Rank is worth substantially more than 150p per share ... - Rank Group

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Financial Strength to Create Value … Materially Improved Financial Position • Since 2007, Rank’s financial position has strengthened materially. This improvement has been driven by substantial cash flow generation within Rank’s businesses and the receipt of proceeds from VAT claims. • As a result, Rank now has a positive cash position. Net Debt (£m) Change in Net Debt (£m) 316.9 316.9 226.5 186.8 123.4 114.1 (236.6) FY 07 FY 08 FY 09 FY 10 (39.4) PF FY 10 1 FY 07 Operating Cash flows Capital Expenditure (233.8) (39.4) Legacy inc. VAT Refunds PF FY 10 1 Strength to Invest and to Grow • The improvement in Rank’s financial position has allowed significant capital investment to extend the reach and broaden the appeal of Rank’s brands and, as a result, create future growth options. • Rank’s current position provides continued flexibility to invest for future growth. 28.2 Capital Investment (£m) 34.3 51.6 50-55 • £114m of capital investment over last three years —— Focus on extending the reach and broadening the appeal of Mecca and Grosvenor • Future investment to take advantage of attractive opportunities —— —— G Casino roll-out Mobile / online FY08A FY09A FY10A FY11E Mecca Grosvenor Rank Interactive TRE Other Strong Cash Flow Generation and Financial Flexibility 14 1 Rank’s net debt as at 31 December 2010 is stated proforma for receipt of £162.8m of VAT proceeds.
… And Drive Shareholder Returns Returns to Shareholders Through a Progressive Dividend Policy • Rank reinstated its dividend in 2009, paying 1.35p per share. • In 2010, Rank increased its dividend to 2.40p per share, representing an increase of 78% on 2009. Total Dividends Declared (£m) Dividend per Share (p) Dividend Cover 1 (x) +78% 9.4 +78% 2.40p 6.6x 5.3 1.35p 4.3x FY 08 FY 09 FY 10 FY 08 FY 09 FY 10 FY 08 FY 09 FY 10 • In future, Rank intends to grow its dividend in order to align it more closely to underlying group performance and target a dividend cover level of 3.0x over the near term. Delivering the Capital Structure Policy Over Short to Medium Term • In 2010, Rank announced a capital structure policy with a target net debt/EBITDA of around 2.5x. • Since the announcement of this policy, Rank’s leverage levels have been below this target reflecting a prudent approach until final resolution of its current VAT cases. • Once further clarity has been received on the VAT proceeds in late 2011, Rank will seek to move towards its capital structure policy over the short to medium term through considering: —— —— —— Continued capital investment in Rank’s businesses; Growing returns to shareholders; and Potential acquisitions where strategically and financially attractive. Rank is committed to: • Maintaining a strong financial position • Investing in its brands to drive growth • Providing shareholders with growing returns • Delivering its capital structure policy target with leverage of around 2.5x net debt/EBITDA Commitment to Growing Shareholder Returns 1 Dividend cover based on adjusted EPS. 15
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Page 3 and 4: RANK IS WORTH SUBSTANTIALLY MORE TH
Page 5 and 6: We believe that these opportunities
Page 7 and 8: Good Positions in Attractive Market
Page 9 and 10: Driving Value Creation … Has Deli
Page 11 and 12: 3 Capital Investment to Extend Reac
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Page 19 and 20: Entertaining People Entertaining fo
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Page 25 and 26: Additional Information 1. Responsib
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Page 33 and 34: “Offer” “Offer Document”
Page 35 and 36: Keep your shares in Rank For furthe

Rank is worth substantially more than 150p per share ... - Rank Group

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