Games Workshop Group PLC announces that the Board yesterday declared a dividend of 18 pence per share. This will be paid on 9 January 2013 for shareholders on the register at 30 November 2012.

Ah the Kirby gravy train keeps on'a rollin choo choo! kinda hard to think that they couldnt use the money for RnD to improve certain products or infrastructure before paying dividends

NO COMPANY MUST EVER MAKE PROFIT

Yeah 'cause that's what cypher was saying.

Good. Glad to see that they're still going strong.

A dividend doesn't mean they're 'going strong'. All it means is that they paid a dividend. They've borrowed money in the past to do that.

 H.B.M.C. wrote:
A dividend doesn't mean they're 'going strong'. All it means is that they paid a dividend. They've borrowed money in the past to do that.

They have? This is not something I'd heard of happening. Seems like a great way to collapse into debt. Oh well, so much for optimism.

Graphite wrote:
NO COMPANY MUST EVER MAKE PROFIT

No company should trade short term gain against long term viability.

but really, a one line sarcastic reply like that surely isn't your rebuttal to my statement? when did we descend to soundbites and quips to put a point across. come on sir. join the debate in full rather than fishing for an argument.

 cyphertheory wrote:

Graphite wrote:
NO COMPANY MUST EVER MAKE PROFIT

No company should trade short term gain against long term viability.

but really, a one line sarcastic reply like that surely isn't your rebuttal to my statement? when did we descend to soundbites and quips to put a point across. come on sir. join the debate in full rather than fishing for an argument.

Welcome to the internet.

Do you see... what I did there?

Anyway, you make a good point. It's easy to lay blame at the feet of the shareholders, publicly owned companies often suffer as a result of things like that, but that's kind of an easy answer, I feel, and one that's overly informed by opinion for my part. So I'll not stop there. Rather, I'll play devil's advocate, and ask why you think they're sacrificing long term viability?

 htj wrote:

 H.B.M.C. wrote:
A dividend doesn't mean they're 'going strong'. All it means is that they paid a dividend. They've borrowed money in the past to do that.

They have? This is not something I'd heard of happening. Seems like a great way to collapse into debt. Oh well, so much for optimism.

Take a look at how many shares Kirby and Friends own of the company they are steering, it will help a great deal in understanding much of what GW does.

 htj wrote:

 cyphertheory wrote:

Graphite wrote:
NO COMPANY MUST EVER MAKE PROFIT

No company should trade short term gain against long term viability.

but really, a one line sarcastic reply like that surely isn't your rebuttal to my statement? when did we descend to soundbites and quips to put a point across. come on sir. join the debate in full rather than fishing for an argument.

Welcome to the internet.

Do you see... what I did there?

Anyway, you make a good point. It's easy to lay blame at the feet of the shareholders, publicly owned companies often suffer as a result of things like that, but that's kind of an easy answer, I feel, and one that's overly informed by opinion for my part. So I'll not stop there. Rather, I'll play devil's advocate, and ask why you think they're sacrificing long term viability?

well I would like to start off by saying paying a dividend is not the same as making profit. its saying that rather than investing in the company we will pay excess profit back to share holders (in general and for the most part at least. see HMBCs reminder that they have borrowed to do this before)

I think they are in danger of losing long term viability due to being slow to move with the trends for advertising and media, which allowed other competitors to work their way into the visibility of GW fans. there has been a bigger increase in profits for competitors and a slow down in GW's sales, buoyed only buy increasing prices to keep profits at similar levels. this coupled with the seeming disdain for "vets" or long term customers will eventually see a reduction in recruitment into the hobby over the following years where price increases will no longer be able to keep profits up. with less players there will be less new blood and i think they will see a drop in footfall.

as GW rely on the retail chain as the promotional too (see the reduction in long term customers equate to reduction in clubs playing GW games and competitors games being promoted and played instead) a drop in footfall will be the slow decline that i expect to see.

well that's a quick overview at least. paying dividends means they couldn't find something else in the business that was worthy of the cash, reduced investment in R&D and the like means reduced innovation.

 MeanGreenStompa wrote:

 htj wrote:

 H.B.M.C. wrote:
A dividend doesn't mean they're 'going strong'. All it means is that they paid a dividend. They've borrowed money in the past to do that.

They have? This is not something I'd heard of happening. Seems like a great way to collapse into debt. Oh well, so much for optimism.

Take a look at how many shares Kirby and Friends own of the company they are steering, it will help a great deal in understanding much of what GW does.

I'll not bother looking it up as, from the context of your post, I can assume the number is not insubstantial. Can't say as I'm a fan of that. Rarely is that good for the health of a company.


Automatically Appended Next Post:

 cyphertheory wrote:

well I would like to start off by saying paying a dividend is not the same as making profit. its saying that rather than investing in the company we will pay excess profit back to share holders (in general and for the most part at least. see HMBCs reminder that they have borrowed to do this before)

It's funny, I've worked for a fair few retail chains, and never one that pays dividends without profit. Actually, wait, scratch that - I worked for GW for a while, so I guess I did.

I think they are in danger of losing long term viability due to being slow to move with the trends for advertising and media, which allowed other competitors to work their way into the visibility of GW fans.

Which media would you say has resulted in increased visibility for competitors?

there has been a bigger increase in profits for competitors and a slow down in GW's sales, buoyed only buy increasing prices to keep profits at similar levels. this coupled with the seeming disdain for "vets" or long term customers will eventually see a reduction in recruitment into the hobby over the following years where price increases will no longer be able to keep profits up. with less players there will be less new blood and i think they will see a drop in footfall.

Still playing devil's advocate, here, so don't take offence. What back-up do you have for the assertion of a drop in sales figures? Furthermore, wouldn't you agree that a start-up player is a more valuable customer to GW than one who has been playing for years, and needs to buy a bare minimum of models and supplies?

as GW rely on the retail chain as the promotional too (see the reduction in long term customers equate to reduction in clubs playing GW games and competitors games being promoted and played instead) a drop in footfall will be the slow decline that i expect to see.

Would the long-termers not be replaced, in effect, with a constant cycle of young blood? Surely the existing popularity of the game will fuel new interest on a more constant level?

well that's a quick overview at least. paying dividends means they couldn't find something else in the business that was worthy of the cash, reduced investment in R&D and the like means reduced innovation.

What R&D do you think GW are missing out on? The rules are constantly being changed, and modelling processes upgraded and altered, do you not think that this fills the role of necessary R&D to keep the market fresh?

To be clear, I actually agree with most of what you said, but I think it's an interesting discussion that I'd like to open up a bit.

 htj wrote:


I'll not bother looking it up as, from the context of your post, I can assume the number is not insubstantial. Can't say as I'm a fan of that. Rarely is that good for the health of a company.

Funny. Conventional capitalist-wisdom for rewarding management with shares of the company is to have them (self-)interested in the success of the enterprise in the first place.




Automatically Appended Next Post:

 htj wrote:


It's funny, I've worked for a fair few retail chains, and never one that pays dividends without profit. Actually, wait, scratch that - I worked for GW for a while, so I guess I did.

GW made solid and growing profits according to their last financial statement (not least, by their words, due to many of the things people on this board hate, such as the rumour-lockdown/surprise release-strategy).

 Zweischneid wrote:

 htj wrote:


I'll not bother looking it up as, from the context of your post, I can assume the number is not insubstantial. Can't say as I'm a fan of that. Rarely is that good for the health of a company.

Funny. Conventional capitalist-wisdom for rewarding management with shares of the company is to have them (self-)interested in the success of the enterprise in the first place.

That's the purpose of a bonus, tied to profits. There should never be incentive to milk a company for dividends on shares, as this can have a very negative impact.

 Zweischneid wrote:

 htj wrote:


I'll not bother looking it up as, from the context of your post, I can assume the number is not insubstantial. Can't say as I'm a fan of that. Rarely is that good for the health of a company.

Funny. Conventional capitalist-wisdom for rewarding management with shares of the company is to have them (self-)interested in the success of the enterprise in the first place.

Conventional capitalist wisdom does not extend to your executives steering the company based on their own shares and financial profiteering, which in the case of borrowing to pay for dividends, would appear on paper to be the case.

 Zweischneid wrote:

 htj wrote:


It's funny, I've worked for a fair few retail chains, and never one that pays dividends without profit. Actually, wait, scratch that - I worked for GW for a while, so I guess I did.

GW made solid and growing profits according to their last financial statement (not least, by their words, due to many of the things people on this board hate, such as the rumour-lockdown/surprise release-strategy).

They've also made fascinating statements regarding the price elasticity of their customer base - Proven untrue by their own falling sales figures, and the worth of their plastics to be brought into line with their metals pricewise - Also, according to actual sales transactions falling, proven untrue.

Borrowing to finance dividend speaks more on liquidity at a moment in time rather than a lack of profits which is not really an issue that GW have.

All traded companies also need to have a certain level of cash in the bank. A lack of this can indicate cashflow problems and generally send gitters about the city. Borrowing to maintain this while paying shareholders their due is a viable cost vs the possible problems of not us ring that liquidity in place.

Also if I've said this once I've said it five or six times, if kirby (who lead the management buy out all those years ago) didn't have significant holdings in the company that he runs that would be more suspicious than the fact that he holds 8-9(?)% of GW stock.

Also it is a small company so aquiring a significant holding is even less noteworthy.

Nothing to see here except my annoyance at not buying GW shares a few years ago.

@notprop

Surely the lack of liquidity at the time for dividends to be paid at least shows bad budgeting?

 htj wrote:

GW made solid and growing profits according to their last financial statement (not least, by their words, due to many of the things people on this board hate, such as the rumour-lockdown/surprise release-strategy).

I have to confess ignorance on this. Anywhere the numbers are visible?

GW's profits haven't been growing at all. They've been pretty much the same for the last 5 or so years. Now, coupled with rising prices this tells us one of two things. Either the same amount of people are buying less or GW are shifting less stock due to there being less and less people willing to buy it.

 notprop wrote:


Nothing to see here except my annoyance at not buying GW shares a few years ago.

Aye and me, if you cant beat em....

Ok, rather than a screamed soundbite I'll provide a more thoughtful reply.

Every time a thread like this turns up, the subject instantly becomes that GW should spend thier money on something else, and that Kirby is evil for wanting paid.

Companies really don't work like that GW's trend for a good while seems to have been constant, stable dividends to keep their constant, stable investors happy. Switch away from that and the investors may get spooked.

 Grimtuff wrote:

 htj wrote:

GW made solid and growing profits according to their last financial statement (not least, by their words, due to many of the things people on this board hate, such as the rumour-lockdown/surprise release-strategy).

I have to confess ignorance on this. Anywhere the numbers are visible?

GW's profits haven't been growing at all. They've been pretty much the same for the last 5 or so years. Now, coupled with rising prices this tells us one of two things. Either the same amount of people are buying less or GW are shifting less stock due to there being less and less people willing to buy it.

Ah, a rebuttal! But I have to ask, where is everyone getting their information from? GW don't make their figures public, do they?

 htj wrote:

 Grimtuff wrote:

 htj wrote:

GW made solid and growing profits according to their last financial statement (not least, by their words, due to many of the things people on this board hate, such as the rumour-lockdown/surprise release-strategy).

I have to confess ignorance on this. Anywhere the numbers are visible?

GW's profits haven't been growing at all. They've been pretty much the same for the last 5 or so years. Now, coupled with rising prices this tells us one of two things. Either the same amount of people are buying less or GW are shifting less stock due to there being less and less people willing to buy it.

Ah, a rebuttal! But I have to ask, where is everyone getting their information from? GW don't make their figures public, do they?

Annual shareholders reports.


http://investor.games-workshop.com/wp-content/uploads/2012/07/Final-group-accounts-3-June-2012.pdf

EDIT: Never mind, faster than me.

 htj wrote:
@MGS

Where are these available?

http://investor.games-workshop.com/

there is a pretty full rundown in this thread on warseer

http://www.warseer.com/forums/showthread.php?348412-It-s-that-time-again-GW-2012-Financials

 htj wrote:
Ah, a rebuttal! But I have to ask, where is everyone getting their information from? GW don't make their figures public, do they?

Yes, they do. As a publicly traded company they are required to do so by law.

 AlexHolker wrote:

 htj wrote:
Ah, a rebuttal! But I have to ask, where is everyone getting their information from? GW don't make their figures public, do they?

Yes, they do. As a publicly traded company they are required to do so by law.

Yeah, I realise now that it was a stupid question.


Automatically Appended Next Post:
According to this document their profits have appeared to have risen significantly over the last five years. Am I reading this wrong?

 htj wrote:
@notprop

Surely the lack of liquidity at the time for dividends to be paid at least shows bad budgeting?

Not really. Cashflow is a liquid concept in that differs on a daily basis. Reports are a snapshot in time and companies will try to boost this to give the best reflection of their company to the market. So cash will be hoarded At half and full year by deferring payments as much as possible (legal!). Debts are less looked at at lower levels, so you could reasonably borrow at year end for a dividend payment without worry if like GW you have low debts anyway.

Further you can also do this if you are confident that there is money incoming to five the debt. GW have significant licence fees due in At certain points so they could bank on that coming in. They have also in the past spread large incoming licence payments over the purse of a number of years rather than the imediate point in time that it is paid.

 notprop wrote:

 htj wrote:
@notprop

Surely the lack of liquidity at the time for dividends to be paid at least shows bad budgeting?

Not really. Cashflow is a liquid concept in that differs on a daily basis. Reports are a snapshot in time and companies will try to boost this to give the best reflection of their company to the market. So cash will be hoarded At half and full year by deferring payments as much as possible (legal!). Debts are less looked at at lower levels, so you could reasonably borrow at year end for a dividend payment without worry if like GW you have low debts anyway.

Further you can also do this if you are confident that there is money incoming to five the debt. GW have significant licence fees due in At certain points so they could bank on that coming in. They have also in the past spread large incoming licence payments over the purse of a number of years rather than the imediate point in time that it is paid.

Well, there you go. Interesting stuff, thanks. The licensing issue raises a thought. I wonder how GW would be affect by the possible folding of THQ.

 Grimtuff wrote:

GW's profits haven't been growing at all. They've been pretty much the same for the last 5 or so years. Now, coupled with rising prices this tells us one of two things. Either the same amount of people are buying less or GW are shifting less stock due to there being less and less people willing to buy it.

Or... as stated in the last financial report, they are simply hiring more people and investing into their machines and other things (Hobbit license?), meaning that rising prices - inflation - investments may not necessarily net fewer sales at similar net-profits.

 Zweischneid wrote:

 Grimtuff wrote:

GW's profits haven't been growing at all. They've been pretty much the same for the last 5 or so years. Now, coupled with rising prices this tells us one of two things. Either the same amount of people are buying less or GW are shifting less stock due to there being less and less people willing to buy it.

Or... as stated in the last financial report, they are simply hiring more people and investing into their machines and other things (Hobbit license?), meaning that rising prices - inflation - investments may not necessarily net fewer sales at similar net-profits.

That would seem to be at odds with the changing down of stores to single person operations? You can always put 'hiring more people' in a financial report, these things are always a massive exercise in spin after all, when you actually hire new people over the course of the year, that statement does not detract from letting more people go than you're bringing in.


I know the casting machines, especially the plastics, are costly and I expect new setups were required for the new Hobbit minis. I'm hoping to see a solid increase in sales when these movies are released, along the lines of the LotR boost they saw during those movies era. I'd love to also see that profit used to strengthen the company and invest in the long term paying games of 40k and fantasy, instead of maximise dividend.

 htj wrote:

 notprop wrote:

 htj wrote:
@notprop

Surely the lack of liquidity at the time for dividends to be paid at least shows bad budgeting?

Not really. Cashflow is a liquid concept in that differs on a daily basis. Reports are a snapshot in time and companies will try to boost this to give the best reflection of their company to the market. So cash will be hoarded At half and full year by deferring payments as much as possible (legal!). Debts are less looked at at lower levels, so you could reasonably borrow at year end for a dividend payment without worry if like GW you have low debts anyway.

Further you can also do this if you are confident that there is money incoming to five the debt. GW have significant licence fees due in At certain points so they could bank on that coming in. They have also in the past spread large incoming licence payments over the purse of a number of years rather than the imediate point in time that it is paid.

Well, there you go. Interesting stuff, thanks. The licensing issue raises a thought. I wonder how GW would be affect by the possible folding of THQ.

I'm guessing money in advance or at least mostly in advance would see GW alright. I think there was a significant license inclusion in the last two years as well as a renewed way of managing that one off income throughout the course of the license iirc.

If the licence is drafted in a fairly normal fashion bankruptcy/insolvency will be cause to terminate the contract and recover costs by GW. They will then procure a new licensee. Could earn GW a few £ if all the peices fell into place.

@notprop

Well, that'd be something positive to come out of it, at least.

 MeanGreenStompa wrote:


That would seem to be at odds with the changing down of stores to single person operations? You can always put 'hiring more people' in a financial report, these things are always a massive exercise in spin after all, when you actually hire new people over the course of the year, that statement does not detract from letting more people go than you're bringing in.

Perhaps. But whether or not they are spin, they are obviously (but a few) possible reasons why the naive fallacy of "price hikes > increase in profit, ergo GW is loosing customers" just isn't going to fly.

 Zweischneid wrote:

 MeanGreenStompa wrote:


That would seem to be at odds with the changing down of stores to single person operations? You can always put 'hiring more people' in a financial report, these things are always a massive exercise in spin after all, when you actually hire new people over the course of the year, that statement does not detract from letting more people go than you're bringing in.

Perhaps. But whether or not they are spin, they are obviously (but a few) possible reasons why the naive fallacy of "price hikes > increase in profit, ergo GW is loosing customers" just isn't going to fly.

True, that isn't a worthwhile conclusion, a more relevant equation would be to look at the mean increase in retail price of the miniatures (say take 100 items, cost increase in the last 5 years and compare base profits over the last 5 years from the financial reports, then factor in outside influences including the scaling down of staff in shops, the move, especially in North America, from prime mall locations to smaller premises in strip malls and then look at if profit has moved to match the increase in retail price.

You know how getting presents at Christmas is way better than getting just given some cash in hand?

Maybe they could encourage people to invest by paying dividends out in presents..

Say like, one LOTR goblin per 5 shares?

Although, I suppose Kirby would be fethed then... his living room would look like the Mines of Moira.

 mattyrm wrote:
You know how getting presents at Christmas is way better than getting just given some cash in hand?

Maybe they could encourage people to invest by paying dividends out in presents..

Say like, one LOTR goblin per 5 shares?

Although, I suppose Kirby would be fethed then... his living room would look like the Mines of Moira.

Convincing "Investors" to make due with only products instead of equity for risking their money is the idea of the decade. They call it Kickstarter.com

If we're talking about investment, how's the Finecast going these days? Still completely gak?

You'd think they would want to get that all sorted before the Hobbit stuff appears because, well people licensing stuff like LotR don't like it being associated with substandard product.

I can see the Hobbit stuff being 100% plastic, or at least very close to that.

 mattyrm wrote:

 notprop wrote:


Nothing to see here except my annoyance at not buying GW shares a few years ago.

Aye and me, if you cant beat em....

Hey, it has been outperforming the S&P500 since I bought mine last year

Bought it in anticipation of the Hobbit movie announcement.

And thus begins the next semi-annual thread of amateur financial analysis and about how GW is going down the tubes. Same logic and arguments as always. Someone should necromancy the mid year thread just to save us having to type all the same arguments over again.

silent25 wrote:
Same logic and arguments as always

Which are still as valid now as they were when the LotR bubble burst. GW won't be dead tommorow but in a decade?

Time will tell who is right.

Palindrome wrote:

silent25 wrote:
Same logic and arguments as always

Which are still as valid now as they were when the LotR bubble burst. GW won't be dead tommorow but in a decade?

Time will tell who is right.

Except people have been making the same arguments since the mid-90's.

But I agree that the post LotR crash had me believing GW might be going under, but they came back and now seem to be stressing that any extra profits from the Hobbit movies is temporary.

Of course I only plan to keep my stocks till the last Hobbit movie comes out, or earlier if they bomb

*comes back from reading new Hobbit thread*
DEAR GOD!!! SELL!!! SELL!!! SELL!!

If GW can keep recruiting customers at a rate only slightly less than they lose them, the price increases will make up the difference and they'll keep making money. It's not sustainable for ever, but for a long, long time.

Their internal restructuring and cost cutting worked. They're not hemorrhaging money like the end of Kirby's "fat and lazy" (his words) years.

Add in their good access to debt if things go wrong and they can plod along though a decade long dry spell.

The death of the dividend is one of the worst things that happened to the stock market. It used to be unthinkable to not pay out a dividend (well, a long, long time ago anyway) if you had profits. Then if you wanted to reinvest some capital instead, you'd go back to the market and solicit some investment money and issue some stock. I may be a conservative old timer, but i see buying stocks that don't pay dividends like buying rental properties that don't pay rent.

Yes, Kirby et al are lining their own pockets as much as anyone elses, but they're doing the right thing by paying profits to the people who own the business.

That said, GW's market cap makes it a pretty risky investment. It's actually quite a volatile stock. The yield on the dividends isn't anywhere near high enough to justify the risk.

silent25 wrote:

Palindrome wrote:

silent25 wrote:
Same logic and arguments as always

Which are still as valid now as they were when the LotR bubble burst. GW won't be dead tommorow but in a decade?

Time will tell who is right.

Except people have been making the same arguments since the mid-90's.

But I agree that the post LotR crash had me believing GW might be going under, but they came back and now seem to be stressing that any extra profits from the Hobbit movies is temporary.

Of course I only plan to keep my stocks till the last Hobbit movie comes out, or earlier if they bomb

*comes back from reading new Hobbit thread*
DEAR GOD!!! SELL!!! SELL!!! SELL!!

People having been saying that GW was about to fold since the day they opened. The steady annual decline in sales volume since 2004 (? its about then anyway) is what makes me think that they have a limited future unless they re-invent themselves or are simply bought out by Disney.

Time to pretend I know about business and comment on how much GW sucks.

God forbid a company doing company stuff.

 htj wrote:
Good. Glad to see that they're still going strong.

And let's pray that GW leadership don't fall prey to any Hedgefunds robber barons.
Each company being own by the Hedgefunds are usually ruined.

One thing I did read on the warseer link that could cause a problem is the royalties from THQ, if they have defaulted on a credit, can games workshop still expect the
royalties next year from THQ?

If THQ really goes bankrupt, they might miss out on that.

Really though, the license is worth something and another dev will swoop it up in the longer run. Not really a permanent setback.

Wait, THQ are skint?! I hadn't heard.. and I'm gutted, I am a big fan of them, I own at least 5 or 6 of their games, and all of the 40K themed ones.

I'm somewhat stunned by that news, I really struggle to understand how large well known companies that produce such good products manage to feth up so badly.

Surely most of their games sell well right?

They made some really bad choices (apparently Udraw cost them $50 million). They aren't quite dead but they have until the 15th of January before their bank calls in their loans. They are supposed to have found some mystery backer though so they may well survive, at least in some fashion.

Well if nothing else the bank will try to keep them going somehow; that way they'll see a little more money back at least. There's a lot of knowhow and skill concentrated in THQ; it'd be a shame to let that go to waste (and bad for the bank, as well)!

I suspect that the money will be found by selling off assests, i.e. studios and game IPs. They could wait and allow them to release COH2, Metro and their other games nearing completion but I suppose that depends on how much risk the bank is willing to take.

Just for your information: Tom Kirby, chairman of the board, gets 383,650 £ out of this decision by the board. His current salary is 352,000 £. Not considered are the dividends his wife gets.

 Kroothawk wrote:
Just for your information: Tom Kirby, chairman of the board, gets 383,650 £ out of this decision by the board.

Excellent! Now he'll be able to afford that ivory back scratcher!

Crappy ivory? Bah, make it a Finecast back scratcher, plus a box of the new Hobbit Trolls

Games Workshop's Escape from Goblin Town starter set. Will presumably sell for GBP 80,- in the limited edition version. Contains 56 miniatures
Lego's Battle of the Goblin King set. Sells for GBP 79,99 SRP in the regular version. Contains 7 miniatures.

Just sayin...

 Zweischneid wrote:
Just sayin...

Yes, but why...?

Totally different products. And nothing to do with the topic at hand.

 insaniak wrote:

 Zweischneid wrote:
Just sayin...

Yes, but why...?

Totally different products. And nothing to do with the topic at hand.

Was meant as a reference to the discussion of GW pricing themselves out of the market with overblown price hikes.

Example:

If GW can keep recruiting customers at a rate only slightly less than they lose them, the price increases will make up the difference and they'll keep making money. It's not sustainable for ever, but for a long, long time.

I'm not sure what you think the example was showing, though. Yes, the Lego set only contains 7 'miniatures' (ignoring, of course, little details like the rest of the set). You could also point out that a single Sideshow Collectibles statue will cost you the same or more, and only contains a single 'miniature'... and it would still be completely irrelevant as an illustration of whether or not GW are out-pricing their customer base.

 insaniak wrote:
I'm not sure what you think the example was showing, though. Yes, the Lego set only contains 7 'miniatures' (ignoring, of course, little details like the rest of the set). You could also point out that a single Sideshow Collectibles statue will cost you the same or more, and only contains a single 'miniature'... and it would still be completely irrelevant as an illustration of whether or not GW are out-pricing their customer base.

Is it? Comparisons of products with the exact some price tag for the exact same IP licence made from pretty much identical basic materials released virtually at the same time and you're saying they are not comparable?

By any measure, they certainly offer far better benchmarks for analysis than, for example, the incredibly flawed comparisons made between GW today and GW 5 years ago, which have far fewer variables in common than the Lego-GW comparison above.

 insaniak wrote:
Yes, but why...?

Totally different products. And nothing to do with the topic at hand.

Because when all you've got is straws, why not clutch at them?

 Zweischneid wrote:
Is it? Comparisons of products with the exact some price tag for the exact same IP licence made from pretty much identical basic materials released virtually at the same time and you're saying they are not comparable?

Given that one is marketed (ahem...) to wargamers, and the other is a toy that will sell for kids and collectors, yes, they are not directly comparable. Not when what you are trying to counter is the claim that GW's prices are eroding their customer base.

Lego has always (or at least for the last 30 years or so) been expensive. That generally works for them because they are also the best brand in their niche, and are a name that everyone knows, although they supposedly were having some financial difficulties for a while there that were turned around by the initial release of the Bionicle range followed by the Star Wars 'licence to print money' aquisition. But the amount that collectors and parents are willing to spend on Lego for their kids has no bearing whatsoever on whether or not gamers are willing to continue buying GW miniatures when GW keeps raising their prices. The only valid comparison there is GW's sales figures now compared to GW's sales figures from a time when they weren't as expensive per miniature... although even that is going to only give you a partial picture, since there are more factors involved that just the cost per miniature.

What are wargamers but kids and collectors? Yes, they collect slightly different products, but not incomparably so (as in.. dunno.. comparing GW to PepsiCo or something).

And Lego's transformation from (mainly) a fairly homogenous "hobby-product" to a strategy of (mainly) "splash-releases" of both their own branding and licensed branding isn't dissimilar to what GW is trying to do either.

 Zweischneid wrote:
What are wargamers but kids and collectors? Yes, they collect slightly different products, but not incomparably so (as in.. dunno.. comparing GW to PepsiCo or something).

To some extent that's correct, and moreso (at least the collectors part) for LOTR product, which largely didn't sell to GW's 40K and WHFB customers, but more to LOTR fans specifically... but that in itself also makes LOTR product a poor reflection of what is going on with GW generally. You can generally get away with charging a little more for licensed product, because people are a little more willing to spend for it, and it's not intended to have long-term viability... it just sells while people are still excited about the movie.


But you can't just directly compare the price of a Lego set (that incidentally doesn't yet have a proven sales record, so we have no way of knowing whether consumers will see that price as acceptable) against a similarly so-far unreleased GW miniature set and claim that it proves anything other than that the two sets are a similar price.

Incidentally, that 'move to splash releases' for Lego happened in the 80's. It's not a new thing. It's just more apparent these days as they cycle in new sets a little faster than they used to.

This article makes pretty interesting reading, written about 18 months ago (the last dividend payment? Was there another in-between then and now?) but a lot of it is still valid.

http://theback40k.blogspot.co.uk/2011/04/help-kirby-is-eating-our-hobby.html

I guess the argument goes back and forth as to whether you think it's a good thing that GW is a publicly owned company. I would tend to say no - GW changed from a company made 'by us, for us', into one that is seemingly run by suits on all levels, and only has the bottom line in mind. Most of the things that seem to tick people off (the lack of innovation, perennial price rises, resin problems) are probably related to it as it doesn't seem that any other companies have these problems, or at least on anything like the same scale.

Also, on a personal level I don't think it's right that GW lays off hundreds (thousands?) of staff in a time when sales are reducing, and then the CEO gets that amount of money in a year - more than a little obscene IMO considering the scale of the industry we are talking about here. I'm sure there are examples of much worse happening in other businesses/industries, and no doubt this will get a 'well that's the way the world works, duh' argument, but that doesn't make it any more palatable.

 Pacific wrote:
I would tend to say no - GW changed from a company made 'by us, for us', into one that is seemingly run by suits on all levels, and only has the bottom line in mind.

Careful now my oceanic friend – some chucklehead is sure to twist the above statement and say something like“So it’s not ok for a company to want to make money?” or “So they shouldn’t cater to their shareholders?” or something equally as pithy (READ: irrelevant).

 cyphertheory wrote:
Ah the Kirby gravy train keeps on'a rollin choo choo! kinda hard to think that they couldnt use the money for RnD to improve certain products or infrastructure before paying dividends

Yeah, much better to have a smaller dividend, then the shareholders will abandon GW, devaluing the stock, and the company can be bought and stripped by someone else! Yeah, sounds great!

Oh honestly Kaldor. While Zwie clutches at a few straws all you seem to want to do is build straw men just to knock 'em down.

Do you think that's what he meant? Do you think that's what he wants?



[EDIT]: Oh, and, prophecy fulfilled Pacific. It only took one post.

 H.B.M.C. wrote:
Oh honestly Kaldor. While Zwie clutches at a few straws all you seem to want to do is build straw men just to knock 'em down.

Do you think that's what he meant? Do you think that's what he wants?

I'm sure I don't need to explain to a sharp man like yourself why not paying a dividend is a bad thing. Perhaps you could explain it to cyphertheory though, since he seems to think paying dividends is a bad idea.

 Kaldor wrote:
Yeah, much better to have a smaller dividend, then the shareholders will abandon GW, devaluing the stock, and the company can be bought and stripped by someone else! Yeah, sounds great!

Actually that's an awesome scenario. Stock prices crash, WOTC buys GW, and finally the 40k IP is in the hands of professional game designers and we get a balanced and thoroughly tested product like MTG instead of the current "we're a model company, not a rules company" joke.

Or Hasbro buys it and we are stuck with gak. Ultramarines really becomes the Smurfs etc etc.

Zweischneid wrote:
Was meant as a reference to the discussion of GW pricing themselves out of the market with overblown price hikes.

Example:

If GW can keep recruiting customers at a rate only slightly less than they lose them, the price increases will make up the difference and they'll keep making money. It's not sustainable for ever, but for a long, long time.

First of all, the LEGO kit has 841 pieces, not just 10 minis.

Second of all, you are not understanding what I meant by that text of mine you quoted. If they can recruit enough that combined with price increases to make the same or more money with less expenses, how in the world is that "pricing themselves out of the market with overblown price hikes"? The fact that GW can replace enough customers to make more money last year than the year before shows that they have not yet priced themselves out of the market. My post was the wrong one to use as an example because it's saying that opposite of what you are making it out to say.

Kirby just got a lot richer with this dividend. It's what? 10-15 times the average person's income in the UK? And this is in addition to the salary he pulled of roughly the same amount.

GW is a money machine for the guy in charge. He's not going to change GW's direction. Why should he? He's sailing towards a golden retirement most can only dream of. If he's smart, he'll keep cutting internal costs, keep raising prices 10-15% a year and keep paying himself an impressive salary and even more impressive dividends. GW will stay the course and if change eventually becomes unavoidable, Kirby will retire a rich, rich man and it'll be someone else's problem. Perhaps his crowning achievement before retirement will be to arrange the sale of GW to a larger corporation in a way that lines his pockets even further.

Somehow I don't think he cares if I or anyone else in this thread sees him as a parasite feeding on the hobby.

 pixelpusher wrote:
Or Hasbro buys it and we are stuck with gak. Ultramarines really becomes the Smurfs etc etc.

Hasbro is the parent company of WOTC, and they're smart enough to let WOTC do their job of developing games and just collect the nice profits. MTG hasn't suffered from being in that situation, so why would GW?

 Kaldor wrote:

 H.B.M.C. wrote:
Oh honestly Kaldor. While Zwie clutches at a few straws all you seem to want to do is build straw men just to knock 'em down.

Do you think that's what he meant? Do you think that's what he wants?

I'm sure I don't need to explain to a sharp man like yourself why not paying a dividend is a bad thing. Perhaps you could explain it to cyphertheory though, since he seems to think paying dividends is a bad idea.

love to read the quote you will be able to give me where I made that statement?

first comment was on Tom Kirby making a mint out of GW paying dividends (no conflict of interest there then) and the second that I find it worrying that they couldn't find somewhere in the business to spend that money given the observed trend in reduction in number of sales meaning reduced product leaving the shelves (buoyed by a larger price tag on each item in an annual price rise to cover it) bearing in mind that in the 2010 annual report they said that they would only pay dividends on "truly surplus" profits

but yes please twist what I said into paying dividends is bad.

For me my army is established so im good.

But given prices i wont be starting a second 40k army.

Equally how many parents see that starer set now and recoil. There is a price sensitive point, especially given most parents have little appreciation of what game systems have a strong tournament scene let alone imagining little jonny getting deep into it.

As a product line that leaves innovation to enhancements like pushing terrain and fliers, which was clever. But again there is a limit how much you can push that, or codex creep, before your customer gets frustrated and goes back to world of warcraft or whatever other escapism they enjoy.

Its not just Dakka where GW patron are angry. Its TOs who now are completely meh about substitute minis right through to gamers no longer allowed to use GW paints to those in Sth Hemisphere no longer allowed to buy from maelstrom.

Talk to me about frustrated customers, financial statements and throw in a mention of blackberry/RIM loyal customers.

As a GW shareholder I thought I’d chime in here (yes I am one of the few who hold shares in GW and play wargames)

Barring for a moment the fact that as a Limited company GW is legally required to maximise profit for the shareholders, the dividend for GW really isn’t that high, particularly when you factor in the high cost of share at the moment.

People claim the money would be better spent on R&D, but have you seen GWs costs in comparison to there total expenditure? Now I admit that I’m not aware what all this cost is, but I would imagine that a very large portion of it is R&D. Considering that their cost to profit ratio is nearly 3 times every other company I invest in I think you would have a hard time convinceing investors that more R&D is needed at the expense of this dividend.

Lets not forget that shareholders have invested money in GW – often for no other reason than to see a return on that money, therefore to maintain that investment GW really have to offer a dividend atleast higher than the investors could get from having the money in the bank (for FTSE 100 companies the main shareholder profit comes from the high fluctuation of the price, buying low and selling high – GW doesn’t have this and sometimes can go days without anyone trading)

Indeed I think GW does well to get away with the small dividend/high R&D budget that they do, hell at the last shareholder meeting I got into a rather heated debate with another shareholder who couldn’t understand why GW were replacing functioning (and I’m suffering a mental block on the term now so I’ll call them machines to make models) the idea of making better quality modelsto keep up/ahead of competition made no sense to him "as GW models are needed for GW games", and no matter how I tried to make him see the sense of the investment he couldn’t.

The fact is GW has to keep us, the gamers happy – and the investors, many of who have never played a wargame in their life. Personally I think they do a good job all things considered.

I did like the persons suggestion of giving models instead of a dividend, I can just imagine the look on a pensioners face when his pension fund explains that his pension didn’t go up in value due to no dividend, but here is a nice plastic goblin for him to play with

Just as a general point of information, limited companies are not legally required to maximise profit for shareholders, they are legally required to fulfil the objectives set out in their founding documents.

GW haters are like marxists and fundamentalist Christians...they've been predicting the imminent end for years now

 Testify wrote:
GW haters are like marxists and fundamentalist Christians...they've been predicting the imminent end for years now

we're not haters, we're just "very disappointed". which we all know is a lot worse

Stranger83 wrote:
Considering that their cost to profit ratio is nearly 3 times every other company I invest in I think you would have a hard time convinceing investors that more R&D is needed at the expense of this dividend.

Has any other company you invest in, a strict "no advertising" and "no introductory products" and "raise starter cost by 10% each year" and "declining sales are fine as long as shareholders get more than annual profit" policy?

My stance is that with a minimum of standard business strategies, GW could easily raise sales, revenue and profit by 50% within 1-2 years.

 Kroothawk wrote:

Stranger83 wrote:
Considering that their cost to profit ratio is nearly 3 times every other company I invest in I think you would have a hard time convinceing investors that more R&D is needed at the expense of this dividend.

Has any other company you invest in, a strict "no advertising" and "no introductory products" and "raise starter cost by 10% each year" and "declining sales are fine as long as shareholders get more than annual profit" policy?

My stance is that with a minimum of standard business strategies, GW could easily raise sales, revenue and profit by 50% within 1-2 years.

Each question in turn:

a strict "no advertising" - generally yes, but I'll admit I invest a little different to most people - I'm less in it for the money and more in it for the support to things I find important or enjoy

"no introductory products" - did I dream the DV release?

and "raise starter cost by 10% each year" - actually yes, most companies I know will raise costs to what they think customers will pay, particularly if it can increase the R&D spend (and since the dividend hasn't increased, and costs have, I'm guessing thats where the extra profit goes to - though I suppose it could be "waste")

"declining sales are fine" - in the current climate, yes frankly, as long as profit stays the same or goes up (or even falls slightly at the moment) then that is fine in the short/medium term

"shareholders get more than annual profit" - I don't know any company that gives more dividend than annual profit, Such a company wouldn't stay in business for long. GW are not doing this this year and, dispite looking at my annual reports for the past 5 years, I cannot find any record of them doing this. I'm not saying they never did, just that for as long as I've been involved they have not.

 Peregrine wrote:

 pixelpusher wrote:
Or Hasbro buys it and we are stuck with gak. Ultramarines really becomes the Smurfs etc etc.

Hasbro is the parent company of WOTC, and they're smart enough to let WOTC do their job of developing games and just collect the nice profits. MTG hasn't suffered from being in that situation, so why would GW?

If we change Hasbro to Mattel, do my point get across to you then?

Stranger83 wrote:
"no introductory products" - did I dream the DV release?

I suspect that Kroot wasn't referring to starter sets, but to 'impulse buy' items.


Automatically Appended Next Post:

 pixelpusher wrote:
If we change Hasbro to Mattel, do my point get across to you then?

You can change it to whatever company you want, and the counterpoint will remain the same: Being bought out wouldn't automatically mean that the game would change.

 insaniak wrote:

Stranger83 wrote:
"no introductory products" - did I dream the DV release?

I suspect that Kroot wasn't referring to starter sets, but to 'impulse buy' items.

Correct.
"As an introduction to our 160 pages rules game, please read these 160 pages of rules, thank you."
That's why Space Crusade and Heroquest, accompanied with a wide distribution and massive TV advertising brought so many veterans to the hobby. The Fantasy starter doesn't even include the stats for the units in the box. And a $125.00 USD Hobbit starter box ("Oh, don't forget to buy glue, a primer, a knife, these 15 paints and this 50$ book on painting for a start.") is quite a hurdle for the target customers.

 Testify wrote:
GW haters are like marxists and fundamentalist Christians...they've been predicting the imminent end for years now

Very few people have been predicting an imminent end to GW, quite the reverse. The chattering internet masses do like to make up happy sound bites though.

By far the biggest slice of GW's expenditure is its chain of stores, R&D is tiny by comparison.

Yay more money for me! :-) Christmas came early.

Stranger83 wrote:
as a Limited company GW is legally required to maximise profit for the shareholders....

People claim the money would be better spent on R&D, but have you seen GWs costs in comparison to there total expenditure? Now I admit that I’m not aware what all this cost is, but I would imagine that a very large portion of it is R&D......

Lets not forget that shareholders have invested money in GW – often for no other reason than to see a return on that money......

Firstly, The company is not legally required to maximise profit for shareholders, it will aim to achieve the objectives of the business.....I.e. more growth, diversification, more emphasis on r&d - yes shareholders are important but management will be fulfilling their goals as well

Secondly, we don't know gw strategy, annual reports are opportunities to carry out information transfer and generally talk the business up...we don't now how much they spend on r&d - it is not possible to summise they are purely maximising revenue, we don't know the longer term strategy.

Finally I imagine there is no more than five or six major shareholders and I am sure they will be part of a balanced portfolio for pension companies etc, they will not be expecting massive returns....just a certain type of return within a per-determined timeframe.

And consider yourself lucky you even get dividends......apple went from 1995 to 2012 without paying a single dividend.....

So lets try to work out the key to this, what is gw's strategy moving forward, I think personally gw are dominant with a virtually unchallenged business model .....I.e. vertically integrated right through the supply chain with a highly differntiated product (through the unique ip) and therefore because of this in my oppinion they will be around until technology changes them (3d printing), they then have to adapt to meet the tech changes or somebody else will enter market around this technology.

Just my thought.......Gonna be worth watching though

Lovepug13 wrote:
Firstly, The company is not legally required to maximise profit for shareholders, it will aim to achieve the objectives of the business.....I.e. more growth, diversification, more emphasis on r&d - yes shareholders are important but management will be fulfilling their goals as well

And besides that, "increase profit for shareholders" is not the same as "give shareholders as much profit as possible right now". It's quite possible that if GW stopped paying dividends and focused on long-term growth (along with things like recognizing that it's not 1990 anymore and the internet is important) the profit over time would be larger than the current short-sighted plan.

 Testify wrote:
GW haters are like marxists and fundamentalist Christians...they've been predicting the imminent end for years now

And painting anyone who dislikes GW's practices as a 'hater' is akin to idiocy.

 htj wrote:

 AlexHolker wrote:

 htj wrote:
Ah, a rebuttal! But I have to ask, where is everyone getting their information from? GW don't make their figures public, do they?

Yes, they do. As a publicly traded company they are required to do so by law.

Yeah, I realise now that it was a stupid question.


Automatically Appended Next Post:
According to this document their profits have appeared to have risen significantly over the last five years. Am I reading this wrong?

Sorry to throw this back a few pages, but:

That is because you're reading numeral revenue not constant or real revenue. It doesn't account for inflation which brings down their year to year significantly.

Were I GW strategy i would get people hooked with good cheap intro product.

It now does my head in to have crappy minis. That means bits off the next, better HQs etc. all easy to justify as im rounding out, not extending. Except of course im still spending on the hobby.

Were i to get my hands on say some necrons and i started rounding out there prtty soon i would have a substantial force, so then i may as well round out to 1750 for a tourney, then i want a few more things for next tourney..

Full priced kits though are certainly not a catalyst for me to extens into new areas though, and it would seem getting existing addicts to extend would be far lower hanging fruit than introducing new gamers via an expensive retail distribution footprint.


Automatically Appended Next Post:
* bits off the net. Sorry, touchscreen..

time to buy 1000 shares. profts will continue until the hobbit 3 breaks in a few years.

 Peregrine wrote:

Lovepug13 wrote:
Firstly, The company is not legally required to maximise profit for shareholders, it will aim to achieve the objectives of the business.....I.e. more growth, diversification, more emphasis on r&d - yes shareholders are important but management will be fulfilling their goals as well

And besides that, "increase profit for shareholders" is not the same as "give shareholders as much profit as possible right now". It's quite possible that if GW stopped paying dividends and focused on long-term growth (along with things like recognizing that it's not 1990 anymore and the internet is important) the profit over time would be larger than the current short-sighted plan.

Agreed......of course the paying of the dividend does not mean that they are not focused on long term growth.

As suggested its about cutting through all the rubbish to understand exactly what they are trying to accomplish...

Palindrome wrote:
Very few people have been predicting an imminent end to GW, quite the reverse. The chattering internet masses do like to make up happy sound bites though.

By far the biggest slice of GW's expenditure is its chain of stores, R&D is tiny by comparison.

True. The best thing to happen price-wise would be a drop in gas/electric prices. Given this government's policies, that's not likely any time soon.

H.B.M.C. wrote:

 Testify wrote:
GW haters are like marxists and fundamentalist Christians...they've been predicting the imminent end for years now

And painting anyone who dislikes GW's practices as a 'hater' is akin to idiocy.

Good job I didn't say that then isn't it?

Let's not spoil the thread with a slanging match.

HI all.
So Mr Kirby gets over £340000 bonus from this last dividend pay out! .

And when we look how well GW plc has done since the LoTR bubble burst...(2005 .Mr Kirby admitted the GW corperate management had been 'fat and lazy'.)

IF GW prices had stayed the same They should have a turn over of over £170 M.

Well I hear you say were in a recession, so £40 M down is not that bad...

Well it would not be if GW did not put prices up over the rate of inflation....

Including the price increases GW plc should be attaining a turn over in excess of £280 M!!!

So Kirby has driven away about half the customer base in the last 8 years.And picked up over £2 M in share bonuses!

IMO this is not good.

It's great for him though! Honestly I don't this means anything because people were wailing about how they gave out a dividend last year too. They are simply playing business and not warhammer. It is their company after all.

Sales in Million pounds:

2008->110
2012->131

Increase in % = 19%

Any one knows how do their prices fair today VS those of 2008?. Are they under 20% more expensive, thus proving their buisness has grown, or over 20% thus showing it has shrinked?.

You have to factor in inflation as well before determining how profits have gone up or down.

 Howard A Treesong wrote:
You have to factor in inflation as well before determining how profits have gone up or down.

No i dont, i am not interested in profit but in units sold, the size of the customer base, not how much money they made out of each box, which no doubt i would imagine, with newer tech can only be better.

Yeah you kinda do, otherwise your numbers are meaningless.

Lanrak wrote:
And when we look how well GW plc has done since the LoTR bubble burst...(2005 .Mr Kirby admitted the GW corperate management had been 'fat and lazy'.)

Well they're certainly not being fat and lazy now. They're pro-actively raising the prices of the new Hobbit race to astronomical levels ($95 for the rickety old wood terrain? WT-f'ing-F!), so that they can rake in as much as humanly possible over this smaller (but hopefully larger) LotR bubble.

xxvaderxx wrote:

 Howard A Treesong wrote:
You have to factor in inflation as well before determining how profits have gone up or down.

No i dont, i am not interested in profit but in units sold, the size of the customer base, not how much money they made out of each box, which no doubt i would imagine, with newer tech can only be better.

Let's say that GW’s price inflation between 2008 and 2012 was 30%.

Thus if they sold 100 million of models in 2008, they could sell the same number of models in 2012 and their sales would be 130 million.

If their sales in 2012 were 120 million, it would indicate that they sold about 8% fewer models in 2012 than in 2008, all other things being equal.

Please note that I have made up the above figures for the sake of illustration.

 Kilkrazy wrote:

xxvaderxx wrote:

 Howard A Treesong wrote:
You have to factor in inflation as well before determining how profits have gone up or down.

No i dont, i am not interested in profit but in units sold, the size of the customer base, not how much money they made out of each box, which no doubt i would imagine, with newer tech can only be better.

Let's say that GW’s price inflation between 2008 and 2012 was 30%.

Thus if they sold 100 million of models in 2008, they could sell the same number of models in 2012 and their sales would be 130 million.

If their sales in 2012 were 120 million, it would indicate that they sold about 8% fewer models in 2012 than in 2008, all other things being equal.

Please note that I have made up the above figures for the sake of illustration.

Exactly what i was going for, thou dont quite remember prices back in 08, gut feeling tells me they were about 60 to 70 percent of current prices, thou i have no basis for those numbers.

Here is a table I worked out about 18 months ago, so it doesn't include 2010 -- 2011 results.



What this shows is the revenue for each year, inflated yearly by the UK consumer price index as you read across to the right. Thus, in the right hand column you can read for example what 2002's revenues are worth in 2010's inflated GBP.

If you look at the 2002 revenue, it is only 108.6M GBP, compared to 121.8M in 2010. However, inflation means that the 108.6M from 2002 is worth 136.3M in 2010 value GBP. In other words, revenues had fallen in 2010.

What the table does not show is GW's own price inflation, which is considerably faster than the UK CPI. Given considerably faster selling price inflation, and static or falling revenues, clearly they are selling fewer units and compensating with higher prices.

This does not meant that profits fell, though. The table makes no account of cost of goods, and soon.

In fact I believe that GW's sales have recovered somewhat since 2010 and their profitability has increased, thanks to reorganisation of the retail chain. OTOH I believe their units sales are probably still falling.

Pretty much what i expected.

I can feel this will be a bit of a ramble, so I apologise for that in advance.

 Kilkrazy wrote:
Just as a general point of information, limited companies are not legally required to maximise profit for shareholders, they are legally required to fulfil the objectives set out in their founding documents.

Firstly let me concede this point, I had been involved is discussing banks all day when I posted this (who are required to maximise profits) and my tired brain failed to make the separation, it is of cause correct that a PLC is not required to maximise profits unless that was its founding principle.

 Kroothawk wrote:

 insaniak wrote:

Stranger83 wrote:
"no introductory products" - did I dream the DV release?

I suspect that Kroot wasn't referring to starter sets, but to 'impulse buy' items.

Correct.
"As an introduction to our 160 pages rules game, please read these 160 pages of rules, thank you."
That's why Space Crusade and Heroquest, accompanied with a wide distribution and massive TV advertising brought so many veterans to the hobby. The Fantasy starter doesn't even include the stats for the units in the box. And a $125.00 USD Hobbit starter box ("Oh, don't forget to buy glue, a primer, a knife, these 15 paints and this 50$ book on painting for a start.") is quite a hurdle for the target customers.

OK, now I see what you mean, and yes GW miss a trick here, Space Hulk is the closest thing I can think of but for some inexplicable reason they made it a limited edition item – but I will grant you this is something I think they should make a permanant item in the store. Similarly I’d love to see a return of warhammer quest (or something similar).

Now, onto the profit/customer base thing. People seem to be making an assumption here that a 30% rise in the price that GW charge means that their profits should go up by 30%, but that isn’t the case. Some of the rise will go in the increased cost of raw materials – which are getting more expensive by the day, some will go on higher wages for the staff (due to inflation), some will go on increased costs – lets not forget the machines run on electricity and the cost of that has gone up 30% in the past 2 years. I don’t know what the last 5 years of GW increases equate to, nor do I know what their increased costs equate, I’m fairly sure that their increases are higher than their costs. The point is that the real expected profit increase should be rises – cost, not just rises alone.

I’m not saying that the customer base hasn’t gone down, I’m sure it has. I’m also not saying that GW do everything right, indeed there are many things I disagree with. But at a time of recession, when even companies like Tesco that provides an essential item (in this case food) makes it first ever loss, it is hardly surprising that people are cutting back on the luxuary items of miniatures. At these times a falling customer base isn’t unreasonable.
Of cause this takes us a little off point of the dividend, which I’ll come back to a little now. Someone pointed out that Apple had gone 4-5 years without paying a dividend, now this is true but Apple are a high volume traded company and attract a different kind of investor. (Please note the following is a generalization and I’m sure there are many who do not do this) People who trade in Apple do so for a “quick buck” by this I mean they buy up shares when they consider they are cheap in the hopes that an hour/day/week from then the price will be higher and they can sell them and make their profit. With this kind of investor you can afford not to pay a dividend as they expect to get their money from the rising price of the shares. Now GW on the other hand is a very low volume transaction stock, I’ve seen it go days without anyone trading before. As a result of this the price vary rarely moves (though for reasons I’m not entirely sure on this year they have done very well) and as a result the shareholders expect the dividend to get their return on investment.

As said at the start, that’s a huge generalisation, but does have a lot of truth in it.

And finally For those saying Mr Kirby is doing this to line his own pocket – I think that’s a little unfair. No doubt you would all be saying he was in the wrong if he had no shares in GW as he would have no incentive to run the company better, as one of the major shareholders it’s in his interest to run the company well, and for this reason I’m glad he has so many shares. Lets not forget that if he really was just trying to extract money from GW (in this case around £300k) and ran the company into the ground the share price would crash, making his (currently valued at) £6m worth of shares next to worthless – ask yourself the question, would you give up £6m in 5-10 years time (when I presume he’ll be looking to retire) for £300k now? Even £300k per year for the next 10 years is only half of what his shares will be worth if he keeps the company going strong.

Stranger83 wrote:

I’m not saying that the customer base hasn’t gone down, I’m sure it has. I’m also not saying that GW do everything right, indeed there are many things I disagree with. But at a time of recession, when even companies like Tesco that provides an essential item (in this case food) makes it first ever loss, it is hardly surprising that people are cutting back on the luxuary items of miniatures. At these times a falling customer base isn’t unreasonable.

All the major GW competitors have reported a significant sales growth in the past few years, why isn't their customer base falling as well?

One word; witches. Really I can see a move toward other games while people make the occasional purchase to finish off their armies for warhammer 40k/fantasy. I have no data to back that up, just what I see in my area.

 The Foot wrote:
One word; witches. Really I can see a move toward other games while people make the occasional purchase to finish off their armies for warhammer 40k/fantasy. I have no data to back that up, just what I see in my area.

This, while i do occasionally buy somthing from GW for Fantasy or 40k, they are totally oriented at finishing my CURRENT armies, any new additions or armies i start, i do so on other companies models, including for WHF and 40K.

xxvaderxx wrote:

 The Foot wrote:
One word; witches. Really I can see a move toward other games while people make the occasional purchase to finish off their armies for warhammer 40k/fantasy. I have no data to back that up, just what I see in my area.

This, while i do occasionally buy somthing from GW for Fantasy or 40k, they are totally oriented at finishing my CURRENT armies, any new additions or armies i start, i do so on other companies models, including for WHF and 40K.

This exactly, GW has always been the "starter" company, people get into the hobby via GW (not always, but probably a fairly high percent) and move to other companies once they see that they exist. Now people who are already in the hobby might buy new minis, but at the moment people aren't really looking for a new hobby. As a result people are not buying from GW (as the already have the models) but are buying for other games (as they don't have them).

 Peregrine wrote:

 Kaldor wrote:
Yeah, much better to have a smaller dividend, then the shareholders will abandon GW, devaluing the stock, and the company can be bought and stripped by someone else! Yeah, sounds great!

Actually that's an awesome scenario. Stock prices crash, WOTC buys GW, and finally the 40k IP is in the hands of professional game designers and we get a balanced and thoroughly tested product like MTG instead of the current "we're a model company, not a rules company" joke.

While I agree with your enthusiasm, WOTC should NOT take over GW. Ive dealt with Magic since "Arabian Knights" and if you thought GW flip-flopped on rules, WOTC has a website that is updated DAILY....Think about it...DAILY. Those goons dont playtest ANYTHING!!! The current wave of "playtesting" conducted by WOTC is nothing more than a feeble attempt to placate the cry-babies who wouldnt make the jump to 4th ed. 5th ed is nothing more than a cleaned up version on 3.5

Let the shareholders get a cut of the pie. GW has made its course of action clear since the 80's. When people cry about the high cost of models its kinda like..."Guys, I know gearheads that will easily spend three thousand dollars on a transmission." If its your hobby, then just deal with it or find a different hobby.

 Kilkrazy wrote:

xxvaderxx wrote:

 Howard A Treesong wrote:
You have to factor in inflation as well before determining how profits have gone up or down.

No i dont, i am not interested in profit but in units sold, the size of the customer base, not how much money they made out of each box, which no doubt i would imagine, with newer tech can only be better.

Let's say that GW’s price inflation between 2008 and 2012 was 30%.

Thus if they sold 100 million of models in 2008, they could sell the same number of models in 2012 and their sales would be 130 million.

If their sales in 2012 were 120 million, it would indicate that they sold about 8% fewer models in 2012 than in 2008, all other things being equal.

Please note that I have made up the above figures for the sake of illustration.

Are there any solid numbers on GW price inflation? Someone worked out the average recently was iirc 7/8%. The most popular sets were about 5%.

It doesn't really matter if Iron Straken has gone up 50% in price if tactical squads and predators have gone up 5%.

Difficult to calculate as Finecast versions are technically a new product, but in reality are a considerable price increase. Same with new edition rulebooks and starter boxes. Just look at the current Hobbit prices and you clearly see a trend.

You could estimate easily if you kept track. I doubt anyone has, and GW aren't exactly going to release a list of what prices used to be.

I suppose you could figure it out for the more popular sets using the community but nostalgia's a hell of a thing...

 Testify wrote:
You could estimate easily if you kept track. I doubt anyone has, and GW aren't exactly going to release a list of what prices used to be.
I suppose you could figure it out for the more popular sets using the community but nostalgia's a hell of a thing...

It is not easy as we don't know how much of each product they actually sell. Raising the price of one 100$ product by 100% would have no effect if it doesn't sell, but a considerable effect if 100% of GW sales would be that product (with sales numbers staying constant). Assuming that all GW products sell in exactly the same number is a gross simplification. Tracking price increases for core products like starters, Codices, and core troops makes some sense though.

Someone did do it a while ago but don't ask me to find the thread. You can easily do it for something like Guardsman or Catachans, which haven't changed in years. IIRC, the price has stayed broadly in line with inflation over the years, in real terms it has gone up hugely because you get 10 in a box rather than 20 that you used to.

Stranger83 wrote:

And finally For those saying Mr Kirby is doing this to line his own pocket – I think that’s a little unfair. No doubt you would all be saying he was in the wrong if he had no shares in GW as he would have no incentive to run the company better, as one of the major shareholders it’s in his interest to run the company well, and for this reason I’m glad he has so many shares. Lets not forget that if he really was just trying to extract money from GW (in this case around £300k) and ran the company into the ground the share price would crash, making his (currently valued at) £6m worth of shares next to worthless – ask yourself the question, would you give up £6m in 5-10 years time (when I presume he’ll be looking to retire) for £300k now? Even £300k per year for the next 10 years is only half of what his shares will be worth if he keeps the company going strong.

Fair point, but thinking about how the company seems to be behaving (with everything aimed at the short term), and the Hobbit Bubble likely to burst in about 4-5 years time, I can see Kirby retiring perhaps a year before that happens, a millionaire many times over but leaving the company in an extremely perilous position.

 Pacific wrote:

Stranger83 wrote:

And finally For those saying Mr Kirby is doing this to line his own pocket – I think that’s a little unfair. No doubt you would all be saying he was in the wrong if he had no shares in GW as he would have no incentive to run the company better, as one of the major shareholders it’s in his interest to run the company well, and for this reason I’m glad he has so many shares. Lets not forget that if he really was just trying to extract money from GW (in this case around £300k) and ran the company into the ground the share price would crash, making his (currently valued at) £6m worth of shares next to worthless – ask yourself the question, would you give up £6m in 5-10 years time (when I presume he’ll be looking to retire) for £300k now? Even £300k per year for the next 10 years is only half of what his shares will be worth if he keeps the company going strong.

Fair point, but thinking about how the company seems to be behaving (with everything aimed at the short term), and the Hobbit Bubble likely to burst in about 4-5 years time, I can see Kirby retiring perhaps a year before that happens, a millionaire many times over but leaving the company in an extremely perilous position.

And GW would then face a shareholder derivative action (with some steam behind it) based on Kirby and other directors violating their fiduciary duties of care and loyalty. Stranger83 has it right, directors and employee officers having a large stake in the company is one of the best ways to ensure that the company ISN'T run into the ground, because they stand to lose the most.

 G. Whitenbeard wrote:

 Pacific wrote:

Stranger83 wrote:

And finally For those saying Mr Kirby is doing this to line his own pocket – I think that’s a little unfair. No doubt you would all be saying he was in the wrong if he had no shares in GW as he would have no incentive to run the company better, as one of the major shareholders it’s in his interest to run the company well, and for this reason I’m glad he has so many shares. Lets not forget that if he really was just trying to extract money from GW (in this case around £300k) and ran the company into the ground the share price would crash, making his (currently valued at) £6m worth of shares next to worthless – ask yourself the question, would you give up £6m in 5-10 years time (when I presume he’ll be looking to retire) for £300k now? Even £300k per year for the next 10 years is only half of what his shares will be worth if he keeps the company going strong.

Fair point, but thinking about how the company seems to be behaving (with everything aimed at the short term), and the Hobbit Bubble likely to burst in about 4-5 years time, I can see Kirby retiring perhaps a year before that happens, a millionaire many times over but leaving the company in an extremely perilous position.

And GW would then face a shareholder derivative action (with some steam behind it) based on Kirby and other directors violating their fiduciary duties of care and loyalty. Stranger83 has it right, directors and employee officers having a large stake in the company is one of the best ways to ensure that the company ISN'T run into the ground, because they stand to lose the most.

Not if they sell out right before it crashes and burns.

 jonolikespie wrote:

 G. Whitenbeard wrote:

 Pacific wrote:

Stranger83 wrote:

And finally For those saying Mr Kirby is doing this to line his own pocket – I think that’s a little unfair. No doubt you would all be saying he was in the wrong if he had no shares in GW as he would have no incentive to run the company better, as one of the major shareholders it’s in his interest to run the company well, and for this reason I’m glad he has so many shares. Lets not forget that if he really was just trying to extract money from GW (in this case around £300k) and ran the company into the ground the share price would crash, making his (currently valued at) £6m worth of shares next to worthless – ask yourself the question, would you give up £6m in 5-10 years time (when I presume he’ll be looking to retire) for £300k now? Even £300k per year for the next 10 years is only half of what his shares will be worth if he keeps the company going strong.

Fair point, but thinking about how the company seems to be behaving (with everything aimed at the short term), and the Hobbit Bubble likely to burst in about 4-5 years time, I can see Kirby retiring perhaps a year before that happens, a millionaire many times over but leaving the company in an extremely perilous position.

And GW would then face a shareholder derivative action (with some steam behind it) based on Kirby and other directors violating their fiduciary duties of care and loyalty. Stranger83 has it right, directors and employee officers having a large stake in the company is one of the best ways to ensure that the company ISN'T run into the ground, because they stand to lose the most.

Not if they sell out right before it crashes and burns.

In America, that would be immediately followed up by an SEC 10(b)(5) action against the offending executives/directors for fraudulent market actions/insider trading etc...

Whether through a derivative corporate suit against the individual or through Federal action, it's nearly impossible to "dump and run" like in the old days without getting caught.

Stop bringing logic into this.

The point is Kirby is timing the crash so its just after he retires....
He is doing just enough to keep GW plc afloat, and paying good dividends (nearly doubling his £ 400 K salery each year.)

He is focusing entirely on short term profit, why should he care about the long term future of the company when he is this close to retiring?.

So Lanak is psychic now as well as a business guru.

You really are wasted here mate.

It wouldn't be the first time he's (Kirby) done this.

 notprop wrote:
So Lanak is psychic now as well as a business guru.

You really are wasted here mate.

To the man, ey?

Sorry fella I've left my tinfoil decoder hat at home so you'll have to explain.

What has kirby (him) done before exactly?

No. I can’t be bothered dealing with you.

Ah so you have nothing but an overused emoticon. Impressive!

Clearly my 'to the man' comment wooshed right over your head.

Are you sure you appear to be the one spinning in circles?

I just wanted to see if there was actually something your first statement. You know discussion rather than the usual tired conjecture and it would appear insinuation.

Boo someone doesn't pander immediately to my opinion, ergo I dub thee white knight. Have I missed something then?

HBMC has a problem with shareholders running a business for profit.

 Testify wrote:
HBMC has a problem with shareholders running a business for profit.

http://theback40k.blogspot.com/2012/11/the-vice-thats-squeezing-gw.html#more


Decent article. Oh and as an investor in the legalize gambling the stock market I certainly would not invest in GW at the moment. I get a better return and the confidence in investing into a major gaming company such as Hasbro. Now if Fantasy Flight Games opened up for funding, I'd invest into it in a heart beat as they have a good business model currently.

 Adam LongWalker wrote:

 Testify wrote:
HBMC has a problem with shareholders running a business for profit.

http://theback40k.blogspot.com/2012/11/the-vice-thats-squeezing-gw.html#more


Decent article. Oh and as an investor in the legalize gambling the stock market I certainly would not invest in GW at the moment. I get a better return and the confidence in investing into a major gaming company such as Hasbro. Now if Fantasy Flight Games opened up for funding, I'd invest into it in a heart beat as they have a good business model currently.

You know GW outperformed the S&P500 by over a 4 to 1 ratio over the last year as oppose to Hasbro which was essentially flat over the last year? I have owned some shares for the last year and it is the best performing stock I have and beat all the index funds (S&P500, NASDAQ, Wilshire 2000) quite handily. Though my continued holding of them relies on how the Hobbit does.

silent25 wrote:
You know GW outperformed the S&P500 by over a 4 to 1 ratio over the last year as oppose to Hasbro which was essentially flat over the last year? I have owned some shares for the last year and it is the best performing stock I have and beat all the index funds (S&P500, NASDAQ, Wilshire 2000) quite handily. Though my continued holding of them relies on how the Hobbit does.

Tom Kirby's primary and only goal is to squeeze as much money out of GW into his private coffers via dividends. No wonder that GW is better at paying divdends than at marketing, quality control, raising sales and customer numbers etc.

silent25 wrote:

 Adam LongWalker wrote:

 Testify wrote:
HBMC has a problem with shareholders running a business for profit.

http://theback40k.blogspot.com/2012/11/the-vice-thats-squeezing-gw.html#more


Decent article. Oh and as an investor in the legalize gambling the stock market I certainly would not invest in GW at the moment. I get a better return and the confidence in investing into a major gaming company such as Hasbro. Now if Fantasy Flight Games opened up for funding, I'd invest into it in a heart beat as they have a good business model currently.

You know GW outperformed the S&P500 by over a 4 to 1 ratio over the last year as oppose to Hasbro which was essentially flat over the last year? I have owned some shares for the last year and it is the best performing stock I have and beat all the index funds (S&P500, NASDAQ, Wilshire 2000) quite handily. Though my continued holding of them relies on how the Hobbit does.

 Kroothawk wrote:

silent25 wrote:
You know GW outperformed the S&P500 by over a 4 to 1 ratio over the last year as oppose to Hasbro which was essentially flat over the last year? I have owned some shares for the last year and it is the best performing stock I have and beat all the index funds (S&P500, NASDAQ, Wilshire 2000) quite handily. Though my continued holding of them relies on how the Hobbit does.

Tom Kirby's primary and only goal is to squeeze as much money out of GW into his private coffers via dividends. No wonder that GW is better at paying divdends than at marketing, quality control, raising sales and customer numbers etc.

All shareholders want a quick buck, especially in small companies.

 Adam LongWalker wrote:

silent25 wrote:

 Adam LongWalker wrote:

 Testify wrote:
HBMC has a problem with shareholders running a business for profit.

http://theback40k.blogspot.com/2012/11/the-vice-thats-squeezing-gw.html#more


Decent article. Oh and as an investor in the legalize gambling the stock market I certainly would not invest in GW at the moment. I get a better return and the confidence in investing into a major gaming company such as Hasbro. Now if Fantasy Flight Games opened up for funding, I'd invest into it in a heart beat as they have a good business model currently.

You know GW outperformed the S&P500 by over a 4 to 1 ratio over the last year as oppose to Hasbro which was essentially flat over the last year? I have owned some shares for the last year and it is the best performing stock I have and beat all the index funds (S&P500, NASDAQ, Wilshire 2000) quite handily. Though my continued holding of them relies on how the Hobbit does.

There are two ways in answering this. The first way is to ask what is your investment mindset. If you are young enough (20's to 30's) you can go ahead and take chances with a company such as GW. If you are in the right place at the right time, you will be fine.

I'm an old man so my mindset is to have a stable return rate that is ahead of the inflation rate on a year to year basis.

I used Hasbro because of this. I like the yearly growth that it has,

http://finance.yahoo.com/echarts?s=HAS+Interactive#symbol=has;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

Compared to GW's

http://finance.yahoo.com/echarts?s=GAW.L+Interactive#symbol=gaw.l;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

GW is way too up and down for my tastes.

As I have posted previously, I'm into real estate. Both Commercial and Residential within the Western parts of the US. My portfolio is roughly 60% invested into property which I get a overall return of 8% profits per year. 25% in good old hard cash and 15% which consists of mostly Tax sheltered annuities, then federal and/or state exempt bonds. Because of my health and age I am actually consolidating my holdings and to those people who have been good to me (as well as my pets) will be taken care of financially when I am gone.

The Second way of dealing with your comment is a phrase that came from a person who stated.

GW shops in America only live as long as their lease.

This is a very true analogy on how part their business model works in the US. In my case this practice as well as the Data collected over the years, the conversations with current/ former employees as well as stock holders are another reason why I do not invest into that company. I do my research on everything that I can get before making an investment.

And in my case I would invest into a company such as Hasbro over GW.

But of course your mileage may vary

Hasbro are about 10 times as big as GW. You may as well compare them to BP.

 Adam LongWalker wrote:


There are two ways in answering this. The first way is to ask what is your investment mindset. If you are young enough (20's to 30's) you can go ahead and take chances with a company such as GW. If you are in the right place at the right time, you will be fine.

I'm an old man so my mindset is to have a stable return rate that is ahead of the inflation rate on a year to year basis.

I used Hasbro because of this. I like the yearly growth that it has,

http://finance.yahoo.com/echarts?s=HAS+Interactive#symbol=has;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

Compared to GW's

http://finance.yahoo.com/echarts?s=GAW.L+Interactive#symbol=gaw.l;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

GW is way too up and down for my tastes.

As I have posted previously, I'm into real estate. Both Commercial and Residential within the Western parts of the US. My portfolio is roughly 60% invested into property which I get a overall return of 8% profits per year. 25% in good old hard cash and 15% which consists of mostly Tax sheltered annuities, then federal and/or state exempt bonds. Because of my health and age I am actually consolidating my holdings and to those people who have been good to me (as well as my pets) will be taken care of financially when I am gone.

The Second way of dealing with your comment is a phrase that came from a person who stated.

GW shops in America only live as long as their lease.

This is a very true analogy on how part their business model works in the US. In my case this practice as well as the Data collected over the years, the conversations with current/ former employees as well as stock holders are another reason why I do not invest into that company. I do my research on everything that I can get before making an investment.

And in my case I would invest into a company such as Hasbro over GW.

But of course your mileage may vary

Yes, GW has had some drops and the major one being the post LotR bust. Hence my comment on my continued holding depends on the performance of the movie. This is a short term gamble based on anticipated revenue from the movie tie in. Those charts are misleading. If you compare the performance of Hasbro vs GW during GW's publicly traded existence, GW has almost always outperformed Hasbro during that period.

As for the magenta quote, how is that any different from any major corporation? Is that any more horrible than companies that set up shops in states only as long as tax breaks offered exclusively to them exist? Walmart is infamous for that and worse, but I bet you would love to have invested in them back in the 80's (in case you didn't).

The data is the data and again my mindset is different that yours. You invested in GW. I certainly did not. Good luck with your investment.

As far as the rest of your comment. I do not see Games Workshop as a tier 1 corporation. They are a niche company that have illusions of believing that they are something that they are not. From a business stand point though I can see where you are coming from as everyone tries to not to give the tax man any more coin that they have too.

There is a lot I do want to say, but I do not want to derail from the topic.

Suffice to say we agree to disagree on certain things and keep it as that.

I think it's funny that people are trying to compare GW's prices now to the prices in 2008, especially since the price hikes just 7 short months ago had increases of 17% and higher on items. It's not surprising at all that GW paid out dividends this year when they're selling the same models/codices they were last year at a 17% increase (some higher, some lower).

The prices were the main reason that I left 'the Hobby'. And the sort of money I spent on GW products could not be easily replaced with 1 or 2 new gamers. The other reason was Finecast, but no need to go into that, since I'm sure they've improved it with their cash surplus.

Lanrak wrote:
The point is Kirby is timing the crash so its just after he retires....
He is doing just enough to keep GW plc afloat, and paying good dividends (nearly doubling his £ 400 K salery each year.)

He is focusing entirely on short term profit, why should he care about the long term future of the company when he is this close to retiring?.

Wow, he works quick – a couple of pages ago he was just after a quick buck now – now he is timing it for after he retires. By the way if he is able to time the crash of the GW stock for just after he retires then he is a business genius as plenty have tried this in the past and very few succeed. Secondly this is illegal and if he did cash in and then walk away with is crashing I have no doubt he would have some very difficult questions to answer. A period in prison and your assests seized hardly make this seem worthwhile. Lets add that under Kirby the average dividend for GW has gone down (so I’m lead to believe) and I really don't get your point.

If he is “milking the company for the dividend now” then frankly he is being very silly – he could sell his stock and buy any one of hundreds of other companies who have a lower share price and pay a larger dividend granting him more cash.

If he is “Cashing in a little now whilst waiting to retire and then wreck the company” they he is gambling a lot of cash on a not very large (relative to what he has invested and what he stands to gain) payment. And again he could just as easily make the same money at another company without the potential legal complications of doing this.

 Kroothawk wrote:

silent25 wrote:
You know GW outperformed the S&P500 by over a 4 to 1 ratio over the last year as oppose to Hasbro which was essentially flat over the last year? I have owned some shares for the last year and it is the best performing stock I have and beat all the index funds (S&P500, NASDAQ, Wilshire 2000) quite handily. Though my continued holding of them relies on how the Hobbit does.

Tom Kirby's primary and only goal is to squeeze as much money out of GW into his private coffers via dividends. No wonder that GW is better at paying divdends than at marketing, quality control, raising sales and customer numbers etc.

Upon why actual data are you basing this? Have you met him? Had any conversation with him? Seen his business or personal plans? What business data are you basing this on? If, as I presume it’s falling sale numbers I again point out that we are in a recession and GW is a luxuary item you only need to buy once. You might be tempted to finish a hobby that you have already started in a recession, but few people are prepared to start a new hobby. Even supermarkets that have traded for years are making their first ever loss this year – it’s hardly surpriseing that GW has falling sales.

Whilst I do not agree with everything Kirby does your quote that his sole aim is to maximise cash for himself has no basis in fact, indeed if he didn't pay a dividend then that would probably provoke the crash that you are predicting he wants. Also see above for my comment how how he could really maximise his cash return.

 Adam LongWalker wrote:



There are two ways in answering this. The first way is to ask what is your investment mindset. If you are young enough (20's to 30's) you can go ahead and take chances with a company such as GW. If you are in the right place at the right time, you will be fine.

I'm an old man so my mindset is to have a stable return rate that is ahead of the inflation rate on a year to year basis.

I used Hasbro because of this. I like the yearly growth that it has,

http://finance.yahoo.com/echarts?s=HAS+Interactive#symbol=has;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

Compared to GW's

http://finance.yahoo.com/echarts?s=GAW.L+Interactive#symbol=gaw.l;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

GW is way too up and down for my tastes.

As I have posted previously, I'm into real estate. Both Commercial and Residential within the Western parts of the US. My portfolio is roughly 60% invested into property which I get a overall return of 8% profits per year. 25% in good old hard cash and 15% which consists of mostly Tax sheltered annuities, then federal and/or state exempt bonds. Because of my health and age I am actually consolidating my holdings and to those people who have been good to me (as well as my pets) will be taken care of financially when I am gone.

The Second way of dealing with your comment is a phrase that came from a person who stated.

GW shops in America only live as long as their lease.

This is a very true analogy on how part their business model works in the US. In my case this practice as well as the Data collected over the years, the conversations with current/ former employees as well as stock holders are another reason why I do not invest into that company. I do my research on everything that I can get before making an investment.

And in my case I would invest into a company such as Hasbro over GW.

But of course your mileage may vary

A reasonable argument, and I can see your point. I invest in GW partly for a return, but am fortunate enough that a few years ago I can up with a £3m idea and don't really need the cash too much. I got 10,000 shares in GW (and a similar number in other companies) either because I think what they are doing is for the benefit of mankind or because it's something I enjoy and wanted to "give back". It also helps a little that I am only 29 and can afford a little fluctuation in the prices for now.

However, I am sure you will agree, as a shareholder yourself, that their is a big difference between paying a dividend and running the business into the ground for your own personal profit.

I think it more likely Kirby will fill his pockets in dividends whilst cutting costs to the bones (margins have already increased and new design philosophy will increase this) and price jacking which we have seen the first of the new pricing structure with the hobbit. Once share prices and dividends are at the maximum he can drive we will probably see the business sold to an aggressive hedge fund which will wring cash out of it till it dies and sell its assets off.

This way Kirby lines his pockets, he gets away scot free and the customer suffers as always.

UNCLEBADTOUCH wrote:
I think it more likely Kirby will fill his pockets in dividends whilst cutting costs to the bones (margins have already increased and new design philosophy will increase this) and price jacking which we have seen the first of the new pricing structure with the hobbit. Once share prices and dividends are at the maximum he can drive we will probably see the business sold to an aggressive hedge fund which will wring cash out of it till it dies and sell its assets off.

This way Kirby lines his pockets, he gets away scot free and the customer suffers as always.

This is a possibility I grant, but no more so than any other company. Lets not forget that Kirby can try to sell the company to someone else all he wants, ultimately it is the shareholders who get the final say and currently they are very happy with GW due to rising share prices and a steady, if not massive dividend payment, so if anything if this was his plan then he would be stopping the dividend so that shareholders want to sell their stock and he can buy it up himself – paying out a dividend and keeping the shareholders happy is not the way to incurage them to sell their stock to another company.

Kirby owns less then 10% of the company, as such he only get a 1 in 10 say if it can be sold on, one point that I haven’t raised in all this is the fact that if as he was coming up to retirement he started doing practises that indicated he was going to maximise his own cash and “cash in” before causing a crash the shareholders would vote him out in a flash. The major shareholders are pension funds and such who do nothing but monitor their investments for dodgy dealing and I have no doubt they would pick up on anything untoward.

I think that at the end of the hobbit bubble there may be a few traders willing to get out while GW stock is high, and they don't need everyone willing to sell just enough to force a buy out.

Dividends would have to be paid up to that period to keep Kirby in charge and to line his nest.

This would be the worst result for GW customers, I can just as likely see Kirby retire the business does nothing radical and slowly dwindles away to a shadow of its former self.

Maybe their is a clever way to fund a community buy out via kickstarter? Who knows, plus no guarantee you wouldn't end up with a muppet in charge anyway lol

UNCLEBADTOUCH wrote:
I think that at the end of the hobbit bubble there may be a few traders willing to get out while GW stock is high, and they don't need everyone willing to sell just enough to force a buyout.

Dividends would have to be paid up to that period to keep Kirby in charge and to line his nest.

True, I also expect a few traders to pull out when the hobbit bubble bursts, but lets not forget that the big 3 share holders own 46% of the business. Any takeover would thus pretty much need the agreement of all 3 of these, so any other investors pulling out isn’t really going to make too much difference. Unless you are implying one of the big three pulls out completely (or mostly) – but I only see that happening if there is a major catastrophe and in that situation a buyout might be best anyway.

I’m also fairly confident from what I have been told about the way that they are handling the Hobbit this time around that they have learnt their lessons from the LOTR game and are fully prepared for the bubble to burst and aren’t expecting people to play The Hobbit then start on Warhammer/40k (which was one of the major expectations of LOTR)

UNCLEBADTOUCH wrote:
I can just as likely see Kirby retire the business does nothing radical and slowly dwindles away to a shadow of its former self.

Maybe their is a clever way to fund a community buy out via kickstarter? Who knows, plus no guarantee you wouldn't end up with a muppet in charge anyway lol

This is a possibility with any company however – everyone has to run with the times or get left behind. Besides which if this did happen it would not be caused by “Kirby lining his pockets” or dividends being paid.

I did consider setting up a hedge fund via kickstarter at one point, but then realised that I wouldn’t have anything tangible to give to investors as a reward. Like it or not Kickstarter has stopped being an “invest in my idea” place and is really just a shop to pre-order stuff.

UNCLEBADTOUCH wrote:
I think that at the end of the hobbit bubble there may be a few traders willing to get out while GW stock is high, and they don't need everyone willing to sell just enough to force a buy out.

Dividends would have to be paid up to that period to keep Kirby in charge and to line his nest.

This would be the worst result for GW customers, I can just as likely see Kirby retire the business does nothing radical and slowly dwindles away to a shadow of its former self.

Maybe their is a clever way to fund a community buy out via kickstarter? Who knows, plus no guarantee you wouldn't end up with a muppet in charge anyway lol

Tom Kirby was a rich man when he took GW pubic more than a decade ago, I would imagine that his many nest are more than lined at this point.

I'm not sure why you expect Kirby retiring to be the be all and end all? If GW are as diabolical at business as all the experts here imagine then his going can surely only be a good thing?

Anyone taking up the reigns at that point will have a point to prove and look to reinvigorate the company certainly if it is on a downturn. Now if GW has been run into the ground the new head will naturally be the one that identifies this illegal behaviour - reason enough for Kirby not to do it if the scrutiny from existing pension fund owners did not already detect this supposed behaviour.

The main issue I have with the dividends is that a lot o it is coming at the expense of reduced quality, a lot of design is being compromised to reduce sprue count and cut costs. If this was done to help freeze pricing (they're never actually going to cut prices after all) then this would be fine in my opinion. when it's done alongside rising prices to fund a dividend then I find it somewhat objectionable.

Reduce service, reduce quality, increase price.

That is not a model I'm fond of. Though I seems to be GWs mantra of late.


Automatically Appended Next Post:
@notprop when Kirby retires your assuming that GW can attract a good replacement. With so much rigid infrastructure in place with licensing, commercial properties, manufacturing et al it would be immensely difficult for someone to come in and refresh the company. GW is like an oil tanker, it may be the biggest boat in the pond but it takes ages to turn and may run aground before it makes it. There are lots of vibrant, flexible upcoming business which would be very attractive to someone who actually wants to make a mark in the industry.

Money talks, you intimate that Kirby is reaping it in. Why wouldn't A.N.other be attracted to do the same?

I don't think that GW would struggle to attract a new CEO of quality. They are one of those stand out businesses - a British Manufacturing success that will attract people even if they see it as an easy ride.

And way are dividends reducing quality? That's a massive stretch.

A poor launch of Finecast aside i'm not seeing a downturn in quality of product. The toy like nature of some of the big kits while not my cup of tea isn't a reduction in quality.

UNCLEBADTOUCH wrote:
The main issue I have with the dividends is that a lot o it is coming at the expense of reduced quality, a lot of design is being compromised to reduce sprue count and cut costs. If this was done to help freeze pricing (they're never actually going to cut prices after all) then this would be fine in my opinion. when it's done alongside rising prices to fund a dividend then I find it somewhat objectionable.

Reduce service, reduce quality, increase price.

That is not a model I'm fond of. Though I seems to be GWs mantra of late.


Automatically Appended Next Post:
@notprop when Kirby retires your assuming that GW can attract a good replacement. With so much rigid infrastructure in place with licensing, commercial properties, manufacturing et al it would be immensely difficult for someone to come in and refresh the company. GW is like an oil tanker, it may be the biggest boat in the pond but it takes ages to turn and may run aground before it makes it. There are lots of vibrant, flexible upcoming business which would be very attractive to someone who actually wants to make a mark in the industry.

Whilst I agree that the quality of Finecast is very bad I think the quality of the actual design of the models has vastly improved of late, but that is just a personal choice – the models are more in the style I “like” Though I do think (hope) that you will agree that – miscasts aside – the detail on the models is much improved, even if you don’t like the newer designs.

I fully agree GW has shot themselves in the foot with Finecast and would be best suited admitting they got it wrong and finding another type of resin, but I’m not privy to the deal they have with the makers of Finecast and the cost of pulling out and switching to someone else may be prohibitive. As a point of interest, I read somewhere that part of the rising model cost is due to the fact that they have so many unusable castings with Finecast that they are literally throwing away the savings on metal, have no idea if this is true - it was just something I read.

Yes prices have risen, and the quality of the material of the product has fallen, but the quality of the design has – I believe – improved, also the dividend has fallen so although prices have risen the shareholders are getting less than they were before – therefore the argument that the rising prices are going to fund shareholders is incorrect.

Shock horror I'm not referring to finecast lol we all know the failings there so wasn't referring to that. In a lot if the new plastics you can see where detail has been smudged and the model deformed so that it can be in less pieces, hobbit goblins are a prime example they lack necks and ears are blended into shoulders. Also some kits have been oversimplified an example being the wall if martyrs, it would have been exceptionally easy to provide attachable detail panels however they chose to fudge it to save material and number if sprues. These are examples of reduction in quality for the sake of cost cutting which isn't passed onto the consumer.


Automatically Appended Next Post:
@notprop GW is not high enough profile for a top level CEO if they throw big bucks at it they will only attract fat bloated old CEOs on there way out to retirement that just want an easy pay check like they currently have rather than attracting someone who will actively drive the company forwards.

I don't think GW is being run into the ground.

The evidence of the past decade is that the LoTR boom led to them getting fat and lazy, as they admitted.

They needed to rationalise the business, which they have done by getting rid of Bitz, improving the way retail is organised, EPOS, more web sales, and so on.

The effects have been shown in their improving financial results in the past couple of years.

I do think they may have a long term problem if they piss off enough veterans, assuming that veterans are important to the recruitment of new young customers. That may be a false assumption, though.

However, while I believe they have been suffering a long term decline of customers, we can't be sure that is caused by the pissed off vet situation, or that it will continue.

UNCLEBADTOUCH wrote:
Shock horror I'm not referring to finecast lol we all know the failings there so wasn't referring to that. In a lot if the new plastics you can see where detail has been smudged and the model deformed so that it can be in less pieces, hobbit goblins are a prime example they lack necks and ears are blended into shoulders. Also some kits have been oversimplified an example being the wall if martyrs, it would have been exceptionally easy to provide attachable detail panels however they chose to fudge it to save material and number if sprues. These are examples of reduction in quality for the sake of cost cutting which isn't passed onto the consumer.

What GW could have done is made a wall entirely made of bodies. Imagine Cadians and skulls stacked up like Legos. That would be a proper wall of Martyrs (GW Style).

I think the current version is fine, what else do you want with sections of wall? The dead bodies they have show what the damned thing it fits it's name.

As for the Hobbit Sprues. Meh. It has happened in the past and will happen again, and is not just GW guilty of it.

The bodies should be separate as it would allow non-IG players more versatility for using it instead if doing it on the cheap and limiting its appeal.

When it comes to blurring models to fit moulds, it's fine if you charge mantic prices but not what GW charges. They claim to be the Ferrari of the miniature world and charge accordingly, I think it's time they revised that opinion of themselves.

UNCLEBADTOUCH wrote:
Shock horror I'm not referring to finecast lol we all know the failings there so wasn't referring to that. In a lot if the new plastics you can see where detail has been smudged and the model deformed so that it can be in less pieces, hobbit goblins are a prime example they lack necks and ears are blended into shoulders. Also some kits have been oversimplified an example being the wall if martyrs, it would have been exceptionally easy to provide attachable detail panels however they chose to fudge it to save material and number if sprues. These are examples of reduction in quality for the sake of cost cutting which isn't passed onto the consumer.

Fair enough, you are entitled to your opinion.

Out of interest, do you think that these failures in the mini have gotten worse in the past few years or remained steady - as if they have remained steady then it's nothing new and can hardly be blamed on the shareholders dividends.

I do question the point about cutting costs and not passing it onto the customer though - (N.B. all figures I'm about to quote are made up and I have no idea if they are true) Presuming GW have cost increases of 20% due to increase wages/electricity bills/business rates/cost of raw materials and they decide to simplify a model and increase it's cost by 10% then, this is a saving for the customer - it just doesn't look like it.

We do seem to be getting a little off track anyway as I have already pointed out that shareholder dividends have gone down recently to what it used to be, so they certainly are not cashing in on any real or preceived drop in quality - and this thread is supposed to be about if the Dividend is justified or not.

In answer to your question i think plastic quality peaked DE/Necron releases and has been decreasing since.


Automatically Appended Next Post:
In answer to your question i think plastic quality peaked DE/Necron releases and has been decreasing since.

UNCLEBADTOUCH wrote:
The bodies should be separate as it would allow non-IG players more versatility for using it instead if doing it on the cheap and limiting its appeal.

When it comes to blurring models to fit moulds, it's fine if you charge mantic prices but not what GW charges. They claim to be the Ferrari of the miniature world and charge accordingly, I think it's time they revised that opinion of themselves.

I would agree that being the best in the business and blurring models isn't quite right. But there are conversion opportunities. Sometimes we get spoilt a little too much. Not that I have had much need for GW related products over the last 5-10 years.

 Adam LongWalker wrote:

silent25 wrote:

 Adam LongWalker wrote:

 Testify wrote:
HBMC has a problem with shareholders running a business for profit.

http://theback40k.blogspot.com/2012/11/the-vice-thats-squeezing-gw.html#more


Decent article. Oh and as an investor in the legalize gambling the stock market I certainly would not invest in GW at the moment. I get a better return and the confidence in investing into a major gaming company such as Hasbro. Now if Fantasy Flight Games opened up for funding, I'd invest into it in a heart beat as they have a good business model currently.

You know GW outperformed the S&P500 by over a 4 to 1 ratio over the last year as oppose to Hasbro which was essentially flat over the last year? I have owned some shares for the last year and it is the best performing stock I have and beat all the index funds (S&P500, NASDAQ, Wilshire 2000) quite handily. Though my continued holding of them relies on how the Hobbit does.

There are two ways in answering this. The first way is to ask what is your investment mindset. If you are young enough (20's to 30's) you can go ahead and take chances with a company such as GW. If you are in the right place at the right time, you will be fine.

I'm an old man so my mindset is to have a stable return rate that is ahead of the inflation rate on a year to year basis.

I used Hasbro because of this. I like the yearly growth that it has,

http://finance.yahoo.com/echarts?s=HAS+Interactive#symbol=has;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

Compared to GW's

http://finance.yahoo.com/echarts?s=GAW.L+Interactive#symbol=gaw.l;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

GW is way too up and down for my tastes.

As I have posted previously, I'm into real estate. Both Commercial and Residential within the Western parts of the US. My portfolio is roughly 60% invested into property which I get a overall return of 8% profits per year. 25% in good old hard cash and 15% which consists of mostly Tax sheltered annuities, then federal and/or state exempt bonds. Because of my health and age I am actually consolidating my holdings and to those people who have been good to me (as well as my pets) will be taken care of financially when I am gone.

The Second way of dealing with your comment is a phrase that came from a person who stated.

GW shops in America only live as long as their lease.

This is a very true analogy on how part their business model works in the US. In my case this practice as well as the Data collected over the years, the conversations with current/ former employees as well as stock holders are another reason why I do not invest into that company. I do my research on everything that I can get before making an investment.

And in my case I would invest into a company such as Hasbro over GW.

But of course your mileage may vary

Now look at the links over 5 years rather than since 1984 - Hasbro has flatlined - GW not so much - presumably these charts assume that dividends are reinvested - I couldn't check.

http://finance.yahoo.com/echarts?s=HAS+Interactive#symbol=has;range=5y;compare=gaw.l;indicator=volume;charttype=area;crosshair=on;ohlcvalues=1;logscale=on;source=undefined;

 RFHolloway wrote:

 Adam LongWalker wrote:

silent25 wrote:

 Adam LongWalker wrote:

 Testify wrote:
HBMC has a problem with shareholders running a business for profit.

http://theback40k.blogspot.com/2012/11/the-vice-thats-squeezing-gw.html#more


Decent article. Oh and as an investor in the legalize gambling the stock market I certainly would not invest in GW at the moment. I get a better return and the confidence in investing into a major gaming company such as Hasbro. Now if Fantasy Flight Games opened up for funding, I'd invest into it in a heart beat as they have a good business model currently.

You know GW outperformed the S&P500 by over a 4 to 1 ratio over the last year as oppose to Hasbro which was essentially flat over the last year? I have owned some shares for the last year and it is the best performing stock I have and beat all the index funds (S&P500, NASDAQ, Wilshire 2000) quite handily. Though my continued holding of them relies on how the Hobbit does.

There are two ways in answering this. The first way is to ask what is your investment mindset. If you are young enough (20's to 30's) you can go ahead and take chances with a company such as GW. If you are in the right place at the right time, you will be fine.

I'm an old man so my mindset is to have a stable return rate that is ahead of the inflation rate on a year to year basis.

I used Hasbro because of this. I like the yearly growth that it has,

http://finance.yahoo.com/echarts?s=HAS+Interactive#symbol=has;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

Compared to GW's

http://finance.yahoo.com/echarts?s=GAW.L+Interactive#symbol=gaw.l;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

GW is way too up and down for my tastes.

As I have posted previously, I'm into real estate. Both Commercial and Residential within the Western parts of the US. My portfolio is roughly 60% invested into property which I get a overall return of 8% profits per year. 25% in good old hard cash and 15% which consists of mostly Tax sheltered annuities, then federal and/or state exempt bonds. Because of my health and age I am actually consolidating my holdings and to those people who have been good to me (as well as my pets) will be taken care of financially when I am gone.

The Second way of dealing with your comment is a phrase that came from a person who stated.

GW shops in America only live as long as their lease.

This is a very true analogy on how part their business model works in the US. In my case this practice as well as the Data collected over the years, the conversations with current/ former employees as well as stock holders are another reason why I do not invest into that company. I do my research on everything that I can get before making an investment.

And in my case I would invest into a company such as Hasbro over GW.

But of course your mileage may vary

Now look at the links over 5 years rather than since 1984 - Hasbro has flatlined - GW not so much - presumably these charts assume that dividends are reinvested - I couldn't check.

http://finance.yahoo.com/echarts?s=HAS+Interactive#symbol=has;range=5y;compare=gaw.l;indicator=volume;charttype=area;crosshair=on;ohlcvalues=1;logscale=on;source=undefined;

You're comparing stock price so this would not assume dividends are reinvested.


Automatically Appended Next Post:

 htj wrote:

It's funny, I've worked for a fair few retail chains, and never one that pays dividends without profit. Actually, wait, scratch that - I worked for GW for a while, so I guess I did.

...

What R&D do you think GW are missing out on? The rules are constantly being changed, and modelling processes upgraded and altered, do you not think that this fills the role of necessary R&D to keep the market fresh?

Hopefully I got the quotes right...

Making a profit and having cash on hand do not have to coincide with each other. Most public companies have the expectation that dividends will be paid and if you're not paying dividends at your usual rate, something must be wrong. If GW never paid dividends, the expectation wouldn't be there and not paying them would be the norm. But to institutional investors, if the Company is making a profit and traditionally pays constant dividends, not paying a dividend would indicate a potential problem. They would need to be issuing a press release or something that would indicate their need to not pay the dividend and what their plans are going to be and why its better to reinvest in the Company because they are going to do X, Y, and Z with the money instead of pay it as a dividend. As an investor, if they are not going to pay me dividends, I want to know what growth initiatives they are working on. Why should I let you reinvest my earnings, why would you do a better job of managing that money than me? If you plan on changing course and don't want to tell everyone your release schedule some 2-3 years out which can hurt your sales. GW has made a healthy profit for the last several years - paying a dividend shouldn't be unexpected especially since they are one of the few companies thats still around making a game you obviously enjoy (otherwise you wouldn't be on the site).

I agree with you - they've paid dividends, still put out new models, and new editions for all 3 core games.

 Testify wrote:
HBMC has a problem with shareholders running a business for profit.

Except that that's not true and anyone with half a God-damned brain knows that that's not true.

 H.B.M.C. wrote:

 Testify wrote:
HBMC has a problem with shareholders running a business for profit.

Except that that's not true and anyone with half a God-damned brain knows that that's not true.

I don't see why anyone with a God-damned brain would know your opinion on something. You clearly don't think businesses should pay dividends, I don't see what else there is for you to say on the subject.

If a company is paying dividends because it is growing the buisness, improving products and the demand for the products.NO PROBLEM.
Restructuring the buisness to make it more efficient , and sustanable long term, is also grounds for paying dividends.

However, wallet raping customers to the point they leave in droves , so the company chairman can pocket another £300K in dividends before he retires, may be seen as short sighted money grabbing of the worst order.

Just sayin'

To be fair, you don't know that customers are leaving in droves. Or rather, that the net loss of customers is high. They probably do lose a lot of customers but the constantly gain them which means they have a high turnover in customers. Which is perfectly ok in a business as long as the money keeps coming.

Lanrak wrote:
If a company is paying dividends because it is growing the buisness, improving products and the demand for the products.NO PROBLEM.
Restructuring the buisness to make it more efficient , and sustanable long term, is also grounds for paying dividends.

However, wallet raping customers to the point they leave in droves , so the company chairman can pocket another £300K in dividends before he retires, may be seen as short sighted money grabbing of the worst order.

Just sayin'

Again, we have no idea if GW customers are falling, we do know that their sales have fallen but since profits are going up pretty much every year that would indicate a steady customer base with people just spreading the purchase of their armies over a longer period.

I do actually probably agree that the customer base has fallen, but personally I doubt it'll be as big as most people on here think.

We can compare the rate of increase of prices with the rate of increase of revenues.

This comparison suggests that revenues are being maintained or increased by selling fewer kits at higher prices.

That might be because customer numbers are increasing but each customer is buying fewer kits. It might be that customers are buying as many kits but there are fewer customers. There is no real way to tell.

 htj wrote:

 H.B.M.C. wrote:
A dividend doesn't mean they're 'going strong'. All it means is that they paid a dividend. They've borrowed money in the past to do that.

They have? This is not something I'd heard of happening. Seems like a great way to collapse into debt. Oh well, so much for optimism.

Costco just did the same thing ahead of the new tax rates, borrowed to pay a larger dividend.

http://online.wsj.com/article/SB10001424127887324705104578149012514177372.html?mod=googlenews_wsj

 Kilkrazy wrote:
We can compare the rate of increase of prices with the rate of increase of revenues.

No we can't. We can compare average price increase of their catalogue to their revenue increase, but since we do not know anything about respective sales volumes, such comparison tells us almost nothing. Pretty much all we can do is to rule out most extreme propositions (big growth/huge collapse).

Well, we know that revenue (inflation-adjusted at least) is nearly flat for several years.
We know that all introductory product prices (starter boxes, rulebooks, Codices, standard troops) were massively increased for several years until 2011.
We know that all character and elite troop prices were massively increased when recast in Finecast. Also all batallion boxes this year.
We know that Hobbit product prices are massively increased relatively to LOTR prices.
Any prices left not massively increased in the last few years?

 Kroothawk wrote:
Well, we know that revenue (inflation-adjusted at least) is nearly flat for several years.
We know that all introductory product prices (starter boxes, rulebooks, Codices, standard troops) were massively increased for several years until 2011.
We know that all character and elite troop prices were massively increased when recast in Finecast. Also all batallion boxes this year.
We know that Hobbit product prices are massively increased relatively to LOTR prices.
Any prices left not massively increased in the last few years?

Yes we know these things, but a flat revenue stream and decreased sales doesn't automatically mean a fallen customer base. Lets face it, wargaming is a finite hobby for most people, once you have your army there is very little incentive to buy more stuff. Now if you used to spend, let say £500 a year on models you would get your army in 2 years - now, keeping the same spend going, it takes you 3.5 years. You still buy the same amount of stuff as you always would have done, your still a customer - infact they can class you as a customer for longer as you would previously have stopped being a customer after 2 years and now you are a customer for 3.5.

I'm not saying that price increases havn't happened, I'm not saying that some people havn't fallen out with the company, I'm not even saying that the customer base hasn't fallen slightly due to the price rises, what I dispute is this idea that GW is putting up prices and losing "all" their customers, that is going to drive them into a collapse that Kirby is so desperately desiring for his own personal profit.

What is far more likely is that GW is very carefully monitoring the situation and is putting prices upto the maximum they can charge before the amount of people leaving them is far higher than the number joining the hobby - something that hasn't happened yet. Yes this is more about getting the maximum profit out of their customers as possible, rather than giving their customers the product they want at a resonable profit, but that is what the Shareholders want and in a PLC what the shareholders want is what goes.

Lets not forget that if 50% of the current customer base keep spending the same each year, but take twice as long to buy everything they need then you can stand to suffer a 50% drop in customer base and still be making the same profit (based on a rolling customer base, i.e. new customer join each year) in fact you would probably make more profit as you would need to make less moulds and use less plastic/resin.

 Kroothawk wrote:
Well, we know that revenue (inflation-adjusted at least) is nearly flat for several years.
We know that all introductory product prices (starter boxes, rulebooks, Codices, standard troops) were massively increased for several years until 2011.
We know that all character and elite troop prices were massively increased when recast in Finecast. Also all batallion boxes this year.
We know that Hobbit product prices are massively increased relatively to LOTR prices.
Any prices left not massively increased in the last few years?

Yes, many basic troops prices has stayed same for years (though some have increased because of repackages). And of course, transition to plastic has cut prices of some individual items. But of course majority of the prices have increased, in some cases very signifantly.

Actually, we do know that from the Chapterhouse suit that sales levels have fallen YoY.

 notprop wrote:
Borrowing to finance dividend speaks more on liquidity at a moment in time rather than a lack of profits which is not really an issue that GW have.

Where are you reading that they borrowed money to pay their dividends. The article I read made no mention of it. How are they borrowing money? Is it a Line of Credit they are using? Commercial Paper? Bonds? What sort of debt instrument are they using?


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12thRonin wrote:
Actually, we do know that from the Chapterhouse suit that sales levels have fallen YoY.

I must have missed that in their financial statements. Please provide a page number or was this in another press release?

The debt financing of the dividend was like 3-4 years ago now.

The sales figures were in documents released by the court supplied by GW. They have been retracted but the actual documents are in the wild still. Go read the last few pages of the Chapterhouse suit thread.

Stranger83 wrote:

Lanrak wrote:
If a company is paying dividends because it is growing the buisness, improving products and the demand for the products.NO PROBLEM.
Restructuring the buisness to make it more efficient , and sustanable long term, is also grounds for paying dividends.

However, wallet raping customers to the point they leave in droves , so the company chairman can pocket another £300K in dividends before he retires, may be seen as short sighted money grabbing of the worst order.

Just sayin'

Again, we have no idea if GW customers are falling, we do know that their sales have fallen but since profits are going up pretty much every year that would indicate a steady customer base with people just spreading the purchase of their armies over a longer period.

I do actually probably agree that the customer base has fallen, but personally I doubt it'll be as big as most people on here think.

Over the past 5 years (although I'm unfamiliar with UK accounting practices, only AU), without fully knowing what they changed in regards to reporting that changed their sales figures their sales have indeed been increasing.

If we simply brought 2004 turn over in to 2012 allowing for inflation.
That give us in excess of £175M.
As GW have implemented price rises and in game devaluation .(Lowering PV of models.)ON TOP of this .
They should have a turn over in excess of £300M if they kept constant sales volumes.

So GW plc are selling less than half of what they did 2004.
We can reasonably assume fewer people are spending the same amount as they were before.

And as there has been a massive swell of support for other companies in the TTMG hobby over the last few years.Its resonable to assume GW plc has lost a lot of existing customers, and new customer take up has slowed down due to prohibitive pricing.

As GW plc is focused on new customers ,and do not concern themselves with customer retension.
It is more likely fewer people are buying into GW.

As a Snap shot simply look at the reaction to the 'Hobbit range' prices. Compared to the favorable reaction the LoTR range recieved on release...

Even the released sales figures for the US .(From the CHS case.) Show reduces sales across all lines in monetary value...(Which doesnt even take into account the price rise.)

Lanrak wrote:


As GW have implemented price rises and in game devaluation .(Lowering PV of models.)ON TOP of this .
They should have a turn over in excess of £300M if they kept constant sales volumes.

Actually lowering the PV wouldn't effect the volume of sales - if I can only afford 1 unit a month then the lowerin gof the PV doesn't suddenly mean I can afford to buy 2 units a month, it just means I'd take twice as long to buy an army of the same points value - this would results in the same yearly profits, just for more years.

Lanrak wrote:

So GW plc are selling less than half of what they did 2004.
We can reasonably assume fewer people are spending the same amount as they were before.

Firstly, resonable based on what? How do you know that more people are not paying significantly more than they were before, or that the same number are paying less than they were before? The fact that it fits the image you have in your head does not make it reasonable.

Secondly, your value of 50% is high, based on the info in the chapter house suit - they only thing we have to base it on - they have fallen around 10%.

Your argument also presumes that all GW costs have gone up exactly by inflation, which is unlikely. Gas/Electic costs in the UK have risen nearly 30% in the last 3 years alone, I don't know the mechanics of how it all work, but I presume that there is a large amount of electricity used to power the machines that make miniatures, therefore their costs will have risen much higher than inflation. On the other hand, GW as a company does not have to by food for itself (ingnoreing the fact that it would have to increase wages of staff to pay for the food) or buy itself a house - both hings that have risen (or in the case of houseing fallen) below inflation in the last 3 years.

Inflation is based on the average cost of a family to live - as a company GW has a very different cost factor.

Lanrak wrote:

As GW plc is focused on new customers ,and do not concern themselves with customer retension.
It is more likely fewer people are buying into GW

Again, based on what? What actual facts do you have that fewer people are buying into GW? Yes they focus on new gamers rather than old (though I would argue that the Horus Heresy game is targeted specifically at veterans) but what factual information do you have that fewer people are starting up the GW hobby? Again, remember that a fall in sales does NOT mean a fall in customer base.


Whilst I agree that GW probably has had a fall in customer base, it is a luxuary item afterall and we are in a recession, plus their competitors are getting better and with the advent of the internet it's a lot easier for them to make themselves known. Despite that however I have yet to see any proof that the customer base has fallen, just a lot of people saying it has, people who are probably basing that upon their own gaming groups who have moved to other systems - but GW have always suffered from that, it doesn't take into account the new players starting out.

To bring it back on topic, based on the fact that we don't know if the customer base is falling, hell I doubt even GW can say that for sure, we can hardly say that GW should pay a dividend because of a falling customer base.

Sorry for the large number of edits, seems I forgot how to spell for awhile.

As GW plc keep telling everyone their gross margins have improved.
(EG ALL their costs excluding retail and logistics, make up a declining amount of their retail price.)

The last I heard they were running at 76% gross profit.
This means they are not suffering rampant cost increases forcing them to raise retail prices to compensate..(Down sizing stores to reduce the retail costs...)

And as my mate who works AT GW Nottingham has access to lots of actual costings, and sales data..

Sales volumes are falling year on year.

GW have always 'suffered' from older customer s 'growing up and moving on'...hence their total focus on recruitment .
(Rather than fixing the problem and generating long term appeal.)

So as customers usualy quit before 2 years in the GW hobby.(From GW own sales research, BTW.)

Then the main change to sales volumes would be a lower start up rate of new customers.
(As die hard fans will pay any amount for GW product.These would be the ones still involved with GW after many years.)

76% is the gross profit margin, the key point in that is Gross profit.

Gross profit is not ALL the costs, gross profit is simply the price you sell it at - the price of the materials/labour to make it (i.e the cost of the moulds and the plastic/resin) Electricity, building rates wages are all an overhead so would come out of the net profits, I don't have the figures for that on hand, maybe you do but any successful company will pay far more attention to net profit than gross (note, I'm not saying gross profit isn't important, just net is the key value that takes in ALL costs)

Yes traditionally GW has had customers for 2 years at which point they have their army and either don't buy new stuff or switch to another game system, but previously after 2 years you would have a "finished" army, if it now takes you 3 years for a "finished" army - due to price increases - does that mean that people will stop buying their army 2/3rds of the way through?

I guess it all depends on why people drop out of GW, is it because they grow to hate the game/company or they see another game and decide to try that, then yes they will still quit after 2 years and we can presume they have a falling customer base.

However if they quit because suddenly, after 2 years (which at 14/16 seems like a lifetime) you find yourself with a "finished" army and suddenly think to yourself 'well what do I do now?' and then go looking and find other companies (I can't speak for everyone but that is almost exactally how I found out about other companies - though I admit back then other games were very difficult to find and my first "other" game was BFG) then we can safely say that the lower sales just means people are taking 3 years to complete an army rather than 2 and the customer base is the same.

Like I say, I actually agree that GW has a falling customer base - we have the highest unemployment in years and, certainly in the UK, have had wage freezes for the past 3 years. It's hardly surpriseing that people are not starting up a new hobby.

Again, I reiterate falling sales, yes we know this. Falling customer base, likely but we simply do not know for a fact and saying it is a fact and quoteing falling sales as the reason we know this is just plain wrong.

Hi.
I think we may have been talking at cross perpouses a bit.(Sorry.)

The gross profit includes all costs apart from logistics and retail.(Logistic costs seem to be average ,less than 10% of gross profit.)

This is why GW are down sizeing B&M stores to one man stores and focusing more on retail to try keep retail costs under better control.
(Over 50% of gross profit!)However , this removes one of the reasons customers used to help justify the high prices.All the free hobby help and support in store.

It is not possible to give absolute proof the GW customer base is shrinking by a specific amount.(Even GW plc do not have the information to determine this .)

(GW plc do not think 'proper market research' into customer - product synergy to determine effective marketing is worthwhile.
Tom Kirby 's statement ' we sell toy soldiers to children ' has a lot of negative impact across lots of levels.)

However, the growth of other companies share of the market in the last few years, coupled with GW falling sales volumes , and compensatory price hikes.

Means its is a fairly logical and widely held theory...

 Kroothawk wrote:
Well, we know that revenue (inflation-adjusted at least) is nearly flat for several years.
We know that all introductory product prices (starter boxes, rulebooks, Codices, standard troops) were massively increased for several years until 2011.
We know that all character and elite troop prices were massively increased when recast in Finecast. Also all batallion boxes this year.
We know that Hobbit product prices are massively increased relatively to LOTR prices.
Any prices left not massively increased in the last few years?

"Massively increased" seems like an overstatement when inflation-adjusted price increases are not even always apparent over an 8-year span. I priced out the Marines I used in a recent game and compared them between now and 2004 (inflation-adjusted); they had gone up in price by 12% over eight years if you didn't count starter set availability savings and had gone down in price by 21% if you did. Further, the models had been vastly improved during that period.

Hardly a "massive increase."

Lanrak wrote:

(GW plc do not think 'proper market research' into customer - product synergy to determine effective marketing is worthwhile.
Tom Kirby 's statement ' we sell toy soldiers to children ' has a lot of negative impact across lots of levels.)

Citation needed?

Lanrak wrote:

However, the growth of other companies share of the market in the last few years

Again, any proof of this?


Automatically Appended Next Post:

 Kingsley wrote:

"Massively increased" seems like an overstatement when inflation-adjusted price increases are not even always apparent over an 8-year span. I priced out the Marines I used in a recent game and compared them between now and 2004 (inflation-adjusted); they had gone up in price by 12% over eight years if you didn't count starter set availability savings and had gone down in price by 21% if you did. Further, the models had been vastly improved during that period.

Hardly a "massive increase."

I said something similar a few pages back (or possible in another thread). The price of a necron army had remained the same (so in real terms had decreased by inflation between '04 and '12), and the price of a guard army had gone up about 4% a year. I was still flamed by about 8 posters who insisted I was insane and refused to use any facts whatsoever.

So yeah, expect the flame police any day now

 Testify wrote:
Citation needed?

From a publicly available end of year results document from a few years back - I'm sure Lanrak has the specific date.

 Kingsley wrote:
"Massively increased" seems like an overstatement when inflation-adjusted price increases are not even always apparent over an 8-year span. I priced out the Marines I used in a recent game and compared them between now and 2004 (inflation-adjusted); they had gone up in price by 12% over eight years if you didn't count starter set availability savings and had gone down in price by 21% if you did. Further, the models had been vastly improved during that period.

Hardly a "massive increase."

I don't know what "the Marines" are, but have a look at the introductory products I spoke of:
New Codex 2004 would be around 16 €, new Codex today is around 39 € (+143%). 40k starter set 2004 would be around 50€, today it is 78€ (+56%, with Hobbit starter set currently around 100€ +100%). 40k starter book was 50€, now 60€ (+20%, with Hobbit book 65€ +30%). And I haven't spoken of Finecast recasts or the new Hobbit plastic boxes yet!

Another thing to keep in mind with the "has it gotten more expensive" argument is point size:

What was the size of the average 40K or WFB army in 2000.

What is it now?

If it takes more models to play with now than it did 10 years ago, then the game has gotten more expensive even if the individual model cost stayed the same, and GW makes more money per "finished army".

40k is still 1850 around here, Fantasy got upped to 3k but has been downscaled to 1500 as barely anyone still plays it.

Not so much game points total.
But the way the PV values of units have fallen , to take more minatures to get to 1500 pts in the first place.

So.. how does this matter? At all?

It means GW products, esp. introductory products, get more expensive exponentially (even considering inflation), continuously raising the hurdle for new customers and losing old ones. Considering those price increases, flat revenue levels mean less sales each year and probably less customers. Having less sales and customers each year for 6-7 years is bad for a company outlook. That's why it matters.

Only for investors.

Players would arguably be better off if GW went bust and stopped fiddling with the rules.

It would be a shame for people whose codex was desperately out of date (mainly Tau, at this stage) but most other armies would be OK.

 Kilkrazy wrote:
Only for investors.

Players would arguably be better off if GW went bust and stopped fiddling with the rules.

It would be a shame for people whose codex was desperately out of date (mainly Tau, at this stage) but most other armies would be OK.

I don't think so. If GW should fall, I'm pretty sure another company would immediately hop on the bandwagon and would try to get the license.

 Kilkrazy wrote:
It would be a shame for people whose codex was desperately out of date (mainly Tau, at this stage) but most other armies would be OK.

Wood Elf and Sororitas players would like to have a word with you
Plus all people waiting for new shineys like flyers, monsters and terrain.

 Kroothawk wrote:
Having less sales and customers each year for 6-7 years is bad for a company outlook. That's why it matters.

Again, what proof do you have of falling customer numbers? Yes we know sales have fallen, we have no idea if the customer base has. Whilst I agree that GW customer base probably has fallen I cannot confirm it/ You can't just go around stating it as a fact without any kind of evidence to back it up.

I'd argue a little against the falling points values making the game more expensive. Those of us who have been around a while are happy to play 2000 points (or whatever value we suggest) because we have that number of troops to use, but there is no minimum value for games, if all you can afford is 500 points of stuff then the rules work perfectly at that level too whilst you build up a larger force (or even just stay at 500 for ever if thats what you like). You are not required to jump in at 2000 points to start., though I will accept that if you want to play in tournaments they tend to be around the 2000 point range, which you are correct then means you have to spend more.

Whether or not the customer numbers have fallen is largely irrelevant if the sales are falling (which is what the financials show).

The reduction in sales means that either the same number of customers are buying less (collecting smaller armies or dropping out earlier) or a smaller number of customers are buying as much. Both result in a reduction in the 'critical mass' of players, where people get into the game because people play it.

We can reasonably assume that since the cost of starting is increasing significantly, the number of starters must be decreasing as some will be priced out of the market.

As the business model is based on short-term customers spending lots of money before dropping out after a couple of years, a reduction in customer recruitment can only be seen as a bad thing in the long term, as at some point it'll become too expensive / obscure to attract new customers at all.


Regarding points values; from what I can tell of the FOC's, 500pt armies are pretty hard to make legally without having to bend rules, and the commonly used point values seem to remain constant (tournament and magazine points values haven't decreased), and getting a pick-up game of <1000pt is hard to do. So whilst you may not need a 2000pt army initially, you may find that you need at least 1000pt before you can participate in a lot of club games.

 d-usa wrote:
Another thing to keep in mind with the "has it gotten more expensive" argument is point size:

What was the size of the average 40K or WFB army in 2000.

What is it now?

If it takes more models to play with now than it did 10 years ago, then the game has gotten more expensive even if the individual model cost stayed the same, and GW makes more money per "finished army".

Good point. I noticed it with the new empire book - the subtle decrease in points of basic troops. Given that you need to operate empire troops in large blocks, it is clear that GW have a strategy i.e milk em till they're dry!

 Kroothawk wrote:
I don't know what "the Marines" are, but have a look at the introductory products I spoke of:
New Codex 2004 would be around 16 €, new Codex today is around 39 € (+143%). 40k starter set 2004 would be around 50€, today it is 78€ (+56%, with Hobbit starter set currently around 100€ +100%). 40k starter book was 50€, now 60€ (+20%, with Hobbit book 65€ +30%). And I haven't spoken of Finecast recasts or the new Hobbit plastic boxes yet!

I guess I don't see why you consider those comparisons valid. All of those products (except for the 40k stuff) had far, far less content in 2004 than they do now. Codexes were thinner and had less interesting material and fewer units, starter sets had many fewer models and the models they did have were inferior, etc. You also don't seem to have taken inflation into account.

Chadian shock troops where £18 for 20, now they are £18 for 10. Miniatures are exactly the same just half the original box contents. Inflation wasn't 100% over that period.

When talking about GW massively increasing prices without reason, just watch the LotR price increase from 2010 to now. It's downright disgusting and, to me, one of the main reason why it became so unpopular. Just check it out:

Until December 2010: 1 box = 24 miniatures = 15,50€ = 0,65€ per miniature.

Now: 12 miniatures = 19,50€ = 1,63€ per miniature.

Isn't that cool? Price increases by +150%.

 Kingsley wrote:

 Kroothawk wrote:
I don't know what "the Marines" are, but have a look at the introductory products I spoke of:
New Codex 2004 would be around 16 €, new Codex today is around 39 € (+143%). 40k starter set 2004 would be around 50€, today it is 78€ (+56%, with Hobbit starter set currently around 100€ +100%). 40k starter book was 50€, now 60€ (+20%, with Hobbit book 65€ +30%). And I haven't spoken of Finecast recasts or the new Hobbit plastic boxes yet!

I guess I don't see why you consider those comparisons valid. All of those products (except for the 40k stuff) had far, far less content in 2004 than they do now. Codexes were thinner and had less interesting material and fewer units, starter sets had many fewer models and the models they did have were inferior, etc. You also don't seem to have taken inflation into account.

Cost of entry. It doesn't matter if the codex now contains more information (well, fluff) or that the starter box contains more figures, it's still the minimum cost required to get into the game. It's what the new customers will see first, and a smaller starter set for a lower price would look better.

UNCLEBADTOUCH wrote:
Chadian shock troops where £18 for 20, now they are £18 for 10. Miniatures are exactly the same just half the original box contents. Inflation wasn't 100% over that period.

Yes, but Necron Immortals were $10.00 for 1 in 2004 (not inflation-adjusted) and now they're $33.00 for 5. Some models go up dramatically, some models go down dramatically.

 Kroothawk wrote:

 Kilkrazy wrote:
It would be a shame for people whose codex was desperately out of date (mainly Tau, at this stage) but most other armies would be OK.

Wood Elf and Sororitas players would like to have a word with you
Plus all people waiting for new shineys like flyers, monsters and terrain.

International rules ruling council, include previous GW staff like Alessio, Rick P, Andy H, Andy C, any of the current guys, if any of them wanted in. Regular FAQs, Frequent Rules rulings. Tournament clarification.

Numerous indy mini companies releasing monsters and such, best sculpts/prices get the business... You think if GW wasn't hovering ferociously over it's IP that the Sisters of Battle, sculpted by that guy from statuesque minis wouldn't be the sweetest models in the world? Or Enigma minis Wood Elf Wardancers?

Seems perfectly plausible for me. GW needs us, we do not require GW.

 Kingsley wrote:

UNCLEBADTOUCH wrote:
Chadian shock troops where £18 for 20, now they are £18 for 10. Miniatures are exactly the same just half the original box contents. Inflation wasn't 100% over that period.

Yes, but Necron Immortals were $10.00 for 1 in 2004 (not inflation-adjusted) and now they're $33.00 for 5. Some models go up dramatically, some models go down dramatically.

Lord of the Rings. An entire product line. Price increases of +150%.

Furthermore, the Necron Immortal comparison isn't working as good. First of all, Necron Immortals aren't the same as before. They are in a different slot, have -1 T and have a different weapon. Are those still the same models as before? Not to mention they are now 9 points cheaper than before. And are mostly equipped with Tesla weapons as their role changed as well...they still share the same name but their role differs.

Models going down in price is the exception rather than the rule, as anyone can see. There isn't a debate.

 MeanGreenStompa wrote:

Seems perfectly plausible for me. GW needs us, we do not require GW.

Speak for yourself. I enjoy collecting 40k, if you don't I'm at a loss as to why you post in a 40k forum at all.

 Testify wrote:

 MeanGreenStompa wrote:

Seems perfectly plausible for me. GW needs us, we do not require GW.

Speak for yourself. I enjoy collecting 40k, if you don't I'm at a loss as to why you post in a 40k forum at all.

We know you're a GW fanboy, but on the other hand, would GW being taken over somehow change your hobby of collecting stuff?

 Sigvatr wrote:

We know you're a GW fanboy, but on the other hand, would GW being taken over somehow change your hobby of collecting stuff?

I'm not a GW fanboy.

And you're kidding yourself if you think that another company picking up the IP would be better for the hobby. It might be a bit cheaper because they wouldn't have to pay for the stores, but on the other hand that means a lot less newcomers, and it'd be no cheaper than GW could offer if they shut down the stores themselves (give it time).

 Testify wrote:

I'm not a GW fanboy.

Yeeeeeeeeeeeeeeeeah, sure.

And you're kidding yourself if you think that another company picking up the IP would be better for the hobby. It might be a bit cheaper because they wouldn't have to pay for the stores, but on the other hand that means a lot less newcomers, and it'd be no cheaper than GW could offer if they shut down the stores themselves (give it time).

How could anything be worse than GW? Considerable price increases, increasing anti-gaming attitude...in what way would another company be worse? Even if GW shut down the stores, we would not see any decrease in prices. Not by a long shot.

 Testify wrote:

 MeanGreenStompa wrote:

Seems perfectly plausible for me. GW needs us, we do not require GW.

Speak for yourself. I enjoy collecting 40k, if you don't I'm at a loss as to why you post in a 40k forum at all.

You, yet again, fail at reading comprehension.

The discussion was an aside regarding the hypothetical fate of the games should GW cease to exist.

Go back, reread (or actually just READ what I said) and try, for the love of God, to contribute in a positive and mature way instead of your endless kneejerk reactions on this board, which have painted you as an absolute idiot, unless of course you are an absolute idiot and that measure of maturity is simply beyond your capacity to process.

Also, GROW UP.

 Kingsley wrote:

UNCLEBADTOUCH wrote:
Chadian shock troops where £18 for 20, now they are £18 for 10. Miniatures are exactly the same just half the original box contents. Inflation wasn't 100% over that period.

Yes, but Necron Immortals were $10.00 for 1 in 2004 (not inflation-adjusted) and now they're $33.00 for 5. Some models go up dramatically, some models go down dramatically.

So you say kroothawks examples aren't valid because the product has changed over time, I then post an example where the core product hasn't changed other than quantity for cost which was a good example in terms of changing cost over time. You then decry this example by creating one using a product that has changed over time, the very thing you stated invalidated kroothawks example. Make your mind up, you can't have your cake and eat it. All this shows is that you know your wrong but will try to take any stand point you think will prove you right.

 Testify wrote:
It might be a bit cheaper because they wouldn't have to pay for the stores, but on the other hand that means a lot less newcomers, ...

That's the GW Koolaid speaking.

For a time there, Oz was GW's most profitable region. At that time, we had less than a dozen GW stores scattered across a landmass the size of the US. GW stores are not required for recruiting new players (players do that themselves much better than GW ever has)... that's just the business model that they have managed to make work in the UK.

I would doubt that many of the uk stores pay fr themselves. Does anyone know if there are figures out there for online v shop sales?

GW business model is terrible the business could b streamlined by shutting dead weight stores.

I simply refuse to by GW products anymore the price to quality and quantity does not add up. Especially with so many great independent figure companies nowadays.

 Kroothawk wrote:

 Kilkrazy wrote:
It would be a shame for people whose codex was desperately out of date (mainly Tau, at this stage) but most other armies would be OK.

Wood Elf and Sororitas players would like to have a word with you
Plus all people waiting for new shineys like flyers, monsters and terrain.

Why do people continually forget that the Bretonnian army book is the oldest in their current range?

Downsizing is continuing in Oz, one of the largest Sydney stores is being downsized to a one-man (even with the massive floorspace) and stores are being closed left, right and centre.

 Testify wrote:
And you're kidding yourself if you think that another company picking up the IP would be better for the hobby.

They've licensed the IP out to other non-miniature related things (FFG RPGs, various video games) and those turn out fine. What makes the miniature and rules side of things any different to that?

Sigvatr wrote:
How could anything be worse than GW? Considerable price increases, increasing anti-gaming attitude...in what way would another company be worse? Even if GW shut down the stores, we would not see any decrease in prices. Not by a long shot.

I didn't say they'd be worse I said they wouldn't be any better. The stores are a huge overhead, their closure would definitely result in a reduction in prices, though more likely expressed as a slow down in price hikes than an actual reduction. In my humble opinion.

MeanGreenStompa wrote:
You, yet again, fail at reading comprehension.

The discussion was an aside regarding the hypothetical fate of the games should GW cease to exist.

Go back, reread (or actually just READ what I said) and try, for the love of God, to contribute in a positive and mature way instead of your endless kneejerk reactions on this board, which have painted you as an absolute idiot, unless of course you are an absolute idiot and that measure of maturity is simply beyond your capacity to process.

Also, GROW UP.

"Go back and reread what I put" is up there with "strawman" and "fanboy". It's bad enough making me read your posts once, please don't ask me to do so again (see I can make personal attacks as an excuse for a valid logical reasoning behind my arguments too!).

H.B.M.C. wrote:
They've licensed the IP out to other non-miniature related things (FFG RPGs, various video games) and those turn out fine. What makes the miniature and rules side of things any different to that?

Other than ignoring the casual base and catering exclusively to "hardcore" gamers, there's not much GW could do rules-wise. They won't make a rulebook that reads like parliamentary legislation (which is good imo), and they won't provide internal balancing (which is bad imo).

So yes another company could appease the "hardcore" gamers, but not without losing the casual crowd. I think the idea that you can have both is invalid.




Automatically Appended Next Post:

 insaniak wrote:

 Testify wrote:
It might be a bit cheaper because they wouldn't have to pay for the stores, but on the other hand that means a lot less newcomers, ...

That's the GW Koolaid speaking.

For a time there, Oz was GW's most profitable region. At that time, we had less than a dozen GW stores scattered across a landmass the size of the US. GW stores are not required for recruiting new players (players do that themselves much better than GW ever has)... that's just the business model that they have managed to make work in the UK.

Well I'd happily stand corrected. I find it hard to believe that their high street presence doesn't give them a much bigger reach than comparable games companies though, maybe that's because the UK has a dozen or so "large" cities and GW stores are pretty much ubiquitous.

 Smillie wrote:
I would doubt that many of the uk stores pay fr themselves. Does anyone know if there are figures out there for online v shop sales?

GW business model is terrible the business could b streamlined by shutting dead weight stores.

That's what they have been doing, and whaddaya know, people complain that they're killing the hobby by closing down stores.


Automatically Appended Next Post:

 Sigvatr wrote:

How could anything be worse than GW? Considerable price increases, increasing anti-gaming attitude...in what way would another company be worse? Even if GW shut down the stores, we would not see any decrease in prices. Not by a long shot.

Any company that would pick up GW's IP would simply end up new GW, simple as that, and little or nothing would change.

Herzlos wrote:
Whether or not the customer numbers have fallen is largely irrelevant if the sales are falling (which is what the financials show).

The reduction in sales means that either the same number of customers are buying less (collecting smaller armies or dropping out earlier) or a smaller number of customers are buying as much. Both result in a reduction in the 'critical mass' of players, where people get into the game because people play it.

We can reasonably assume that since the cost of starting is increasing significantly, the number of starters must be decreasing as some will be priced out of the market.

As the business model is based on short-term customers spending lots of money before dropping out after a couple of years, a reduction in customer recruitment can only be seen as a bad thing in the long term, as at some point it'll become too expensive / obscure to attract new customers at all.


Regarding points values; from what I can tell of the FOC's, 500pt armies are pretty hard to make legally without having to bend rules, and the commonly used point values seem to remain constant (tournament and magazine points values haven't decreased), and getting a pick-up game of <1000pt is hard to do. So whilst you may not need a 2000pt army initially, you may find that you need at least 1000pt before you can participate in a lot of club games.

Actually it does not necessarily mean either of those, it is possible that GW have the same customer base who are buying less each month due to the price rises but will still eventually buy the same size army (for the sake of argument lets say 2000 points) now previously they would have bought this in 2 years, now it takes them 3 - giving GW their customer for a whole extra year.

Therefore the argument could easilly be that GW price rises are good for the company as they keep customers buying for longer.

I'm not saying that is the case - I have said multiple times in this thread that my personal belief is that customer numbers are falling, but we have no proof of that.


Automatically Appended Next Post:
Taking the thread back to the dividend again for a moment, an argument that nobody seems to have made - The thread started by saying that the dividend was being paid for by massive price increases driving away the customer base, so lets analyse this for a moment. GW has slightly over 3 million shares, at 17p each that works out at (roughly) £600,000 total payout . Now I can't find their annual report to the year end, but the annual report to June 2012 showed a total turnover of £131million.

Based on an average sale price of £15 (which is around about the GW mid point, single models/paints/brushes are all less than that, units/ codexes and army boxes are more) then we can safely say they sold around 8733333 items (again this is roughly speaking) if we subtract the cost of the dividend from each unit sold then they would become 7p cheaper each.

Do you still feel that the price rises are going to pay the dividend?

UNCLEBADTOUCH wrote:

 Kingsley wrote:

UNCLEBADTOUCH wrote:
Chadian shock troops where £18 for 20, now they are £18 for 10. Miniatures are exactly the same just half the original box contents. Inflation wasn't 100% over that period.

Yes, but Necron Immortals were $10.00 for 1 in 2004 (not inflation-adjusted) and now they're $33.00 for 5. Some models go up dramatically, some models go down dramatically.

So you say kroothawks examples aren't valid because the product has changed over time, I then post an example where the core product hasn't changed other than quantity for cost which was a good example in terms of changing cost over time. You then decry this example by creating one using a product that has changed over time, the very thing you stated invalidated kroothawks example. Make your mind up, you can't have your cake and eat it. All this shows is that you know your wrong but will try to take any stand point you think will prove you right.

The difference is that in Kroothawk's examples, you're paying more because you get more stuff. So you pay more for more, which counters Kroothawk's claim that you pay more for an equivalent item. The items aren't equivalent-- a starter set that contains 10 Tactical Marines, a Land Speeder, and 20 Dark Eldar Warriors is not equivalent to a starter set that contains 10 Tactical Marines, 5 Terminators, 3 Bikes, a Librarian, a Captain, 20 Cultists, 5 Chosen, a Chaos Lord, and a Helbrute.

In my example, 5 Necron Immortals are equivalent to 5 Necron Immortals.

I suppose you could argue that the new Necron Immortals aren't equivalent to the old ones. The only problem with that line of argument is that then you have to admit that the new Necron Immortals are better than the old ones, and therefore you are paying less for more and better models-- hardly an argument in favor of the thesis that GW hikes prices extravagantly!

Or the fact that they have changed material which has very different cost implications, again your not getting the same ad before which is what your arguin is invalid.

Stranger83 wrote:

Herzlos wrote:
Whether or not the customer numbers have fallen is largely irrelevant if the sales are falling (which is what the financials show).

The reduction in sales means that either the same number of customers are buying less (collecting smaller armies or dropping out earlier) or a smaller number of customers are buying as much. Both result in a reduction in the 'critical mass' of players, where people get into the game because people play it.

We can reasonably assume that since the cost of starting is increasing significantly, the number of starters must be decreasing as some will be priced out of the market.

As the business model is based on short-term customers spending lots of money before dropping out after a couple of years, a reduction in customer recruitment can only be seen as a bad thing in the long term, as at some point it'll become too expensive / obscure to attract new customers at all.


Regarding points values; from what I can tell of the FOC's, 500pt armies are pretty hard to make legally without having to bend rules, and the commonly used point values seem to remain constant (tournament and magazine points values haven't decreased), and getting a pick-up game of <1000pt is hard to do. So whilst you may not need a 2000pt army initially, you may find that you need at least 1000pt before you can participate in a lot of club games.

Actually it does not necessarily mean either of those, it is possible that GW have the same customer base who are buying less each month due to the price rises but will still eventually buy the same size army (for the sake of argument lets say 2000 points) now previously they would have bought this in 2 years, now it takes them 3 - giving GW their customer for a whole extra year.

Therefore the argument could easilly be that GW price rises are good for the company as they keep customers buying for longer.

I'm not saying that is the case - I have said multiple times in this thread that my personal belief is that customer numbers are falling, but we have no proof of that.

But that's assuming that completion of armies equates to leaving the game, and that the new players who are dropping out will stay on for another year if they haven't completed an army. The drop out seems to be age / time related; from what I can tell most players get into it at an early-mid teen stage and start to disappear from the scene at the mid-late teen stage where other things are more important (girls, booze, looking cool, going to uni), and then many come back in their mid 20's when they have more time.

I at least, dropped out of the hobby when I was about 16-17, when I was old enough to sneak into nightclubs, and took it back up at about 26, and I still don't have a complete army


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 Testify wrote:

Other than ignoring the casual base and catering exclusively to "hardcore" gamers, there's not much GW could do rules-wise. They won't make a rulebook that reads like parliamentary legislation (which is good imo), and they won't provide internal balancing (which is bad imo).

So yes another company could appease the "hardcore" gamers, but not without losing the casual crowd. I think the idea that you can have both is invalid.

Not really, the hardcore gamers just want clear, streamlined, balanced rules, and the new gamers would benefit from clear, streamlined, balanced rules.

Clear rules don't need to be tome-like, and to be fair most of the problems in the GW rulebooks is because there are just too many overlapping and contradictory rules.

There's no reason they can't cater to both, except that it'd require a ground up re-write of the current rule incarnations, and that would go against their model sale waves (as they'd need to bring out the rules and army books together).

UNCLEBADTOUCH wrote:
Or the fact that they have changed material which has very different cost implications, again your not getting the same ad before which is what your arguin is invalid.

I'm arguing from the gamer's perspective. The average gamer doesn't care what material something is made out of. They care how much it costs and whether or not it looks good. I don't know anyone who chooses units in their army based on what material the models are made out of.

 Kingsley wrote:

UNCLEBADTOUCH wrote:
Or the fact that they have changed material which has very different cost implications, again your not getting the same ad before which is what your arguin is invalid.

I'm arguing from the gamer's perspective. The average gamer doesn't care what material something is made out of. They care how much it costs and whether or not it looks good. I don't know anyone who chooses units in their army based on what material the models are made out of.

You don't?

I live in a country with very few gamers and I personally knew more than 10 people that avoid Finecrap like the plague and resort to converting plastic minis (or using minis from other companies), to replace them.

 Kingsley wrote:

UNCLEBADTOUCH wrote:
Or the fact that they have changed material which has very different cost implications, again your not getting the same ad before which is what your arguin is invalid.

I'm arguing from the gamer's perspective. The average gamer doesn't care what material something is made out of. They care how much it costs and whether or not it looks good. I don't know anyone who chooses units in their army based on what material the models are made out of.

Yes they do; because they need to assemble/paint/use the figure, and some materials have advantages over others. If they find one material better than another they'll prefer it, and if they've had a bad experience with a material they'll avoid it where they can.

Incidently, I prefer plastics to (real) resins to metals, and won't touch finecast. Many older gamers are metal only. Many new gamers probably don't realise metal figures exist(/ed)

 Kingsley wrote:

UNCLEBADTOUCH wrote:
Or the fact that they have changed material which has very different cost implications, again your not getting the same ad before which is what your arguin is invalid.

I'm arguing from the gamer's perspective. The average gamer doesn't care what material something is made out of. They care how much it costs and whether or not it looks good. I don't know anyone who chooses units in their army based on what material the models are made out of.

I do. I absolutely hate metal miniatures because they did not allow for any modifications. All my Necron Warriors in my army are altered to stand upright in the very same position. Would be impossible with metal miniatures. When it comes to plastic vs finecast, I agree.