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Made in gb
Decrepit Dakkanaut




UK

https://s19485.pcdn.co/wp-content/uploads/2019/01/2018-19-half-year-report.pdf

A few things I picked up from it that are of interest:
Realisation of some "major investments" to come this year. Things like the new factory (still under construction/design and not operational yet - to be expected as it was only started last year) but also this strongly hints are more mould production adn thus more new models for the game - ties well with a big AoS release year potential.

Foregeworld and Black Library sales down, but not by a vast amount (£4.6 instead of £5.2 million for both). Unless they split the values in the numbers that come at the end they didn't specify which was lagging, though we could assume that the FW sales were the most down after the international price changes (potentially though this isn't mentioned in the report)

Australia and New Zealand are not growing in sales and were the only territories like this. No surprise considering that the price of GW models is its highest there, almost to be expected. If this pattern continues it might make GW revise their trading agreements and pricing structure there if nowhere else; but that could take a long time. It might also not just be price but market exposure; GW might have tapped into the entire market within those two countries within its current architecture and needs to expand stores to new regions to tap into new markets.





Overall the report sounds very positive, most things are on the up and the current last years policy has done well to boost sales overall. There's mention of Brexit, but in general its in the "keep an eye on it and keep the ship stable" area; which basically reflects many companies who are still waiting for the final verdict. It doesn't sound like GW has to stockpile any resources from EU traders (I'm aware some companies are stockpiling just to help overcome any period of instability or trade shut down that might take place in the short term - at least if they rely on imports from EU countries). If anything GW would be on the opposite end of things and more likely to end up with a surplus of production if there were trading issues.

A Blog in Miniature

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Blimey. Royalties have jumped a fair bit. Almost £2,000,000!

   
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Sadistic Inquisitorial Excruciator




That'll probably be in part due to the hugely successful Total War Warhammer series.

My share prices are slowly rising again though,

Disclaimer - I am a Games Workshop Shareholder. 
   
Made in gb
Decrepit Dakkanaut




UK

I'd wager Battlefleet Gothic 2 might also be a strong seller! The first game had its gaps, but if the second is half as goodas they are advertising then it could really be a strong title.

Warhammer still has the 3rd game to go so I'd wager the signs are good we'll see CA take on another Warhammer title after that (AoS ! )

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Made in ca
Posts with Authority




I'm from the future. The future of space

TLDR: Great year but growth is getting more expensive for the next pound earned. More price increases on existing popular items and the 2 army box sets like Wrath & Rapture could be on the horizon.

Long post:

Revenue by channel:
Trade £61.4m
Retail £42.6m
Online £21.2m

Profit by channel:
Trade £22.5m
Retail £4.8m
Online £13.1m

Their retail operation is actually getting better. it's still the least cost effective way for GW to generate profit. The stores in the cities I've been to recently recently transitioned back to having more staff.

I'm a little surprised that their online engagement isn't translating into online store sales growth. There are product purchase links all over but the online store didn't really experience any growth in sales over the last year (though it did to get to it's current level in previous years since GW embraced using the internet). The low overhead of online sales means that it's easily the most efficient way for GW to make money on the sale of a given kit, but this report, retail and trade grows but online sales don't.

"We are also announcing that the Board has today declared a dividend of 25 pence per share, in line with the Company’s policy of distributing truly surplus cash."

They are maintaining their high, but sane, dividend payout. The looting of the company treasury at the expense at investing of investing in the business is probably gone with Kirby.

"Our online marketing remains one of our great strengths. The main Warhammer Community website continues to increase its readership, with visitor numbers up an impressive 30% compared to the same period last year - now almost a million visits to the site each week."

Anyone worried that GW is going to suddenly return to silent mode definitely doesn't need to. It's actually funny how impossible this sentence would have been to predict during the Wells and Kirby years.

"Sales in our Citadel online shop were flat compared to last year and our Forge World and Black Library stores declined slightly at £4.6 million"

Horus Heresy is winding down. And with GW making more and more big kits, Forgeworld being relegated to being the "B project" studio is probably going to mean we should expect further declines there. Their global pricing change is also probably going to be a significant barrier to a return to growth there.

"During the period our return on capital declined from 119% at November 2017 to 96% at November 2018. This was driven by the increase in investment in capacity and in working capital, offset by an increase in operating profit before royalties receivable."

It's a seriously good return on capital but it is declining. Things like this can go in cycles though as capital investments don't tend to pay off in the same year they are made. So it's likely for this to dip further before moving back up. This is a key metric for GW's board and they'll be watching their margins like hawks going forward. Start Collecting boxes getting a price hike makes a lot of sense given this decline.

Cost of sales 6 months in 2018:(41,392) same period 2017(30,590)

While the revenue for the same period increased ~16 million the costs rose ~11 million. The cost of sales for the last financial full year was a bit over 60 million for the whole 221 million of revenue. This latest bit of growth is expensive.

"As we move to complete a series of major investment projects, our gross margin and stock levels are not currently where we’d like them to be."

It's still great, but I can see why they aren't happy with the direction their margins are going. They're still nice and high but if the new factory and warehouse expansions end up with pretty high ongoing costs, GW may end up considering more across the board price increases to restore their margins and their return on capital to their target levels.

It's also possible that new larger sets might get a price increase. For example the 2 army starter and battle sets might get pushed up to 100 pounds rather than the current 95. Things like Soul Wars, Dark Imperium, Wrath and Rapture, and so on. We'll see, but the combined Flesh Eater Courts and Skaven set might be the first box set at a higher price.

Balance in pick up games? Two people, each with their own goals for the game, design half a board game on their own without knowing the layout of the board and hope it all works out. Good luck with that. The faster you can find like minded individuals who want the same things from the game as you, the better. 
   
Made in si
Foxy Wildborne







 frozenwastes wrote:
More price increases on existing popular items and the 2 army box sets like Wrath & Rapture could be on the horizon.


Should go without saying. Anything that's more or less two Start Collecting! sets put together will go up alongside them.

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Made in es
Brutal Black Orc




Barcelona, Spain

So I've just found something very, very, interesting while navigating the internet's special hellhole.



I don't know why we are suddenly talking about how well AoS sells but if you do care to know, GW expected AoS to be in soft loss at least till december 2020, while it's doing fairly good since march 2018, raking the 27% of incomes from sculptures sales.
So it's doing pretty fething good.

>sorce: my ass, you will just have to belive me, I do know the numbers.

*Question about whether or not the percentage includes underworlds*



It does not, those are seen more as boardgames and are still mostly there to experiment, GW still doesn't really know if she wants to push them too mutch and doesn't really care for the figures (they are incredibly low next to AoS and 40K).

*Someone stating bafflement at such a long horizon for expected profits*


t's basically a new IP, any investement so bigs needs a lot of time to start growing interests and GW knew very well how hard would the backlash be on killing fantasy, making the first years of AoS even more dreadfull.
In addition, AoS costs a fuckton more than 40k. You can like the results or not, but there are a lot more people working on balancing, testing and shaping the game since it has to stand on it's own merit while 40k just works thanks to the massive customer base it has.

*Someone asks about exact numbers*

I don't know any exact numbers on that since it's not in my line of work. There is a budget for data research, publicity and development; Nightvault, Kill team, Quest and all that goes in that budget and it's considered a loss, whatever it can make back is just a plus. I have no idea on it's growth monetary speaking but I do know we send more to stores but that's about it.

>>64081713
As far as I do know, and I don't know mutch, there isn't any Seraphon warband in development.

*Someone else asks about what is popular in AOS.

It includes 40, lotr, scenery and necromunda, it doesn't include FW of any kind.

I don't know what is popular in AoS since all I analize are the income numbers and that is not a good indicator of popularity.
To make it more clear, some armies cost a lot more than others so 10 players collecting them gives way more money than 20 players collecting a cheaper army.
The best I can tell you is what armies are selling more than GW expected or exceptionally good in general, those armies are:
>Selling more that they should: Ironjaws, Seraphon, Beastclawriders, KO
>Selling a great lot: Tzeench/Nurgle/Khorne, LoN

I can give you a couple weird fact thou: Dispossessed and Devoted of Sigmar where supposed to be cut from the store long time ago (no squatting, just not bothering to make more of them untill a repack/redesign) but GW simply can't do that since they keep selling pretty well and so there is no reason to spend more money into upgrading the box for now.

My team is responsable for the new thing of making faction specific scenery. We noticed how making new scenery was very hard since it takes a lot of time for them to start making money since painters bought them but players did not, the only expection has been the Feculent Nurgle three, so we experimented with that idea and now they sell like hot cakes both to players and painters.



Also, apparently they have a team, the same team behind the latest battletome, working on dispossessed.

This message was edited 2 times. Last update was at 2019/01/16 09:40:31


 
   
Made in gb
Ridin' on a Snotling Pump Wagon






Always very sceptical of such post. Always. Regardless of whether they claim good or bad news.

   
Made in es
Brutal Black Orc




Barcelona, Spain

It's an interesting, possible insight. Regardless, you know the drill



Hopefully there is indeed an upcoming dispossessed battletome.

This message was edited 1 time. Last update was at 2019/01/16 09:45:23


 
   
Made in gb
Ridin' on a Snotling Pump Wagon






I absolutely accept that production costs on AoS are more than 40k. After all, it's getting what, three or four entirely new factions a year? Each needs at least half dozen boxes (which may produce more than one unit) to go with it, entirely new book and artwork to boot.

But, kernel of truth doesn't mean we should treat the whole thing as gospel

   
Made in gb
Decrepit Dakkanaut




UK

AoS costing more makes sense, not only are they releasing new armies but many of the old ones need new kits to boost them up to a functional force; plus many of the sculpts were finecast or old.

Basically they are reaping what they sowed years ago when Fantasy was left to a corner and ignored too much. However the fact that sales are apparently booming for the range is fantastic because it means that GW is more likely to keep pushing investment in at a high level now and later ease back once the tomes and armies are settled and estabilshed - then they can reap more profits from a strong selling game, where they only have to dip back in with a new model here and there into the armies over time.


40K has a few armies here and there that need updates like Cultists, but by and large its mostly a case of releasing udpated sculpts now and then rather than big army scale releases. Most of the work there has been in codex and the like.

Fingers crossed that this year is a big year for AoS army releases; expensive for GW in moulds, but once done should leave AoS in a really strong position and break down more barriers to entry for gamers.

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Ah well, the moulds for AoS stuff this year have likely all ready been made, given the lead times

That's likely reflected in the financials.

   
Made in gb
Decrepit Dakkanaut




UK

 Mad Doc Grotsnik wrote:
Ah well, the moulds for AoS stuff this year have likely all ready been made, given the lead times

That's likely reflected in the financials.


Yep so a heavy investment period that puts up costs followed by a reduced investment period where profits should be up. I'd wager once they've got AoS fully battletomed up they should see a pick up in sale because it should be a lot easier to convince people to get into the game. Grab an army Battletome - get on the table and play.

Plus at that point we'll likely see them push out Skirmish as its own brand product like they have for Killteam. So that in itself will pick up sales fast too! Both of casual gamers and of those to be converted from 1 box of warriors to 1 army!

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As an Old Git, I'd prefer they push Path To Glory. Just more fun for me!

   
Made in au
Owns Whole Set of Skullz Techpriests






Versteckt in den Schatten deines Geistes.

 frozenwastes wrote:
"Sales in our Citadel online shop were flat compared to last year and our Forge World and Black Library stores declined slightly at £4.6 million"
Maybe next time don't raise the prices on FW worldwide (except for the UK) and lie to us that you're making it easier/cheaper because of local currency prices, you fething charlatans.

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"GW really needs to understand 'Less is more' when it comes to AoS." - Wha-Mu-077

 
   
Made in de
Battlefield Tourist






Nuremberg

GW has essentially righted the ship it seems to me. Putting out lots of nice miniatures for people to buy, rules which are popular enough, and ways to get miniatures that do not totally break the bank through Start Collecting sets etc.

I still think some of their creative choices are poor, but as a company they are a lot better than they were 4 years ago.

   
Made in us
Major




In a van down by the river

 frozenwastes wrote:
I'm a little surprised that their online engagement isn't translating into online store sales growth. There are product purchase links all over but the online store didn't really experience any growth in sales over the last year (though it did to get to it's current level in previous years since GW embraced using the internet). The low overhead of online sales means that it's easily the most efficient way for GW to make money on the sale of a given kit, but this report, retail and trade grows but online sales don't.


Competition is far stiffer in the online channel and people are often less-inclined to pay retail when they can acquire the identical product from someone in the Trade channel for less. Their retail stores are slightly less prone to that competition factor due to the human aspect of liking things right now and being in the place already; oftentimes the convenience/immediacy makes the extra cost less dear to the consumer. The trade revenues would account for *other* online vendors growing though, which isn't the exclusive source of that growth but still ends up in the pie. So, not terribly surprising that their full-retail, limited-incentive store isn't really showing an increase in sales even though the others are showing it.

Not entirely sure they're all that interested in maximizing that channel though; they seem content with their limited run things at premium prices and letting trade soak up the slightly price-conscious consumer (because even at a discount they're still expensive ).

   
Made in gb
Decrepit Dakkanaut




UK

I wonder what items which are sold online only, but are ordered in-store count as - online or store sales.

That store sales have gone up whilst online has become stable might suggest that people are buying online products in GW stores more often, esp if the purchases count as store buys.

I'd wager the dedicated market buying online and NOT doing it through a local GW store are more likely to use 3rd party stores that offer discount for anything that isn't GW exclusive. So I'd wager GW is seeing steady sales of their exclusive items which is translating into a generally fixed level of online sale. Because once someone is buying online they are far more likely to go to one of the independent stores for discount prices. Considering that they've got to wait for a product to ship anyway it doesn't matter if its GW or a 3rd party in terms of delivery time.


And that isn't a bad thing, in fact so long as GW trades with 3rd party stores its likely to be the norm. GW could be cheeky and start pricing up all their non-exclusive products under that assumption, but at the same time they've got to be careful because many customers (Esp new ones) are going to use the GW store to browse at the products (lets face it their store is really good at that and they've put a lot into product photos and 360 views and they do show real products not 3D renderings).

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Aspirant Tech-Adept




UK

 Overread wrote:
I wonder what items which are sold online only, but are ordered in-store count as - online or store sales.

That store sales have gone up whilst online has become stable might suggest that people are buying online products in GW stores more often, esp if the purchases count as store buys.

I'd wager the dedicated market buying online and NOT doing it through a local GW store are more likely to use 3rd party stores that offer discount for anything that isn't GW exclusive. So I'd wager GW is seeing steady sales of their exclusive items which is translating into a generally fixed level of online sale. Because once someone is buying online they are far more likely to go to one of the independent stores for discount prices. Considering that they've got to wait for a product to ship anyway it doesn't matter if its GW or a 3rd party in terms of delivery time.


And that isn't a bad thing, in fact so long as GW trades with 3rd party stores its likely to be the norm. GW could be cheeky and start pricing up all their non-exclusive products under that assumption, but at the same time they've got to be careful because many customers (Esp new ones) are going to use the GW store to browse at the products (lets face it their store is really good at that and they've put a lot into product photos and 360 views and they do show real products not 3D renderings).


According to my local GW manager, anything paid for in store counts towards the stores sales.

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Columbus, OH

According to my local GW manager, anything paid for in store counts towards the stores sales.


That is correct. However, if the customer orders it online at home and ships to the store for pickup, it doesn't count. It does count for your bonus though, if you hit your targets.

Thanks,

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Commentary from The Grauniad.

Piece from Weyland’s Forge is an interesting tidbit. Dunno if it holds up to wider scrutiny though.

   
Made in gb
Shas'la with Pulse Carbine




Eastern Fringe

It's nice to see that GW has put in yet another strong performance I do think it is about time they revisit their website/store though. It is starting to look very dated, the navigation isn't great and the way the models are organised is a bit of a mess.

The first rule of unarmed combat is: don’t be unarmed. 
   
Made in gb
Decrepit Dakkanaut




UK

 Hollow wrote:
It's nice to see that GW has put in yet another strong performance I do think it is about time they revisit their website/store though. It is starting to look very dated, the navigation isn't great and the way the models are organised is a bit of a mess.


A few tabs need reorganising but honestly I think its in a really good place right now. You can browse very easily by army and by range and pick out what you need from the tabs. AoS is the only area that really needs a proper clean up and that's mostly being done steadily through Battletomes (and their big Christmas cleanup).

I think that one thing they could and should do is take out "boxed games" and instead introduce a two layer bar so that under 40K you've got Killteam etc... A second row to advertise their other games. Right now Necromunda and Adepticus Tianicus and Bloodbowl and others are all "hidden" under boxed games.

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