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GW's stock price has rebounded over mid to late July, making up for losses since January. This is a major shift in value over a relatively short period of time, at least in the context of the short term (less than a year). Good news for GW corporate, anyway. Here's the chart: www.lse.co.uk/ShareChart.asp

Any idea what prompted this?

WFB 7th ed. That and the Warhammer online game.

Darrian

Three words: Dead Cat Bounce

Must be those amazing FAQs inspiring confidence in the investors.

Year end financials were released and while profits slumped, some saw prospects for a rebound and/or long term growth opportunities. Also, Kirby bought up some 63,000 shares too, which probably had something to do with it. The stock may be the highest it's been in over six months, but when taking a long look at it one has to go back five years to see it doing as poorly as it is now. Over the next few months I expect for it to return to it's backsliding unless some sort of financial miracle occurs and customers begin flocking back and I don't think WHFB v7 and Eldar aren't going to do it.

Posted By mauleed on 08/21/2006 1:37 PM
Must be those amazing FAQs inspiring confidence in the investors.

LOL! 

He...used...sarcasam.

When you've hit rock bottom, there's only one way to go - up, up, up!

The buyback of shares will instill some investor confidence, As you know, GW has a broad range of releases for the fourth quarter that guarantees continued growth, if only in the short go. Steampunk Russians, Euros and Arabs and that oddly arousing stuff from Frenchie McCroissant doesn't even come close to GW's awesomeness.

And that's a damn fact.

I think its based on GW slashing overhead...i could be mistaken though.

Posted By mauleed on 08/21/2006 1:37 PM
Must be those amazing FAQs inspiring confidence in the investors.

I lot of investers play Tyranids, since they can relate to the 'devour everything, strip it bare, move on, rinse repeat' methodology. With news that their Warriors and Zoeps won't be instakilled inspired their confidence!

Well, if I had the cash to do so, I would have bought as much as I could if the stock hit 225. It never did, but that didnt stop alot of other people from buying a stock that has a good potential worth.

If I bought the stock last month, at 225, I would dump it all right now for the nearly 400 it is right now. Just for the cash.
Long term investment in a company I have no respect for, or any faith in their business model, is a sign of stupidity.

I think that 2112's assessment of the "dead cat bounce" is very accurate. "A temporary recovery from a prolonged decline or bear market after which the market continues to fall."

I really dont have faith in the stock rising above 500, I think by the time january hits, after the christmas shopping season, the stock will go into a slow downward spiral once again.

If they actually fix their rule set....they might actually be a decent company. The cost is still too prohibitive for any newcomers in this economy right now though. Which is the main reason I doubt the stock will rise very high.

"If they actually fix their rule set....they might actually be a decent company. The cost is still too prohibitive for any newcomers in this economy right now though. Which is the main reason I doubt the stock will rise very high."

Keep in mind for a serious discussion on this topic the quality of their rules is only a small compenant of the company's value. the only way it affects stock is by how rules quality influences sales (not much from what I've seen and I've been around since rogue trader).

If GW announced a movie deal tomorrow they could change the entire rule set to d6 it and stock would still go through the roof.

Posted By Kid_Kyoto on 08/22/2006 8:48 PM

If GW announced a movie deal tomorrow they could change the entire rule set to d6 it and stock would still go through the roof.

Exalt.

Posted By Kid_Kyoto on 08/22/2006 8:48 PM
If GW announced a movie deal tomorrow they could change the entire rule set to d6 it and stock would still go through the roof.

Very good point.

Someone on another board (who does this stuff for a living) pointed out why the stock jumped.

GW announced a stock buyback program, which has inflated share price.

Basically, they're buying their own stock, which has artificially increased demand, and hence price. Basically they're bleeding more money to send the price up.

They also had to borrow money to pay the dividends, which is a bad, bad thing since it sets up a debt spiral. I really think we are going to see GW take a major punch to the face this year. Their business practices continue to be consumer un-friendly, repetive price hikes, the worst rules support ever in the history of the company, more mass-prodced, soft-detail sculpts (both in plastics and metals), etc... All of which does not paint a good outlook for them. WHFBv7, O&G and Eldar are not going to save their goat.

Two other execs besides Kirby have joined in as well, but I hadn't seen any listings for a company sponsered buyback. Remember also this is a low trade volume stock, so a major move by anyone is going to have an effect. Besides that theres the dividend payout. heres a few scenarios that come to mind:

1. Kirby and Co are confident that the new releases, price increases and holiday season will drag the stock back up.
2. Kirby and Co are afraid of devalued stock so wish to increase it for whatever reason.
3. Kirby and Co are inflating the price in expectation of a takeover bid.

all three are very possible. the quarterly report was to my mind very mixed, and not nearly as optomistic as Kirby tried to indicate, nor have recent releases made up for shrinking market; and theres no reason to expect upcomign ones will be differnt. I give more weight to two and three, though Kirby is an optimist and could be banking on paying off debt in a later quarter. Typically though, taking on debt to try and increase stock value by paying a dividend is a move wise investors are VERY wary of and is often a sign of weak management.

one of the fact in the last financial report was that it was a lot worst than the final number shows because in the last month where the tau were launch the sales have began to go up. How many of those analyst see the last month of sales going up the bottom of the barrel reached for GW I am not sure about it.

Tuesday, 25th July 2006 09:56
LONDON (AFX) - Games Workshop Group PLC, the fantasy figurines group, reported a 73 pct slump in full-year profit but maintained its dividend, which is not covered by earnings, as it reckons prospects are still good, sending its shares over 2 pct higher.

'In the short term our trading prospects remain challenging,' said chairman and chief executive Tom Kirby.

'Throughout spring 2006 our year-on-year performance has been improving and ... by the end of the year our Games Workshop Hobby stores in seven of our nine sales territories, including both the US and the UK -- our two largest businesses -- were recording growth,' he said.

'We believe that the business is now returning to growth. With 42 pct of our sales made to independent retailers, however, 'calling the turn' is difficult.'

For the year to May 28 the group, which in addition to serving independent retailers trades from 337 Games Workshop Hobby stores worldwide and direct, through the internet and mail order, made a pretax profit of 3.7 mln stg, down from 13.9 mln stg last time, on revenue down 16 pct to 115.2 mln stg -- a performance broadly in line with analysts' expectations following a January profit warning.

It said sales and profits fell for two main reasons -- firstly, the continuing decline in sales following an exceptional trading period, and secondly, the continued reduction in sales to independent toy and hobby retailers, notably in the US, where many smaller independent operators are ceasing to trade.

Despite the hefty profit fall the group maintained its final dividend of 14.025 pence and its full-year payout of 18.975 pence. However, this is not covered by earnings per share of 6.5 pence, down from 29.4 pence.

'Despite the short-term difficulties of this year, we remain confident that the Hobby is in good health. In addition we have come to the end of our investment programme, which leaves the business seriously well invested,' said Kirby. 'The directors believe the prospects for the business remain very good.'

In the long term, the CEO reckons the group should be able to achieve similar levels of sales penetration in each of its markets to those it currently has in the UK.

'Achieving this would at least treble the current level of our sales,' he said.

Having cut costs, re-trained staff and started the process of re-establishing normal product life cycles the group reckons it is now in much better shape.

In the first half of the year it reported a sales decline of 20 pct due to the bursting of the Lord of the Rings 'bubble', in the second half this decline slowed to 12 pct.

Despite lower production volumes due to the decline in sales, the group was able to improve its gross profit margin to 70 pct -- the result of price rises, improved operational efficiency from manufacturing facilities in Nottingham and Memphis, and more cost effective sourcing of bought-in components and print from Europe and Asia.

Additionally, Games Workshop reduced overheads by 2.8 mln stg during the year, despite increasing expenditure on customer facing activities including a net increase of 10 new Hobby stores since May 2005.

By 9.16 am shares in Games Workshop were up 7 pence at 298 pence, valuing the business at 93 mln stg.
Games Workshop FY profit slumps 73 pct but upbeat on prospects UPDATE

Bridgewell Securities retained its 'neutral' stance, arguing the results contain ammunition for both bulls and bears.

[There's] 'no definitive evidence of the turn yet encouraging year-on-year improvements in many parts of the business, continued question marks over visibility yet a robust maintenance of the dividend,' it said.

james.davey@afxnews


Monday, 31st July 2006 10:36

CEO and chairman Tom Kirby lifts stake in Games Workshop Group to 6.1 pct

LONDON (AFX) - Games Workshop Group PLC said that on July 28 CEO and chairman Tom Kirby bought 63,000 shares at 344.1 pence each, taking his total stake to 1.905 mln shares, or about 6.1 pct of the company.

The company said finance director Michael Sherwin bought 11,500 shares at the same, taking his total interest in the company to 77,168 shares, or about 0.25 pct of the issued share capital.

newsdesk@afxnews.com

I heard Ebay is now charging large somes for Ebay stores forcing many to close (good for the LGS) that might have helped some..

If anything, it will hurt them. they are already starting to see the impact of the loss of independant retailers in the US, and only great fools will be happy at the loss of outlets of sales. You WANT your product on the market, in the open, not hidden away. Although GW thinks the UK sales model will work in the US, its a far differnt enviroment and GW refuses to acknowledge this, thinking their few shops will cover vast areas and that their online store will attract everyone else, which is an attitude that alienates a lot of players and potential players.

I don't know, I think the idea that forcing eBay stores closed being a good thing for LFGS is a fallacy, as are any other attempts to control or blame the lack of a stores profitability on the "internet". Especially considering large swathes of the US (and other countries I'm sure too) don't have a LFGS, much less any game stores within reasonable driving distance. Even areas that do it doesn't mean those stores are worth shopping at. There is a GW store, a LFGS and a HobbytownUSA all in relatively close proximity to me, but I still have to do the bulk of my purchasing online as none of those stores neither carry nor are willing to order (or capable of ordering) what I want (FoW, Rackham, various historicals) and GW prices are too ridiculous for me to consider purchasing without a heavy discount.


ps. Don't get me wrong, I do prefer shopping at LFGS, provided they earn my loyalty. Before I moved to my current location, almost 90% of my purchases were through the LFGS I frequented in NoVA. It was also where I gamed at, and the shop owner and other regulars were instrumental in getting me interested in other stuff, like 15mm and 25mm historicals. There just isn't anything like that LFGS here, unfortunately.