GW financials latest

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**reds8n**

.. gonna do this here rather than news/rumours

PRESS ANNOUNCEMENT

GAMES WORKSHOP GROUP PLC
("Games Workshop" or "Group")

8 June 2015

TRADING UPDATE ON CLOSE OF FINANCIAL YEAR ENDED 31 MAY 2015

Following the close of its 2014/15 financial year Games Workshop provides the following trading highlights:

We expect the Group's profit for the year to 31 May 2015 to be broadly in line with market expectations.

Over the year we have seen modest sales growth, at constant currency, in our core trade and mail order channels. We saw a small decline in our own stores due to continued difficult trading in Continental Europe following our restructuring last year. We saw expected declines in some non-core activities that are grouped with core activities in our reporting. The effect of these non-core activities and the continuing effects of unfavourable exchange rates mean that our reported sales are likely to show small declines in retail (c.5%) and trade (c.3%). Mail order growth was c.5%.

We will provide full and detailed information, including the effects of adverse exchange rates, at the time of our results announcement on 28 July 2015.

http://www.londonstockexchange.com/exchange/prices-and-markets/stocks/summary/company-summary/GB0003718474GBGBXSSMM.html?lang=en

**Kilkrazy**

"Modest sales growth in ... mail order channels" is of course because of an increasing number of products that are direct order only.

We will have to wait for the full report, but this statement does not give any confidence that the overall figures are going to look good.

**xraytango**

I always love it when they say "in line with market expectations".

Yeah, if the market expects lower sales volumes and increasing prices.

I wonder what these "modest sales growths" are. Perhaps it is only them saying that they saw sales growth where it hadn't been before because there were other sales channels that were selling those products.

Notice they didn't say a "modest sales growth overall". They are making qualified statements for some reason.

I wonder if we will see an overall down trend as we have these last couple of years.

There should be a good reason why their sales have declined in an industry that has seen an aggregate 45% growth over the last three years ( appx 14%-16% each year)

Of course we see that they should be the industry leader yet <strikes deceased equine> they are not.

One day all otiose things shall be gone and they won't have to worry about it.

A "decline in our own stores", da crap does that even mean? Declining sales in their stores or a reduction in the number of stores?

I could see it as fewer sales in their stores due to NOTHING is being done to actually promote their stores!

**Herzlos**

I think they mean declining sales from their stores.

We saw expected declines in some non-core activities that are grouped with core activities in our reporting

Does that sound like they are going to use that to hide decline in core activities to anyone else? Why not split it out otherwise?

show small declines in retail (c.5%) and trade (c.3%). Mail order growth was c.5%.

Since it's roughly a 33/33/33% breakdown between retail/trade/store, so the store->web thing makes sense (if you're paying retail you may as well pre-order it) and cancels each other out. 3% trade drop is more worrying, less people are buying from FLGS.

Going by the number of traders dropping/reducing GW I'm surprised it's not lower.

I guess all we can tell from this is that they haven't made any miraculous recovery yet and are looking at another decrease in revenue/profits.

**Bottle**

I was hoping it would be good news for them. Maybe the new AdMech were relased too late in the year to make an impact. I hope with the AdMech and Age of Sigmar though they'll see a sales growth in Q1 and Q2 of this new financial year.

**jonolikespie**

That feels like a lot of big, meaningless, contradictory words designed to not actually lie, but definitely not give a truthful indication of the state of anything.

**Mr. Burning**

Revenue down £10m on this time last year.

Profit is also around £10m down on the same time frame.

I would like to see the full report when it comes out in July just to see what they consider non core vs core. and what the actual percentages mean.

**reds8n**

... Suspect the "non -core yet core" might cover the Hobbit/LOTR stream .. ?

**Howard A Treesong**

It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.

**Herzlos**

reds8n wrote:
... Suspect the "non -core yet core" might cover the Hobbit/LOTR stream .. ?

I'm sure it'll cover the magazine as well, the paint ranges and probably the WHW work. But since it's rolled in there's probably no way we'll find out.

**Deadnight**

It's all about the exchange rates.

**Howard A Treesong**

Deadnight wrote:
It's all about the exchange rates.

Is that their excuse for Australia?

**Deadnight**

Howard A Treesong wrote:
Deadnight wrote:
It's all about the exchange rates.

Is that their excuse for Australia?

Australia? Who cares.

That's their excuse.

**Kosake**

Deadnight wrote:
It's all about the exchange rates.

Yeah, it's the exchange rates! And the restructuring we did 10 years ago... and... and... did we mention the exchange rates? And the financial crisis? Yeah, that's why we are in decline, but it's only temporal!

Sounds like a lot of whitewashing financial gibberish in the text and a slow, painfull decline in the numbers.

**jonolikespie**

Howard A Treesong wrote:
It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.

2 years ago?

**Herzlos**

jonolikespie wrote:
Howard A Treesong wrote:
It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.

2 years ago?

They mentioned some ongoing cost for the restructuring, so it was spread over a few years and they could still be paying that (leases on EU offices for instance).

Then there's amortized costs for the webstore, and the HQ overhaul. Lots of one-time-expenses to explain away the drop in sales.

**notprop**

jonolikespie wrote:
Howard A Treesong wrote:
It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.

2 years ago?

I think it refers to the reshuffling of the European HQ's (branches) back to the UK plus consolidating stores away from hi rent areas, which is still going on here in my part of the world.

**reds8n**

Indeed.

All those new "warhammer" store fronts, logos, uniforms etc etc

**Azreal13**

Herzlos wrote:
jonolikespie wrote:
Howard A Treesong wrote:
It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.

2 years ago?

They mentioned some ongoing cost for the restructuring, so it was spread over a few years and they could still be paying that (leases on EU offices for instance).

Then there's amortized costs for the webstore, and the HQ overhaul. Lots of one-time-expenses to explain away the drop in sales.

They can use those to explain a drop in profit, but there's little they can do to explain the drop in revenue other than the already well trodden "our staff are rubbish, do you have any idea how hard it is to recruit decent people when you offer poor conditions and few benefits?" excuse they've offered before.

**TheAuldGrump**

Mr. Burning wrote:
Revenue down £10m on this time last year.

Profit is also around £10m down on the same time frame.

I would like to see the full report when it comes out in July just to see what they consider non core vs core. and what the actual percentages mean.

Don't worry, I am sure that they will still trumpet 'Woohoo! Dividends!' and get rid of some more of that revenue....

The Auld Grump

**Tyron**

PRESS ANNOUNCEMENT

GAMES WORKSHOP GROUP PLC
("Games Workshop" or "Group")

We saw expected declines in some non-core activities that are grouped with core activities in our reporting.

I wonder what they could be?

Herzlos wrote:
3% trade drop is more worrying, less people are buying from FLGS.

Could this be attributed from people leaving the hhhoby and selling their stuff on here/ebay/in person?

**Sinful Hero**

Tyron wrote:
PRESS ANNOUNCEMENT

GAMES WORKSHOP GROUP PLC
("Games Workshop" or "Group")

We saw expected declines in some non-core activities that are grouped with core activities in our reporting.

I wonder what they could be?

An excuse for a fall or no change in Core sales.

**Korinov**

Bottle wrote:
I was hoping it would be good news for them. Maybe the new AdMech were relased too late in the year to make an impact. I hope with the AdMech and Age of Sigmar though they'll see a sales growth in Q1 and Q2 of this new financial year.

Keep dreaming lol.

The press announcement doesn't say much. I'd expect the report to continue the trend of slow decline in both sales and profits.

**Tannhauser42**

Howard A Treesong wrote:
It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.

It'll get old when the interns overseeing the GW part of the portfolio at the big investment firms pass the report on up to drop GW's shares.

**Herzlos**

Tyron wrote:
Herzlos wrote:
3% trade drop is more worrying, less people are buying from FLGS.

Could this be attributed from people leaving the hhhoby and selling their stuff on here/ebay/in person?

I think it's more likely because FLGS's can't stock as much stuff and other games are more tempting. GW's sales through 3rd parties are continuing to drop as more 3rd parties give up on GW. As the other companies are growing GW is getting less shelf space in more indies, with some dropping them entirely.

So it's definitely down to people leaving the HHHhobby, but I don't think much to do with the 2nd hand trade.

**Rayvon**

Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.

**PhantomViper**

Rayvon wrote:
Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.

What climate is that? The climate where miniature wargame sales have been growing by double digits for more than 3 years in a row?

**Mr. Burning**

Herzlos wrote:
Tyron wrote:
Herzlos wrote:
3% trade drop is more worrying, less people are buying from FLGS.

Could this be attributed from people leaving the hhhoby and selling their stuff on here/ebay/in person?

I think it's more likely because FLGS's can't stock as much stuff and other games are more tempting. GW's sales through 3rd parties are continuing to drop as more 3rd parties give up on GW. As the other companies are growing GW is getting less shelf space in more indies, with some dropping them entirely.

So it's definitely down to people leaving the HHHhobby, but I don't think much to do with the 2nd hand trade.

A lot of product is now Direct only even some formerly core product. New releases aside (and I'm not sure how many of those are available for Independents) there must be some issues with making up an order focusing on an ever narrowing product line.

**Azreal13**

Rayvon wrote:
Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.

You're going to have to qualify that a lot.

Especially as you seem to be making some fairly fundamental assumptions based on no actual figures. Remember, last year, "broadly in line with management expectations" equated to double digit drops in revenue and profit.

**Herzlos**

Rayvon wrote:
Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.

How do you explain the growth of, well, everyone else in the gaming industry (including Warlord/Perry/Mantic/Renedra who are all local to Nottingham)?