Friday, January 10, 2014

GW is actually doing well financially ... despite the endless predition of their impending doom!

Games Workshop doing ok financially? Inconceivable!!
So to start I am not really a lover of all things GW anymore.  I have to be honest that I have been selling off large quantities of my once vast GW collection.  That said GW will always hold a special place in my heart.  Warhammer 40k was my first mini gaming experience and I entered gaming in general mainly through tabletop war gaming.  So I have an endless amount of nostalgia for GW stuff and many happy memories, etc.  I have also done my share of ranting and complaining.  Just this week with the announcement of the end of White Dwarf ... I was shocked and even angered a little bit.  White Dwarf has been in publication since 1977, HOW DARE they nuke such a venerable old warhorse of a magazine for NO reason.  TO what make a new magazine called "Warhammer Visions" (seriously??) ... huh?  Why??  See.  I can rant with the best of em.  But seriously GW is not about to go out of business in fact nothing could be further from the truth. 

Ok so I finally had a chance to look at GWs annual report for 2013 (LINK). Here is my executive executive summary of an already greatly abridge report.

In short. GW is doing fine. Actually quite arguably better than ever.

*Revenue is up, but only slightly at 134 million pounds vs. 131 in 2012.

*Pre-tax profit 21.4 million pounds up from 19.4

*Dividends have fallen to 58 pence down from 64 last year (this is an indicator of note, that isn't necessarily bad but it shows they aren't going super gang busters this year either otherwise it would have likely gone up).

*Royalties have taken a hit due to few video games in 2012. That said their TOTAL royalties is in a good year only around 3 million pounds and that INCLUDES all the FFG stuff, ALL video games, etc. So they never were making as much from that as many people think.

*Expansion continues, revenue from expansion hasn't been great but they seem to be rebounding in some markets (like Japan) and holding on in most markets. North America has actually been a bright spot, and Europe and the UK were somewhat stagnant this past year.

My overall assessment is that GW is in a solid position in the short term but still faces long term uncertainty. They are not leveraging their IP as strongly as they might and their costs are where they stand to make the most gains.

For GW their pricing model just really is nearly unique in the world of business, they operate in a market with no real direct competition. I agree with Kirby's assessment that in terms of competition they have little because their product quality is far superior to nearly any competitor of note. Substitute goods do exist, but their core audience is reluctant to use them. Certainly I think this has been changing, but as is demonstrated by GWs numbers that fact has not eroded away their base. They are still making decent profits and are far from being on the verge of financial collapse as one might think given the endless internet ranting.

I myself have done my fair share. But when you look at their numbers, GW isn't going anywhere anytime in the next year or two. Things change fast these days though so who knows what their long term perspective is.

On a side note has anyone ever looked at GWs real estate section on their website? Kinda cool LINK

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