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Toofast wrote:
Hopefully this will show them that they can't just keep cutting costs without doing something to increase revenue. Their magic plan to increase revenue is just to raise prices, making some people spend the same amount and just get less models, and making other people quit. It's not as bad as a lot of people thought it would be, but they need to do something about it soon.

What I find worrying is the possibility that they (i.e Kirby) are either too stubborn to change their strategy, or (even worse) simply don't even know how to adequately turn things around in time.

Given they do no market research, they probably have no idea what is going wrong on the sales front, so they won't be able to correct it.

Given they are proud of that position, they are unlikely to even want to change course before they hit a major problem.

The 7% drop in sales while painful probably can be satisfactorily explained away by the GW hive mind.

 Kilkrazy wrote:

 BlaxicanX wrote:
I don't know gak about economics or money.

Can someone summarize the important parts of the report, in laymen's terms?

It will take some time to read through everything and make a good evaluation.

The headline item, though, is that sales are down 7% compared to last year, which is the worst performance since 2005-6.

Down 8.2 percent, actually.

Post-tax profit is down 50 percent.

Trade sales (sales to independent retailers) is down 9 percent.

Other sales businesses (FW, BL, WHW, and Digital Editions) is up 20 percent, but IIRC Digital Editions is a new addition.

We probably calculated from different figures, however the crucial point is that sales overall are significantly down.

I didn't calculate, I just quoted the report (p.6, under 'Sales').

The best part about the entire thing, however, is that someone royally screwed GW over with the website. I want to give the guys who did this a medal.

I had betted on 10% so I only missed by 1,8%!

 BlaxicanX wrote:
Well, another way to look at it is that the death of Games Workshop isn't the death of 40K.

That's partially why I kind of want GW to tank, honestly. Even if they go, the chances are good that another company is going to either absorb GW or at least scoop up 40K, because any smart business can see the value in the IP. 40K was the premiere, leading brand of Wargaming for a long time, and has a built-in, loyal fanbase despite GW's treatment of them. There is a lot of potential to turn that IP into something much bigger, with the right business practices, and a smart company will know that.

So the death of Games Workshop could be the birth of 40K getting the care it deserves.

Not to get all doom and gloomy in here. I think GW has at least another half-decade or so of life left in it- but if it doesn't make radical changes to its business model, to emphasize customer growth rather than merely expense reductions, it won't have a chance.

I agree entirely. I think one of the best things that could happen to the 40K IP is if Games Workshop no longer was at the helm. I have literally seen 40K go from a hobby that was in every FLGS in my area, to a handful that barely support it anymore. The entry cost of the hobby is no longer realistic. I've tried to get people interested in it, but how can I justify them spending several hundred dollars to play a tabletop game when there are so many other alternatives? I'm not even talking about things like Warmachine etc. I have just as much fun playing board games like Zombicide or Arkham Horror etc that cost a fraction of what 40K does.

Well it turns out that a Mrs Kirby was head of IT (on £117k/year), so would have been involved in the decision.

Having gone back to calculate the sales drop from the figures given on P.32, it was 9%.

(123.5/134.6)

Anyway, whether 7%, 8% or 9%, I think we would all agree that it is not desirable for sales to decline.

Indeed.

Honestly I dunno what's more distressing, the data, or GW's response to the data.

Because honestly... I'm not exactly dancing at this news- I doubt many people are. It would be preferable for GW to not go under, and for tons of people to not lose their jobs...

It would be preferable if they could just pull their heads out of their asses. lol

 jonolikespie wrote:
All that, in addition to the lovely custom tables being swapped out for realm of battle with only scenery made from GW kits, was genuinely depressing to see.

That's the tragic part. A world of interesting and varied terrain all replaced by homogenised, sanctioned and sterile Official™ Citadel™ Terrain™.

The shares chat is interesting, as to what shareholders are thinking.

http://www.lse.co.uk/ShareChat.asp?page=1&ShareTicker=GAW
Fagen39
Hi OGB,
It was all good with these shares (I have been holding since Jan 12) they held up well during the recession (due to consumer loyalty) and paid a cracking dividend (which is the main driver of the good share price). The recent knock was becuase share holders through that due to poor operating performance the divi would be at risk which was then swiftly dealt with by the 20p divi announcement.
If operating issues can be stabalised then the share price will continue to grow back to +20% from the current position. The main worry for me is the strategic direction of the business. They do not appear to be moving quickly enough with modern times and modern consumers:
- Their books are not on kindle (or any other e-reader)
- They are not proactively managing the worries around 3d printing replacing their products
- They are not interacting with their consumers in the right way e.g. focusing on video clips to build characters, , films, facebook, twitter, etc.....

Their products are only going to seem more expensive without the advertising support.
Imagine 3D printing a Space Marine commander with your head and printing him up ready for battle.

So not a conclusing 'buy' recommendation but I am still going to hold for a while longer.

OldGasBag
Hi everyone!! I popped into my local games workshop store today for the first time in 20 years and I was shocked that the prices they charge these days and also the very limited lines/products which they produce these days. Granted it is 20 years since I last bought any GW products but I can't be the only one that remembers all those great board games blood bowl, Talisman etc...Why don't they increase there product lines bring back the old favorites surely that would help. Anyway walking through those doors has made me all nostalgic so its E Bay for me. Might even buy a few shares if I can get up to pace with whats going on here. Anyone care to summarise what life is like as a GAW share holder. Thx in advance...

Don't think the report has hit home yet.

 Kilkrazy wrote:
Having gone back to calculate the sales drop from the figures given on P.32, it was 9%.

(123.5/134.6)

Anyway, whether 7%, 8% or 9%, I think we would all agree that it is not desirable for sales to decline.

This is how Google told me to do maths:

= ((123.5 - 134.6) / |134.6|) * 100
= (-11.1 / 134.6) * 100
= -0.082467 * 100
= -8.2467% change

= 8.2467% decrease

 Kilkrazy wrote:
I think we would all agree that it is not desirable for sales to decline.

Depends on your perspective - I, personally, welcome any drop in sales GW has to suffer.

 Thud wrote:

 Kilkrazy wrote:
Having gone back to calculate the sales drop from the figures given on P.32, it was 9%.

(123.5/134.6)

Anyway, whether 7%, 8% or 9%, I think we would all agree that it is not desirable for sales to decline.

This is how Google told me to do maths:

= ((123.5 - 134.6) / |134.6|) * 100
= (-11.1 / 134.6) * 100
= -0.082467 * 100
= -8.2467% change

= 8.2467% decrease

It's the same thing...

(123.5 - 134.6) / (134.6) = (123.5/134.6) - (134.6/134.6) = (123.5/134.6) - (1) = 0.9175 - 1

Killkrazy just calculated the 0.9175 but must have made an error in rounding and called it 0.91 and then 0.91 - 1 = -9% when it should have been -8.25%. Either that or mistakenly though the 0.9175 was the 9%, when it actually means that 123.5 is 91.75% of 134.6

Posted on GW tread at share site http://www.lse.co.uk/ShareChat.asp?page=1&ShareTicker=GAW
c4darkmane
http://investor.games-workshop.com/wp-content/uploads/2014/07/2013-14-Press-statement-final-website.pdf

reading this i feel they have their head in the sand, further more they dont appear to acknowledge the competition, yes they are the only people who make their branded items, however a portion of their community is made up of people who like strategy tabletop games and will jump ship if another producer has a better game. with that in mind both Privateer Press and Fantasy Flight have been gaining market share. then we have people who will play the game but by models either from the 2nd hand market or go to companies who make similar looking models and in some cases better quality or more unique looking figures.
Kickstarter has funded a large amount of miniatures games over the last year and while they may not last, they buzz created by these launches could be drawing attention away from Games Workshop. One company Mantic have been quiet successfully using kickstarter for their miniature games, acting almost as a pre-order system which could minimise losses by gauging the appeal of the product before they go into full production.

Hi Fagen39, while i agree with everything else youve posted, in defence of GamesWorkshop they do produce e-books both for their novels and rules of the game for a variety of operating systems, however they seem quiet expensive.

Oldgasbag yes in the store they have cut back on their IP to only 3 ranges of which Lord of the Rings seems to be slowly falling away in popularity. however they licences out to fantasyflight the rights to produce roleplay books and boardgames.

i wonder what the future holds.

Share price holding, down 15p (2%) on very light trading. No large trades so far so the institutional investors seem to be sitting still for now.

 Kilkrazy wrote:
We probably calculated from different figures, however the crucial point is that sales overall are significantly down.

Despite some easy frags on our wallets : Imperial Knights, 7th edition...

The next financial report will be dreadful.

Litcheur wrote:

 Kilkrazy wrote:
We probably calculated from different figures, however the crucial point is that sales overall are significantly down.

Despite some easy frags on our wallets : Imperial Knights, 7th edition...

The next financial report will be dreadful.

I think 7th hasn't been the trump card GW thought it would be. Sales were most likely low due to the halved lifespan of 6th souring a LOT of customers (I don't really know many who own it even now) coupled with yet an even higher price for the book.

However, the full effects of this release will be born out over the next year, as many customers refusing to buy a new rulebook means there be a chain reaction of decreasing sales in 40k products.

I don't see GW digging themselves out of this without turning into an entirely different company.

With all the big releases we've seen this year, its not a good sign their revenue still managed to shrink.

They're still making money, and they still have money in the bank, but it looks like their customer base has and is continuing to shrink faster than they can plug the holes with marines and knights.

I'm not hopeful for GW's future if they keep on their current path.

 Accolade wrote:

Litcheur wrote:

 Kilkrazy wrote:
We probably calculated from different figures, however the crucial point is that sales overall are significantly down.

Despite some easy frags on our wallets : Imperial Knights, 7th edition...

The next financial report will be dreadful.

I think 7th hasn't been the trump card GW thought it would be. Sales were most likely low due to the halved lifespan of 6th souring a LOT of customers (I don't really know many who own it even now) coupled with yet an even higher price for the book.

However, the full effects of this release will be born out over the next year, as many customers refusing to buy a new rulebook means there be a chain reaction of decreasing sales in 40k products.

I don't see GW digging themselves out of this without turning into an entirely different company.

I think many customers also weren't willing to pay for the big set of rulebooks like GW planned. I think, at this stage, far more customers were willing to wait for the boxed set to come out and just get a mini-rulebook from that (quite possibly from ebay).

The more I read the only thing I can hear is
"This is your pilot, Captain Kirby, speaking. Just wanted to let everyone know that I had the landing gear removed and jettisoned all the fuel to reduce the weight. Smooth sailing ahead."


Automatically Appended Next Post:
I just can't wrap my head around this. How can someone think like this.
"They'll buy what we make"
Except sales are down! You're making and they aren't buying. Why don't you see why they aren't buying in an industry that's growing?
"We are trying to open more stores in the USA"
Why? How does that fix anything? 58% of sales were from independent stores in the US and you're trying to put more stores in there to build up more cost and attempt to take sales away from independent stores. How is viewing stores that purchase bulk product as a competitor you want to steal sales from a good thing?!

I remember Dakkanauts like HBMC speaking of GW, saying things like "we don't make what they want, they buy what me make." I didn't believe I would see Tom Kirby saying the exact same thing.

Yes, there certainly are various elements of GW's behaviour that seem logically contradictory.

I certainly agree that a lot more people would have bought the 7th edition rules if GW had released the rulebook only, prices say £20 or more likely £25, as an option to the whole set at £50.

I agree KK.

My position was as such:

I bought the limited 6th ed. Collector's rulebook. Finding it invalidate in only two years, I was really quite angry about this change in cycle- it felt super disingenuous and all collector's items since this time have felt to me as having no real value.

Seeing 7th come out at a price even higher than 6th made me decide to halt any future rule book purchases. I have since been exploring the option of playing a previous edition because I still very much enjoy my models, but my purchasing has dropped to near-zero. Which is surprising to me still; I've been buying models since 3rd and the stop has nothing to do with a diminishing interest...it's all about the feeling of exploitation on GW's part.

 Accolade wrote:
I remember Dakkanauts like HBMC speaking of GW, saying things like "we don't make what they want, they buy what me make." I didn't believe I would see Tom Kirby saying the exact same thing.

The letter from Kirby would have me extremely worried if I were an investor. It was poorly and unprofessionally written and did nothing but try and deflect criticism instead of talking about any strength.

You can colour me annoyed by the whole new rulebook thing too. I bought into 6th but 7th, not so much. Why buy a new rulebook that might be invalidated again so soon?

AllSeeingSkink wrote:

 Accolade wrote:
I remember Dakkanauts like HBMC speaking of GW, saying things like "we don't make what they want, they buy what me make." I didn't believe I would see Tom Kirby saying the exact same thing.

The letter from Kirby would have me extremely worried if I were an investor. It was poorly and unprofessionally written and did nothing but try and deflect criticism instead of talking about any strength.

The whole comment about hiring based on attitude and not ability really scared me. It sounds like he enjoys being surrounded by Yes Men. If only the investors and customers could see things the way that people he pays to agree with him see things.

 Savageconvoy wrote:

AllSeeingSkink wrote:

 Accolade wrote:
I remember Dakkanauts like HBMC speaking of GW, saying things like "we don't make what they want, they buy what me make." I didn't believe I would see Tom Kirby saying the exact same thing.

The letter from Kirby would have me extremely worried if I were an investor. It was poorly and unprofessionally written and did nothing but try and deflect criticism instead of talking about any strength.

The whole comment about hiring based on attitude and not ability really scared me. It sounds like he enjoys being surrounded by Yes Men. If only the investors and customers could see things the way that people he pays to agree with him see things.

He didn't get where he is today by ability. so it's not surprising really.