The gaming giant Gala Coral has released 2009 accounts even though it previously suggested it would not be releasing them due to its extensive restructuring program. The group showed a loss of £496 million for the period ending 26th September 2009. Turnover was pretty static, however restructuring costs and write-downs in relation to bingo turned a £228m operating profit into massive losses. The company benefitted from a £46m VAT refund in relation to Bingo operations.

Group operating profit 2009: £228.1 million (2008: £248.1 million)

Bingo operating profit (before administrative expenses) 2009: £57.7 million (2008: £65.2 million)

Although admissions and income per customer were both down there were some positive points in the period: “In a difficult economic climate which has hit our core customers hard, the division saw a drop in admissions over the year and also a fall in spend per head achieved over the period. Despite the drop in overall spend per head, profitability per head remained resilient and improved year on year.

Following an extensive productivity and efficiency drive in 2008 management retained a strong focus in 2009 and delivered significant cost savings in payroll and property costs.”

The bingo operations also trimmed costs with the closure of 9 bingo clubs in the period bringing the total number down to 147.

The online bingo operations faced their own unique problems: Galabingo.com showed an improvement in amounts staked in the year, although the overall margin achieved was down by 0.1% on the prior year as a result of product mix. The online bingo space remains intensely competitive and the division invested heavily in marketing in the year to maintain a market leading position, achieving record unique active customer numbers within the year.

The company reported exceptional items in the year of £378.4 million of which £288.9 million was attributed to write-down of Bingo goodwill. The company reported costs associated with restructuring of £71.8 million primarily referring to “vacant lease provisions” and “restructuring and streamlining”. In June and July 2009 the group received a refund from HMRC in relation to the ruling on Mechanised Cash Bingo of £66.1 million and a further £6.4 million in interest. The group has reported a £46.6 million benefit (net of duty and irrecoverable VAT). The company also showed a £5.1 million result in relation to the disposal of property.

In relation to the companies ongoing viability the company stated: “Following the groups restructuring on 21st June 2010, the directors have reviewed the group’s cash flow forecast and trading budgets and after making appropriate enquiries, have formed the view that the group is operationally and financially robust and will generate sufficient cash to meets its ongoing requirements for at least the next 12 months.”

Interestingly it is of no surprise that the company has spent the last 12 months restructuring its debts. As of the end of September 2009 the group had Net Current (liabilities) assets, which is the total money in the bank and money owed minus money that is had to payout over the next 12 months of -£61.2 million.