BOMBSHELL!!! Games Workshop Half-Yearly Financials Out

Quite the financial day for Games Workshop.  One year after the departure of CEO Mark Wells we have the latest half-yearly financial report.  Guess how GW has been doing in the last 6 months…

Games Workshop Investor Relations

Key Excerpts:

Revenue          £60.5m (2013)    £67.5m (2012)
Pre-tax profit  £7.7m (2013)     £11.1m  (2012)

INTERIM MANAGEMENT REPORT 
First half performance 
Sales in the first half of the year were down against the comparable period in the prior year, continuing the trend that developed in the second half of 2012/13. During the first half, the rapid transition from multi-man stores to one-man stores and the reduction of trading hours across the Group caused disruption in our retail chain. We also experienced some decline in sales through independent stockists. 

We view these as short-term issues and expect to see growth return in bothchannels. We continue with our store opening programme (27 stores opened, 20 closed in the period) secure in the knowledge that our one man model allows us to ensure new openings are profitable. In the future we expect to benefit from the more focussed selling operation across all channels against the background of a materially lower cost base. 

Changes to operating structure 
We have just announced a major re-organisation of our sales businesses to allow management by channel: retail, trade and direct. Our retail businesses will be consolidated under a single Retail Sales Manager for each of our key geographic areas – UK, Europe and North America. Trade sales will be consolidated into a global business, operating from Lenton, Nottingham. 

Prospects 
Our costs are well under control and margins remain strong. Cash management is good and our capital expenditure continues as planned. The principal risks and uncertainties for the rest of the financial year relate to sales and the implementation of the structural changes we have just announced. Whilst profit will remain under pressure during the implementation of the structural changes mentioned above, the board remains confident in the future growth and profitability of the Group. 

Going concern 
After making appropriate enquiries, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. For this reason they have adopted the going concern basis in preparing this condensed consolidated interim financial information.

Here’s the graph of Games Workshop’s share price today (down 24% as of time of publication).

~Talk among yourselves about GW’s performance and the road ahead. More conversation in the Lounge here.

Author: Larry Vela

Dad, Gamer, Publisher, Pilot, Texan. All games all the time since junior-high. I started BoLS Interactive in 2006. I’m a lifelong tabletop & RPG gaming enthusiast, and internet publisher working to entertain and inform my readers every day. I've been playing RPGs and Tabletop Games since the 1970s. I'm been playing and covering Warhammer and Warhammer 40K for over 35 years.