"GW: Improving sales and profits" Topic

Games Workshop (LSE: GAW.L – news) on Friday posted improved sales and profits in the first half on the back of strong performance…

link

Good for them. Them doing well certainly isn't going to hurt the rest of the hobby.

Good, maybe they can bring back some of their 6mm LOTR armies.

From the article:

"Kirby will step in as Acting Chief Executive while the company finds a replacement for Mark Wells who resigns as boss after five years."

Replacement? It sounded like they were getting rid of the CEO position.

Good, maybe they can bring back some of their 6mm LOTR armies.

?? AFAIK BoFA was 10mm.

Yup 10mm.

The 6mm stuff was the mass battle WH40k game.

Umm,

I'm thinking Teen-Titans, but I know that's not right.

I'm pretty sure this can't be true. I've seen a number of posts on the pages of this very website that said things like GW is nuts for putting out a $75 USD rulebook for one of their flagship games. Also people have claimed that no one but the fan boys would buy the finecast models that have come out. I've also read a number of people post that GW is in a downward spiral and that the end is nigh for the company.

After all that compelling evidence over the last 12 years or so it would be impossible to even comprehend that GW isn't just on their last legs, much less seeing growth and increased profits.

Actually, I'd like to see a more in depth report before commenting about how well they are doing. There is a mention about reduction of expenses. That can mean certain things too. Deducting their expense reduction from their profitability shows a net profit increase of 3.4 million. How much of that was due to price increases and what were comp sales? That plus some other info would provide a clearer picture of how well they are doing.

You'll notice that the share value actually dropped based on their report. That says something too.

Thanks,

John

Well, their stock is up about 26% over a year ago, and has a very nice upward trend for the past several years, with the usual small spikes and drops. Price is 660 a share. Recommendations are a buy on the stock. So overall it looks pretty good for the company and investors. Shame I couldn't buy it several years ago.

In Spain, they are closing shops… nope… actually what they are doing is firing most of the staff and replacing 3-staff shops by 1 man shop. Therefore, they are cutting a lot of expenses (salaries, rent, ecc). On the other hand, they are supporting on-line shops, a la Wayland, which will sustain the sales thanks to huge discounts on GW product.

According inside sources at GW HQ in Barcelona, the sales on W40K are going very strong, but The Hobbit hasn't worked as expected, and WFB is in free-fall.

On the other hand, the article doesn't say that GW has improved their sales in terms of units sold, but that the income from sales has rised in 5 million GBP in 4Q 2012, compared with the same period in 2011. This increase represents a 8% higher, but the prices of their products, comparing both periods, have rised more than the said 8%, which means that they have, probably, lost customers in between. If I would be an investor, I would be asking myself: how much can they rise the prices before their potential customer base collapses? How much operating costs can they still cut?

Ah don't know ? From what I hear, a lot of gamers, here, have dumped GW for Malifaux and one or two other systems due to price ?

My local store in Milwaukee has lost most of its 40k players to Warmahordes. He didnt losse any WFB players because there arent any.

Meanwhile in Maryland there's a ton of 40k gaming on-going every week.

I don't play GW's stuff any more.
I play FoW, Bolt Action and Kings of War so at least I have to bring 2 armies for every non-40k game I try to get a pick-up game for :)

I just found a use of the term 'Space Marine' dated to 1955 via the Project Guttenberg SF collection. So GW does not have a water tight claim of copyright on the term, although they probably could make it a trade mark, but that is more expensive due to having to register in multiple jurisdictions.

"According inside sources at GW HQ in Barcelona, the sales on W40K are going very strong, but The Hobbit hasn't worked as expected, and WFB is in free-fall. "

Well to say that anything is doing well in an economy with 25% unemployment would seem to argue in favour of the company doing very well actually.

Don't bother, Pictors. Someone's preconceived opinions or undocumented anecdotal rumors trump silly things like "data" or "facts".

It still puzzles me that some folks gleefully anticipate the downfall of a minis company. Baffling.

Well to say that anything is doing well in an economy with 25% unemployment would seem to argue in favour of the company doing very well actually.

Yes, that's correct. Now, the challenge is sustaining it. Problem with many companies in the current economy, and not only for GW, is that once you cut all the expenses you can and rise the prices to the limit your customers are willing to pay for your product, you, as CEO, need to sustain steady profits for your investors. That's the tricky part. Where to cut? How much can you rise prices before your customer base collapses? Those are the questions that GW's management need to answer.

Don't bother, Pictors. Someone's preconceived opinions or undocumented anecdotal rumors trump silly things like "data" or "facts".

It still puzzles me that some folks gleefully anticipate the downfall of a minis company. Baffling.

Well, that's not my case. I, for one, would hate GW's downfall. Between my eldest son and I we have 8 40K forces collected and we game with them regularly. I like the game, and the background they have built around it. As retailer I don't like their commercial policies, but as gamer I enjoy their product.

My post is an interpretation of the news link posted by our esteemed Editor. If that interpretation is wrong, please prove where I did it wrong, instead assuming I am some kind of GW hater (whom I am not).

It is a fair point, because we have seen it in corporate profit/revenue statements in general for last several years, that an increase in profit may NOT be from better revenue but merely from cutting expenses even while top line revenue is actually decreasing. This phenomena has been the worry of the stock market pickets for several years now in the US--profits are strong but revenues are not growing, just that companies are slashing expenses to the bone. At some point, revenue has to increase for the company to grow because you can only slash spending so much.

GW has been in the process of two major initiatives--moving out of shopping malls (here in the US, anyway) and switching to the one-man store from the multiple-employee model. That clearly will show savings and increase profits as long as sales do not deteriorate at the same time. But, go out another year or three, and the sales will need to increase or else the verdict will be that they have a problem.

Here, where I live, it appears 40k is doing fine, WFB seems a bit wobbly, and LOTR was limping along and it is not clear the Hobbit will revive it. I think it is a little too early for a verdict on the Hobbit, given how few releases there actually have been to date.

Sorry, basileus, I see where it looks like I'm referring to you and that wasn't my intent: I apologize for that. I was thinking about the innumerable threads here where the haters come out of the woodwork on these subjects.

No problem, darth. I know that many nuances of an actual conversation are lost, in Internet. I hope I didn't sound too harsh in my answer; it wasn't my intention either.

Not at all. :)

Locally speaking, the store in Chester has moved from the extreme east end of the main shopping area to the west end. Haven't been into the new store as I don't need anything so I can't comment on the floor space but rental cost per sq ft are likely to be higher there.

GW employees regular people, I have no desire to see GW fail and make these folks jobless.
That could lead to homelessness and family breakups, and from there who knows what.

GW is doing well and good on them.

I'm also no GW hater. I think they bring a lot of visibility to the Hobby and an entry portal for new folks. I simply don't know based on the little info provided what to make of that report. There simply isn't much concrete info of the big picture to make any serious determination.

Personally, I'd find it tough to be a publicly traded hobby company. Each quarter stock holders want continual positive growth and profit. Frankly, that model is not sustainable once a Company has reached a certain level of sales/growth. This doesn't apply to only GW. The new view taken by many Entrepreneurs is to remain private and call your own shots rather than answering to shareholders.

Thanks,

John

The new view taken by many Entrepreneurs is to remain private and call your own shots rather than answering to shareholders.

Indeed.
Quite a few also now advocate selling and using the money to start a new venture.

Say that to the guys at the LA Battle Bunker which is getting downsized to a 1 man store in a month. Heck we Chicagolanders are worried the same thing will happen to the Chicago Bunker as well.

Well when you increase prices by 10-20% your profits are more than likely to go up.

Lets see about the new Dark Angels.

Regular Codex $50 USD for something that should be around $23. USD

Oh you can get the Collector Edition for nearly double that amount.

You can also get at $12 USD each a box of 5 plastic Terminators for $60. USD

Then there is the new flyer for $75 USD and the new speeder for $65. USD

Yup, I can see why their profits are up.

they finally broke my back on the pricing with the Hobbit release. At this point the only thing I'm going to get are the Army specific Magic Cards which they STUPIDLY make Limited Edition.