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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.