Games Workshop 2023-2024 Annual Financial Report – Big Profits Confirmed
Games Workshop released their 2023-2024 Annual Financial Report and they revealed some BIG profits this year.
We had a good sign that GW as going to post some big profits from their pre-reporting about their financials this year. And yes, it turns out that they had a pre-tax profit of £203 million.
This continues the trend we saw with the Half-Year Financials. From the numbers it appears as if they managed to have a better second half of the year which is impressive considering how well they were doing previously.
Now, let’s see what they had to say about their successes this year.
via Games Workshop Investor Relations
Excerpts from the Chair:
Kevin Rountree, CEO of Games Workshop said:
“After a record year, we will continue to focus on the things in our control. We have a very clear strategy, which remains unchanged, a detailed operational plan for the year ahead and a great team to deliver it. I wish to thank our staff, customers, trade accounts and broader stakeholders for their ongoing support. Exciting times.”
You can read the full report from the PDF Here. Once again we’re going to keep this pretty high level. So let’s hit some of the highlights.
Games Workshop is committed to the continuous development of our intellectual property (‘IP’) and making the Warhammer hobby and our business ever better.
Our ambitions remain clear: to make the best fantasy miniatures in the world, to engage and inspire our customers, and to sell our products globally at a profit. We intend to do this forever. Our decisions are focused on long-term success, not short-term gains.
Yet again they reiterated on their strategy of focusing on long-term success. It appears to be working for them. Rountree continues to go into more detail about their strategy and key elements of how they want to continue business. From a business perspective it’s an interesting read. There is a focus on quality miniatures, using the IP they control, keeping customers engaged and retained, and cash flow.
On the review of this period, Roundtree had this to say:
Games Workshop and the Warhammer hobby are in great shape.
I am delighted to report the best results in Games Workshop’s history, so far. We have delivered sales, profits and dividend payments to shareholders at record levels.
We once again have designed, made and sold in record quantities, the best fantasy miniatures in the world – our Warhammer Studio has again been inspiring, thank you all.
Challenges Ahead
Roundtree also noted the balance between “too much stock or too little stock” and how that is a area they can improve on. It’s clear that GW doesn’t want to tie-up “too much cash” in stock but recognizes the problem of not having it on hand to actually sell.
We have purposefully, for our customers, increased stock levels year on year and the result is gross stock is higher. So, in the year ahead we will need to continue to be ambitious on our new release product performance and at the same time pragmatic when forecasting customer demand on our existing ranges.
Another pain point has been the IT system they have. Roundtree acknowledges this has caused some issues for them and the customers — “particularly in order processing.” At least they are aware of these issues and are taking steps to resolve them.
That said, there were a lot of positives in the Annual Report from Roundtree as well. There’s good notes on the company culture, climate change, their various Warhammer ranges (40k, A0S, HH, and Old World are all doing well), Warhammer-Community, and even Warhammer+ which currently has 176,000 subscribers (an increase vs last years 136,000).
Warhammer Licensing
The Licensing Business is going strong as well. As we mentioned earlier, GW is still in talks with Amazon and has until December 2024 to finalize the creative guidelines for any films/TV series they develop. It’s worth noting there’s an option to expand the rights beyond 40k and also include the Warhammer Fantasy universe, too.
On the video game front Roundtree called out the performance of two well received releases. “Particular launches of note were Rogue Trader and Warpforge.” He also mentioned other projects like Mechanicus 2, the digital version of Talisman 5th edition, and notes that Space Marine 2 is a highly anticipated release for the 2024/25 year.
Again, if you want to read the entire report you can do that here. Frankly, it’s a glowing report from the CEO of GW. Things are going well for them, they have a strategy that’s working (based on the numbers it’s hard to argue against that), and they are looking to maintain the long term growth. We’ll have to see if they can continue in the months and years ahead. But looking back at the previous year GW had a really good one in terms of their financials.
£203 million in Pre-tax profit is hard to argue against.
