrative costs to see a 5 per cent gain in earnings last year – countering a dip in overall takings which has been prevalent throughout the UK bingo sector.

The latest financial results from Scottish bingo chain Carlton Bingo detail a rise in gaming machine income and overall operational cashflow.
Carlton operates 14 bingo destinations predominantly in Scotland but also northern England.
Its most recent figures, which detail performance for the company through to March 25 last year, actually show a slight dip (of 2.4 per cent) in annual takings to £32.4m.But due to what company directors claim to have been a“significant reduction” in administration expenses, pre-tax profit grew by nearly 6 per cent – to £2.1m.
A statement from management attributed revenue losses to wider economic factors,but said there were encouraging take-aways pertaining to customer engagement.
“While the underlying results for the group reflect the continued cost of living stresses being felt by our customers, inflationary pressures and increased competition for leisure time, a drop in customer visit frequency has been more than offset by increased spends at gross and net spend per head level,”said directors.
“Importantly,gross customer spend per head on main session bingo, interval bingo, gaming machines and bar and catering operations rose.As a result,and aided by controlling costs generally, the group has produced an improvement in operational cashflow to last year.”
As to the forward-looking picture,Carlton’s board said it remained“optimistic”as to the efficacy of the company’s improvements in both customer service and marketing tools – inclusive of a new scheme of promotions target- ing lapsed members.The company also said it took heart in the relaunch of the National Bingo Game,a movie which it claimed had“broad industry support.”
Bingo operators have had to absorb a number of increases in operating costs in recent years,with the introduction of the national living wage and the requirement to cater for the latest £1 coin both driving up capital expenditure.
Carlton has by no means been exempt from these inflationary cost factors, noting both as mitigating earning factors which drove costs in excess of £1m throughout the 2016/17 trading year, and nearly £900,000 in its most recent annualised accounts. Nevertheless,its management has claimed that with these one-time events now in the past, capital expenditure will return to a“normalised”state as of its 2018/2019 posting.

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