Inverness-based Carlton Clubs has stepped up its annual spending by more than £100,000 since the government halved taxes on bingo halls.
In the wake of the cut the company increased its capital expenditure to £813,000 in the 12 months to to the end of March and budgeted for a further rise this financial year, according to its annual accounts.
The financial results, released by Companies House this week, show Carlton’s pre-tax profits rose by more than £753,000 to £2.1million, compared to the previous year. Turnover at the company, which runs 13 venues, including clubs in Inverness, Buckie, Elgin and Fraserburgh, and operates online, was also up by nearly £690,000 to £15.1million.
Taxes on bingo halls were reduced from 20% to 10% in then Chancellor George Osborne’s 2014 Budget.
Mr Osborne said the cut was prompted by the fact that the number of halls had “plummeted by three-quarters over the last 30 years.”
In the forward to its accounts Carlton reported the frequency of visits by customers to its clubs had been maintained and their spending had increased.
The report said: “While the underlying results for the company reflect the continued cost of living stresses being felt by our customers and increased competition for leisure time, customer visit frequency has been maintained and spends have increased at net spend per head level.”
It also reported that “importantly” gross customer spend per head (net of taxes) on main session bingo, interval bingo and gaming machines rose.
As a result and aided by “controlling costs generally,” the company said it had produced a “significant improvement in operational cashflow to last year.”
During the year Carlton’s average number of employees was 320, which was virtually unchanged from last year’s figure.
The company said the introduction of the national living wage had “inevitably resulted in an increase in operating costs,” but it had been able to mitigate these during 2015/16 and believed it can continue to do so.
Looking ahead, the company said: “A continued focus on customer service and marketing with varied (measured) offers and targeted new member promotions provides optimism for the future.”