Finance: Games Workshop Weathers The Brexit Storm
The grim darkness of the distant future might be the best bet to get you through Brexit, according to the latest financial news.
Since the Brexit vote in 2016, Games Workshop has proved to be one of the best bets to survive whatever economic fallout is coming, as Bloomberg reports, citing GW’s massive gain on the market–up nearly 1000% since June 23rd, 2016. This is by far the biggest margin, blowing second-place contender Ferrexpo Plc, an iron ore company, out of the water with only 737% gain in the same period. A big part of this is that Warhammer transcends nations–as the two analysts tasked with watching GW’s stock report:
The stock, which is covered by just two analysts, has benefited from Brexit-related currency moves. Games Workshop gets nearly two-thirds of its revenue from outside the U.K., so the pound’s weakness since the vote has made its miniature models cheaper for overseas customers. It has also created a positive currency translation effect in its financial results. Overall, revenue has more than doubled since its 2016 fiscal year.
Still, the currency impact isn’t the full story to explain the stratospheric rise of the shares in the past three years, as the pound has steadied in the past two. The retailer has embraced the Internet with the Warhammer Communityand is making efforts to attract a new generation of teenage players by setting up after-school Warhammer clubs, according to Peel Hunt analyst Charles Hall.
Citing recent moves by GW to “embrace online” with more options to engage with players, tweak rules, and engage with narratives, it seems that GW’s strategy of attracting new players to the community and giving them a place to play and connect with their IP is working. As for GW’s performance this year:
ares are up 62% this year, building on their three-year run, and also putting it in the top five FTSE 250 performers in 2019. And the popularity of its games may continue as it attracts more adult Warhammer fans who played the fantasy games as teenagers in the 1990s and early 2000s, according to Hall.
There you have it, folks. Warhammer continues to endure, and like a delicious, frosty milkshake, will bring everyone to the yard no matter which side of the pond you’re on. What do you think of GW’s performance? How would you change it? Have at it in the comments.
