Kudos to Geek Native for their article on how GW is coping with a recession. It piqued my curiosity so i had a look at the source material. After a little look through the statements it can be said that whatever we think of Games Workshop they are doing well during a bad time.
In a press release, Mark Wells, CEO of Games Workshop, said:
“An encouraging first half performance in which we have delivered growth in sales, profit and return on capital from our core business. Good progress has been made on our strategic initiatives; these are beginning to show through in results from our Hobby centres. We also received a significant royalty payment which has been recognised in the first half. In line with our policy of distributing truly surplus cash, we are pleased to report that the board is declaring a dividend of 29p per share.
The Press Release also went on to say
As a niche business, we, in general terms, neither benefit nor suffer from macro economic factors as our current results show. The Hobby is healthy and the challenge is to stay focused on what needs to be done to service it efficiently and cost effectively. The principal risks and uncertainties for the balance of the year lie in the ability of the sales businesses to establish or maintain sales growth and for the product development and manufacturing operation to maintain gross margin. Games Workshop‟s core business model remains strong. The initiatives we have implemented in the sales businesses are designed to lead to higher volumes whilst maintaining hard won efficiencies. The board remains confident in the future growth and profitability of the Group.
Operating profit in Australia and Asia continues to be in the red, worse than the previous years but they are beginning to have a nice boost from royalties from the likes of THQ who have a licencing agreement up to 2020.
It would be interesting to see how much the whole hobby industry is worth. Hmmm, now there is a challenge.