Where Main Street Meets Wall Street

Games Workshop tumbles as increased costs and unhelpful forex movements take their toll

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A bright spot in the trading statement was the sharp increase in licensing income

Games Working Group PLC, the table-top science fiction and fantasy-themed miniatures wargaming company, saw its shares (war)hammered after a disappointing trading update.

The shares tumbled 6.5% to 9,130p after the company said sales in the six months to 28 November would be not less than £190mln, up from £186.8mln in the corresponding period of 2020, while profit before tax is expected to be at least £86mln, suggesting profits would be down on last year’s half-year number of £91.6mln.

“Our operating profit-pre royalties receivable is estimated to be down c.£15 million; however, excluding foreign exchange movements, increased carriage costs and the costs of paying more to our great staff, our core business operating profit is broadly in line with last year’s exceptional performance,” the company said.

Generally speaking, companies use the term “broadly in line” when trading is not quite hitting the expected mark, although the munchkin gamers’ favourite company did say that it had been trading in line with expectations since its September trading update.

Licensing income has increased to around £19mln from £8.7mln, driven by significant computer game licensing deals with Nexon and other major licensees. The related guarantee income is recognised on signing the contract in line with its usual accounting policy.



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