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It would appear that the directors don't believe GW finances are out of the woods yet...

http://www.reuters.com/finance/stocks/keyDevelopments?rpc=66&symbol=GAW.L×tamp=20090728060000

Games Workshop PLC Not To Proposes Final Dividend
Tuesday, 28 Jul 2009 02:00am EDT

Games Workshop PLC announced that final dividend has not been proposed and there were no dividends paid in the year.

I'm sure two new marine codices in 2010 will turn things around for them.

Like the total reboot of 40k and the relase of the vanilla marines codex did last year and the inception of Apoocalypse did maybe? Or Space Hulk this, or the release of WFB 8th edition did next?

No individual army buff will "save" GW, only somehow if and when they manage to convince more people to start buying their models than are quitting/downsizing/moving on will they see a return to increaing profitability. And I can't see anything in any of their current strategies that is going to deliver that result.

The only strategy GW knows is MORE MARINZ!

Unless the introduction of a new fantasy edition as rumoured is the idea. Perhaps 40k is at its point of saturation. So keep 40k at it's current level with the new codicies in 2010 but expand Fantasy.

Finally, perhaps FFG will save their sorry asses by producing a few more great games and supplements.

Osbad wrote:Like the total reboot of 40k and the relase of the vanilla marines codex did last year and the inception of Apoocalypse did maybe? Or Space Hulk this, or the release of WFB 8th edition did next?

No individual army buff will "save" GW, only somehow if and when they manage to convince more people to start buying their models than are quitting/downsizing/moving on will they see a return to increaing profitability. And I can't see anything in any of their current strategies that is going to deliver that result.

Do the Dawn of War games do nothing for their stock? What about the new Space Marine game coming to XBox 360? The new Ultramarine movie? Don't these things play into their financial future?

A few people that see Ultramarine may say, "What is Warhammer 40,000 all about? Oh! A game I can play? Sweet!"

olympia wrote:The only strategy GW knows is MOAR MAREENZ!.

Fixed your post.

Yeah, and then they find out the game involves nerdy models they have to assemble and paint themselves, realize that they may actually want to get laid again sometime in the future, and instead buy the Space Marine game for the 360 and leave it at that.

Sidstyler wrote:Yeah, and then they find out the game involves nerdy models they have to assemble and paint themselves, realize that they may actually want to get laid again sometime in the future, and instead buy the Space Marine game for the 360 and leave it at that.

words can hurt.

They need to lower thier prices somewhat to see any real change. I know many people who would like to play but look at the cost of anything outside the starter boxes and throw up a little. Doesn't have to be a huge drop, but maybe making the plastic terminator box of 5 $40 dollars instead of 50 would make a huge different. This isn't 1992 when they were the only game in town. With PP, Rackham and others nipping at their heels they can't keep pricing as if they are alone in the field. It is why I haven't bought anything since the Tau were originally released. I would love to build an IG army but it is to ridiculous to justify it so i just keep dreaming.

Hobbit movies in the next few years should help awareness of LOTR/WOTR.

Licensing for games could be a key strategy but unless the Geedub habit of a lifetime changes I wouldn't expect to see any morr deals being made with 3rd parties.

That said all the furore over the C&D's being issued could mean a new direction for some of their specialist range. I could see things like BB, 'Munda even epic being more mainstream, gaming purists would hate. it but a blind blister collectable BB game range that could have some mileage. Simplify the rule sets for a high street boxgame if I was a share holder I would want to see some more movement into that sector whilst holding the core as is?

Just my ramblings on the subject.

olympia wrote:

Sidstyler wrote:Yeah, and then they find out the game involves nerdy models they have to assemble and paint themselves, realize that they may actually want to get laid again sometime in the future, and instead buy the Space Marine game for the 360 and leave it at that.

words can hurt.

I feel your pain.

Those people already prob have trouble getting laid in the first place due to their own problems. So don't blame GW, I play and have slowed amounts of models but that doesnt stop me from having a steady girlfriend. I also play to many video games but I digress.

Ahtman wrote:They need to lower thier prices somewhat to see any real change. I know many people who would like to play but look at the cost of anything outside the starter boxes and throw up a little. Doesn't have to be a huge drop, but maybe making the plastic terminator box of 5 $40 dollars instead of 50 would make a huge different. This isn't 1992 when they were the only game in town. With PP, Rackham and others nipping at their heels they can't keep pricing as if they are alone in the field. It is why I haven't bought anything since the Tau were originally released. I would love to build an IG army but it is to ridiculous to justify it so i just keep dreaming.

Depends what their strategy is but the simple rule is:

say their current profit margin is 30% (im just guessing) if they reduce pricing by 6% they then need to increase sales volume by 25% to maintain the current margin. Drop by 10% and that uptake needs to be 50% more.

conversely by putting prices up the PM being 30% and INCREASING prices by 6% sales would have to decline by 17% before profit is affected an increase of 10% means that sales would have to decline by 25% before profit declines.

Its better to increase and loose customers than decrease and have to find extra customers.

Sounds bad in such a sterile format as this but thats the basic problem facing any business.

I have 44 shares. I used to get about £2.50 a year.

There goes my Christmas fun money :(

I think timely, good quality updates of Tau, Necrons, Eldar, Tyrannids and Dark Eldar actually might help refresh 40K a bit better than several more variant colour Mariens.

Oh well, Christmas is as good a time as any to raise prices. And if anyone complains, the apologists can come here to reassure us that higher prices are a good thing.

H.B.M.C. wrote:Oh well, Christmas is as good a time as any to raise prices. And if anyone complains, the apologists can come here to reassure us that higher prices are a good thing.

Higher prices are not a good thing. The pricing on GW product makes it extremely prohibitive for me to purchase at the moment. But I think I am a rounded enough person to look at the possible reasons for GWs high price points over the last year or so.

puma713 wrote:Do the Dawn of War games do nothing for their stock? What about the new Space Marine game coming to XBox 360? The new Ultramarine movie? Don't these things play into their financial future?
A few people that see Ultramarine may say, "What is Warhammer 40,000 all about? Oh! A game I can play? Sweet!"

Oh they won't hinder, and neither will the licence money from FFG for the board games they are producing, and it could be argued that without them but they ain't going to save the ship. in the year to May '09 GW made something like £3.4M in royalties which was almost half of their Profit before Tax of £7.5M. Take that away and also take away their windfall exchange rate gain that year and they would have made yet another loss. And that, in all likelihood would have been the end of them. So it has saved their bacon. But are they going to grow faster than their sales of model soldiers are shrinking? Hard one to call. WAR did OK, which clearly brought in some wonga last year but will it do so again this year. Will DoWII? It's all marketing and marketing a niche, expensive hobby in a recession is a tricky call.

All we can say for certain following last year's results is that GW don't yet feel confident enough to restart paying dividends having halted them after the LotR bubble finally finished bursting. And
corporately speaking that is a Really Bad Thing.

If I were a betting man, I'd not put any on them doing so anytime soon until they do something that regenerates their long term player base and encourages players to stick around longer than 12 months before jacking the games in for a bad lot. But what would I know?



Ultimately we're all guessing, but I remain pessimistic about their long term financial viability.

Just to clarify : this news is from back in July right ?

They should lease out many of their old games. Release themselves from the burden of supporting specialist games and simply gather a licence fee for them, Blood Bowl would be a good start.

Unless major investors start getting shaky and off load shares GW will be around for a while.

I don't think these losses will be a concern for the investment market. Though I have heard that if investors pour money into 10 businesses/funds and 7 or 8 go bump then its a good result for them!



Automatically Appended Next Post:

Howard A Treesong wrote:They should lease out many of their old games. Release themselves from the burden of supporting specialist games and simply gather a licence fee for them, Blood Bowl would be a good start.

The problem is that the specialist ranges are offshoots of their core games, if they offload the BB IP for instance then they would run the risk of harming WHFB - same setting same races etc.

If GW could work alongside more 3rd parties. independants and license holders it would be win all round.

reds8n wrote:Just to clarify : this news is from back in July right ?

The boyz are working themselves up for the daily rant, and you bring facts into this?! What kind of horrible person are you?

Mr. Burning wrote:Its better to increase and loose customers than decrease and have to find extra customers.

Sounds bad in such a sterile format as this but thats the basic problem facing any business.

And it is working great for them at the moment, just ask the shareholders.

mikhaila wrote:

reds8n wrote:Just to clarify : this news is from back in July right ?

The boyz are working themselves up for the daily rant, and you bring facts into this?! What kind of horrible person are you?

It passes the time of day I suppose.


Automatically Appended Next Post:

Ahtman wrote:

Mr. Burning wrote:Its better to increase and loose customers than decrease and have to find extra customers.

Sounds bad in such a sterile format as this but thats the basic problem facing any business.

And it is working great for them at the moment, just ask the shareholders.

Anticipated Pre tax profit of 10+ million for '10 and 11+million for '011 with additional growth possible. Share holders/stakeholders/investors will look long term. Just because there is no dividend doesn't mean the company is shaky.

And there goes the egg on my tie!

Yes it does appear to be a July press item, looking at the time stamp!

So I wonder why it only popped up in my RSS catcher this morning?

Sheesh! Seems like Granny Wendy isn't the only one that doesn't understand the internet!

Move along now, nothing to see here...

Mr. Burning wrote:Anticipated Pre tax profit of 10+ million for '10 and 11+million for '011 with additional growth possible. Share holders/stakeholders/investors will look long term. Just because there is no dividend doesn't mean the company is shaky.

I never said they were shaky or that they were in any way about to go under any time soon. Please do not put words into my mouth. I think their model makes them profitable, but not as profitable as it could/should be if they made some changes, one being their pricing structure.

Ahtman wrote:

Mr. Burning wrote:Anticipated Pre tax profit of 10+ million for '10 and 11+million for '011 with additional growth possible. Share holders/stakeholders/investors will look long term. Just because there is no dividend doesn't mean the company is shaky.

I never said they were shaky or that they were in any way about to go under any time soon. Please do not put words into my mouth. I think their model makes them profitable, but not as profitable as it could/should be if they made some changes, one being their pricing structure.

sorry.

Ok I know people are wondering with the whole DOW, and FFS boardgames, and the "new codicies" helping,ubt believe it or not they do and they don't. A basic overview of how it all works. GW just gets royalties from these products as other companies directly produce them. Stocks when traded publicly such as GW's is actually have little bearing to do on actual inflow of money. It is a little confusing, but in basics stocks go up and down by how many people buy them not by money the company makes. Now this si the confusing what the company does is takes a percentage from what they made that year and redistributes this back to the share holders. Looking at it it could be anywhere from several cents,pints,loonies whatnots into actual paper currency. So for exp if say our stock is at $40.00 U.S a share. Now our company made a gross of $100million this past fiscal year with an overall net profit of say $32million. Now we take that $32million and say OK out of this we can afford to give with 7million shares of stock being publicly traded say 2to3 dollars ashare back to our stock holders. This is almost a thank you if you will in the simplist of terms. Now if you understand the stock market you know that some companies used to be high like citigroup and what not but in actuallity their real value in the industry was low for a number of years. Citigroup would not have to pay out a dividend due to they did not make a net profit, unless they have it in their by-laws that says they have to pay quarterly off the gross.

If you understand that kudos, if not don't worry. Took me years to learn all of this junk in the basic form.

P.S the only time product does fully come into effect is when the corp. or L.L.C is owned privately

The fact that GW is not paying dividends is no surprise. It has little to do with how they are doing and more to with competition. The competition I'm speaking of is between companies not a product level but on an investor level. With the economy stewing right now fewer companies are making a profit, there stock price aren't as high and they aren't paying their dividends. Smaller companies like GW (hundred million as opposed to multi-billion dollar companies) to get captial have to attrack investors to purchase their stocks, but as a smaller company they tend to have to pay out more dividend to compete for those investors. With fewer worthwhile stocks, GW doesn't need to compete as hard and thus doesn't need to pay dividends. This isn't about being profitable its about relative profitability in comparison to the next guy.

aka_mythos wrote:The fact that GW is not paying dividends is no surprise. It has little to do with how they are doing and more to with competition. The competition I'm speaking of is between companies not a product level but on an investor level. With the economy stewing right now fewer companies are making a profit, there stock price aren't as high and they aren't paying their dividends. Smaller companies like GW (hundred million as opposed to multi-billion dollar companies) to get captial have to attrack investors to purchase their stocks, but as a smaller company they tend to have to pay out more dividend to compete for those investors. With fewer worthwhile stocks, GW doesn't need to compete as hard and thus doesn't need to pay dividends. This isn't about being profitable its about relative profitability in comparison to the next guy.

see where were you 20 minutes ago because your explanation is a hell of a lot easier to understand then mine.