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View Full Version : Games Workshop's stock loses 24% value today. It has begun.



Zaphod Beeblebrox
01-16-2014, 10:06 AM
Hi guys!

Many of you know our epic series about the "Future of Games Days and Games Workshop".
So far 8 parts have been written in this epic wall of text series, and today, sadly, some of the predictions of the first few parts came true...

Games Workshop lost 24% of stock value today.
Turnover for the half year is down by 12%, profit by roughly 30%.

The facts are in the lines above. The rest can be read here (http://masterminis.blogspot.de/2014/01/the-future-of-games-days-games.html).

If you know the epic length of our articles, you will understand that I will link to my blog here instead of copy/pasting the whole wall. Reading all 8 parts will probably take you a few hours.

SHARE & ENJOY!

Zaphod

Wolfshade
01-16-2014, 10:30 AM
As of replying the drop has increased to 24.9%. To put this in context the FTSE-All Share is down marginally.

It isn't that bad when you look at it, the drop in Profit is about £4m, which is identical to the drop in royalties, in fact discounting royalties from 2012 to 2013 figures they are actually up £.6m on the previous year.

It was always going to be known that the royalties would decrease from the massively popular DoWII splash being over, yes Space Marine did well but sold much less units.

But it is a growing concern that this is the second 6month statement where sales have fallen.

The sales business has actually been more profitable across the regions, bar UK and Europe, where the big dip is in the elusive "Product and supply" segment, which has seen profits tumble.

Also of not is that the business costs have decreased slightly.

Hmm this might take more than just a couple minute skim to claim that GW don't know what they are doing.

Bigred
01-16-2014, 11:26 AM
Games Workshop 2013 Interim 6-month Financial Report (http://investor.games-workshop.com/wp-content/uploads/2014/01/2013-14-Press-statement-final-released.pdf) (January 16 2014)

Year per year revenue down 12%
Year per year profit down 31%


INTERIM MANAGEMENT REPORT

First half performance
Sales in the first half of the year were down against the comparable period in the prior year, continuing
the trend that developed in the second half of 2012/13. During the first half, the rapid transition from
multi-man stores to one-man stores and the reduction of trading hours across the Group caused
disruption in our retail chain. We also experienced some decline in sales through independent
stockists.

We view these as short-term issues and expect to see growth return in both channels. We continue
with our store opening programme (27 stores opened, 20 closed in the period) secure in the
knowledge that our one man model allows us to ensure new openings are profitable. In the future we
expect to benefit from the more focussed selling operation across all channels against the background
of a materially lower cost base.

Changes to operating structure
We have just announced a major re-organisation of our sales businesses to allow management by
channel: retail, trade and direct. Our retail businesses will be consolidated under a single Retail Sales
Manager for each of our key geographic areas – UK, Europe and North America. Trade sales will be
consolidated into a global business, operating from Lenton, Nottingham.

Prospects
Our costs are well under control and margins remain strong. Cash management is good and our
capital expenditure continues as planned. The principal risks and uncertainties for the rest of the
financial year relate to sales and the implementation of the structural changes we have just
announced. Whilst profit will remain under pressure during the implementation of the structural
changes mentioned above, the board remains confident in the future growth and profitability of the
Group.

Going concern
After making appropriate enquiries, the directors have a reasonable expectation that the Group has
adequate resources to continue in operational existence for the foreseeable future. For this reason
they have adopted the going concern basis in preparing this condensed consolidated interim financial
information.

67566757

blueshift
01-16-2014, 11:50 AM
i wonder if GW going out of business would finally stop people from the constant complaining...

Billy_Mx
01-16-2014, 11:56 AM
i wonder if GW going out of business would finally stop people from the constant complaining...


Or, here is a crazier idea: Maybe if GW starts to do what is right for its customers, the constant complaining will stop. Crazy I know

Panther Berg
01-16-2014, 11:57 AM
Bite your tongue, friend.

Resinpants
01-16-2014, 11:59 AM
i wonder if GW going out of business would finally stop people from the constant complaining...

Lol! It would herald a new era of complaints about not being able to get models/rules etc!

DrBored
01-16-2014, 12:05 PM
Lol! It would herald a new era of complaints about not being able to get models/rules etc!

This. While playing X-Wing or Warmachine, they'll lament about that game that they hated on for years and years.

Erik Setzer
01-16-2014, 12:12 PM
For all the people who told me I was insane or cynical to suggest it, I hold this as evidence of the reason Escalation, Stronghold Assault, and the "Advent Calendar" exist. GW needed to move a lot of stock that it had, and fast, and the best way to do that was to introduce rules letting people use overpowered models in games. Put out rules for the special boxed sets they were coming out with, or using your super-heavies in 40K. It was easy with the two books to copy-paste and add or change a little bit, and then kick them off to the printers. With the digital stuff, they just needed to pull up some old fluff, toss together some rules, put them online and charge for them. Little cost for what they hoped would be maximum reward. That's also the reason Warhammer World in England is moving to "use any models you have!" because it encourages buying more models, especially expensive stuff from Forge World.

I admit, it wasn't a bad plan when you needed a desperation plan to move a lot of product fast. But that's what it was. It wasn't "adding new stuff to the game because it'd be cool and balanced." It was just trying to get product off the shelves and out the door to regain lost profits.

Benjamin Blanchard
01-16-2014, 12:22 PM
Or, here is a crazier idea: Maybe if GW starts to do what is right for its customers, the constant complaining will stop. Crazy I know

Maybe they would realize it at last. I know that people are often complaining for almost nothing, but in the case of GW, many complains are fully justified : prices that always goes up many times for exactly same product/less quantity in the box (even a company like Apple, often criticized for the prices on the high-tech market, doesn't do that, the prices are the same but you get the latest stuff), fluff completely stopped since 10 years, White Dwarf ridiculously empty of any part truly about gaming, making customers pay for their failures (yeah, because strangely there has been a general increase of the prices a few months after everyone realized how the whole Finecast affair was messed up)... Not to mention a little thing that can have importance for regular buyers : complete disapearance of any fidelity program since many years. I know that made some other retailers complain, at least in France it did, but at least from the buyer point of view, there was something.

Anyway, I really don't think that's the beginning of the end for GW, but I really hope they'll react in an intelligent way, not like a bunch of crappy money-obsessed people.

Zaphod Beeblebrox
01-16-2014, 12:30 PM
It isn't that bad when you look at it, the drop in Profit is about £4m, which is identical to the drop in royalties, in fact discounting royalties from 2012 to 2013 figures they are actually up £.6m on the previous year.
Actually, if you read the half-year report, you will see that that is not entirely correct.

Royalties are up 0.6 million compared to 2012 and operating profit is even down a little more than what the consolidated numbers show.
Please remember, that the reported numbers are compared to the half-year report until December 2012 and the whole Royalty issue with DOW and the likes was already done by then. But I agree, royalties are insignificant at the current level regardless.

The real bad numbers are these:
Sales are down by 12% - inspite of some really 'busy' sales campaigns, new White Dwarf and the like.
What's even worse is that Profits are down 30%! And Tom Kirby can claim that he is in control of his costs all day long - once sales are going down, he's in for a bad time.

This weekend I'll summarize some of the rumors I heard in advance of the big 'black-shirt' meeting in Nottingham which will take place in February. You will likely see more hectic sales initiatives, a lot of major changes - the one thing you won't find will be a long term strategy.

I got a whole series up on our blog about "The future of Games Days and Games Workshop" (8 1/2 parts by now, most of them terribly, terribly long, epic walls of text) which tries to apply a Chuck Norris roundhouse-kick to everything I personally and subjectively think GW is doing wrong. I have been a nerd about as long as I have been part of top international management (before I turned a full-time nerd for good!) so I think I am not entirely wrong about what I write ;)

Part 1 of this epic series starts here. (http://masterminis.blogspot.de/2013/08/the-future-of-games-days-games-workshop.html) There is a link to the respective next part at the end of each of these posts. I'd be interested to hear what you think. But beware: Reading all of the posts will probably take you a few hours. Perfect for a busy office day :D

You might also want to follow us on Facebook for similar news about GW.
Sometimes even GW management hears about official GW stuff on our blog first ;)

SHARE & ENJOY

tcraigen
01-16-2014, 01:23 PM
This is a scary thing to see. I have loved the game going on 2 decades now, I found my self really picking and choosing what I bought from gw this year though. The new marine releases were a rather Hefty weight on the wallet, I know if they were resin or still metal it would be pretty comparable but when 2 boxes blows through a hundred bucks like nothing and a wealth of great books, and piles of codexes and gaming books they seem to be releasing I find my self rethinking purchase, where as I was probably spending more when it felt like less just because it was a collection of smaller expensive purchases... It just "feels" like it all costs more so Ive spent less. I never want to see them go out of business. Maybe we'll get a sale or something sales incentives are never a bad move...

Deadlift
01-16-2014, 01:35 PM
Personally I think "money off" vouchers would be a good start in the new visions magazine. That may improve sales but I doubt very much GW have considered this an option.

Lukas The Trickster
01-16-2014, 01:59 PM
I don't think it will come as a huge surprise to many who follow GW's financial reports; their sales growth had been slowing for the past couple of years and increases in profit were thought to be mainly attributable to continued annual increases in prices and some increased revenue through royalties. This year prices for existing products weren't increased as per the year before, plus many of the stores have reduced their opening hours as they have become staffed by only one person - my local one has nearly halved its opening hours, even over the Christmas period. Did anyone else notice that the Interim Management Report states that 'We also inexperienced some decline in sales through independent stockists', I would venture that this is very possibly a result of a reduced willingness on behalf of FLGS, model stores and toy shops to stock as much of GW products as they used to or even at all due to the increasingly restrictive conditions GW imposes on them, particularly with regards to online sales. That being said, for those of you that care to look at the figures, GW still made a fairly respectable profit at £7.8 million.

We have all noticed that over the past year GW has embarked on what is, for them, a fairly radical programme of restructuring their retail chain - there has been a trend in closing larger, more expensive stores whilst turning the remaining ones into single staffed operations, and according to the report they are embarking on further reorganisation of their supply and sales chain, aimed at further cost cutting we assume. Plus towards the end of last year they appointed Elaine O'Donnell to their board of directors, a former mergers and acquisitions partner with accountants and corporate advisory firm Ernst & Young. I am no business expert, but to me it really seems that GW's board are setting the company up for something...

Lukas The Trickster
01-16-2014, 02:10 PM
Whilst I was looking through GW's Investor Relations pages, I came across this, which is definitely new

http://investor.games-workshop.com/bribery-policy-statement/

In their own words - 'Woe betide anyone who lets GW or themselves down!'

6758

Defenestratus
01-16-2014, 02:18 PM
Whilst I was looking through GW's Investor Relations pages, I came across this, which is definitely new

http://investor.games-workshop.com/bribery-policy-statement/

In their own words - 'Woe betide anyone who lets GW or themselves down!'

6758


While it may be a bit dramatic, those bribery statements are rather common.

Flame of Udun
01-16-2014, 02:57 PM
The ultimate solution that would benefit the hobbyists would be for GW to go private, cut out the shareholders and refocus on their customers and producing more content rather than the factory line style production we have seen over the last year-ish. Sadly I cannot see that happening though.

Nathan Flentjar
01-16-2014, 02:59 PM
This. While playing X-Wing or Warmachine, they'll lament about that game that they hated on for years and years.

Funny you should say that. I've started playing X-Wing along with a bunch of my friends. While we still technically have 40k armies and everything, large portions of my army remain unpainted, unassembled and unloved due to the ease, fast pace and excellent minis of X-Wing. I for one kinda want GW to flop. Maybe the 40k franchise will be bought out by someone with at least an iota of concern for their customers.

Denzark
01-16-2014, 04:05 PM
I've said it in the other thread and I'll say it here. Luxury item in a time of dire financial constraint? of course they will bring in less. They are still profitable and have never been in receivership like several big UK highstreet names. This does not appear to be loss, just less.

It is not the tipping point, I would suggest buying the shares now.

deinol
01-16-2014, 06:44 PM
Profit is down does not mean they aren't making a profit. I wouldn't say the sky is falling yet. It's just the ups and downs of regular business.

Lexington
01-16-2014, 09:31 PM
I've said it in the other thread and I'll say it here. Luxury item in a time of dire financial constraint? of course they will bring in less.
The common wisdom on luxury items (quoted pretty often when it comes to GeeDub financials, actually) is that they sell just fine in a recession. More, this particular recession has been going on for, what, six or seven years now? GW's lot during this time has gone up and down in a way that suggests they're not particularly affected. Also, wargaming as a whole? Doing just fine. Privateer Press has exploded in the last three or so years, and games like Infinity, X-Wing and Dystopian Wars have all gained the sort of player base that hasn't been seen since Warzone and VOR took a shot at it fifteen or so years ago.

I couldn't tell you the actual causes of GW's current financial woes, but the signs point to self-infliction. They'll recover, but what they do to right the ship is going to be "interesting."

daboarder
01-16-2014, 09:34 PM
I'd like to throw in some other things you need to note.

Yes GW is still making profit, but who cares, you can make the same profit year in year out as a business and your still considered a failure. Its about growth, it you don't show growth then your in big trouble.

As to GW stock? I wouldn't touch it with a ten foot poll, its long been considered vastly over priced due to its limited numbers and tight controls on who owns it.

Psyfer
01-16-2014, 10:14 PM
Eh, I've pretty much given up on GW. The only thing Warhammer and 40k have going for them these days is the setting. The minis are hideously overpriced and the rules are antiquated.

I'd hope GW see the writing on the wall and at the very least drop their prices to a competitive level, but if the last 10 years are anything to go by, I doubt it.

eldargal
01-17-2014, 02:41 AM
Meh, one half yearly result means nothing significant. Two would be a problem. GW have no debt and plenty of room to maneuver if you think this is the beginning of the end you're a hyperbolic twit.

Wolfshade
01-17-2014, 03:03 AM
I'd like to throw in some other things you need to note.

Yes GW is still making profit, but who cares, you can make the same profit year in year out as a business and your still considered a failure. Its about growth, it you don't show growth then your in big trouble.

As to GW stock? I wouldn't touch it with a ten foot poll, its long been considered vastly over priced due to its limited numbers and tight controls on who owns it.

PWC did a market analysis and gave them 96% of the market share, there is very little room for growth in that, they are at near saturation point.

As for it being over priced, well, the market up until yesterday afternoon disagreed with you.
Yes PP has "exploded" however, a small company growing rapidly can still be smaller than a large company growing slowly.

I am slightly concerned that GW have reached the point where prices are becoming an issue.

They opened higher than they closed today, but still way down on the 15th.

Wolfshade
01-17-2014, 03:07 AM
Eh, I've pretty much given up on GW. The only thing Warhammer and 40k have going for them these days is the setting. The minis are hideously overpriced and the rules are antiquated.

I'd hope GW see the writing on the wall and at the very least drop their prices to a competitive level, but if the last 10 years are anything to go by, I doubt it.

You mean the same last 10 years, where they paid off historic debt, heavily invested in new plastic technology to produce the best miniatures in the market?

I am unsure how you can say the rules are "antiquated" in any meanignful way. The two systems 40k and WFB rules are fairly modern, but the whole system of stats and random numbers is mirrored thorughout the sector and in others, consider fallout's special system for instance.

leighjt
01-17-2014, 04:01 AM
I used to defend GW... they make fantastic miniatures and books. But the recent prices have been hard to understand and stomach. 3 plastic miniatures (centurions/hive guard) for about £45 is just obscene... it's attempted daylight robbery. I'm not short of a bob-or-two ($$ for the non brits) but even i suck my teeth when i see the prices of the new stuff.
How can they justify the Wraithknight at £70 - the same price as a stompa but a LOT less kit
How can they justify the Exocrine which is a smaller model than the Tyranofex and £9 more expensive

My local games club hardly has any 40k/WFB going on now... we play massive Apocalypse games once or twice a year but that's really it...
We all hoped that the move to plastic would see prices stabilize but (to me) it seems like the board at GW are now only interested in fleecing their customer base. Most of their model kits are not remotely in the price range of Kids, really even in the price range of a Birthday Present. Being honest, i don't think that i could bring myself to introduce any of my friends children into a GW based game system now... simply because they could not afford what they really wanted.

Unless GW find a way to keep their profit margin, but reduce the price point (hint: move the manufacturing out of the UK!!) i see this as a current trend...

daboarder
01-17-2014, 04:09 AM
PWC did a market analysis and gave them 96% of the market share, there is very little room for growth in that, they are at near saturation point.

As for it being over priced, well, the market up until yesterday afternoon disagreed with you.
Yes PP has "exploded" however, a small company growing rapidly can still be smaller than a large company growing slowly.

I am slightly concerned that GW have reached the point where prices are becoming an issue.

They opened higher than they closed today, but still way down on the 15th.

then you diversify your investments or you increase the volume of the market.

anyone know how quickly or when exactly the price dropped? any chance they we're issued a warning or a speeding ticket?

eldargal
01-17-2014, 04:13 AM
then you diversify your investments or you increase the volume of the market.

anyone know how quickly or when exactly the price dropped? any chance they we're issued a warning or a speeding ticket?
Which is probably why they have been licensing like crazy recently. There will probably be a Warhammer Total War game announced sometime this year too, that will boost royalties when it comes out.

Wolfshade
01-17-2014, 04:17 AM
It all seemed to happen yesterday afternoon.
With modern automatic trading you can see very rapid devaluations of share price as one automatic system triggers another and so on. I don't know if that is what happened here though.
I think GW are trying to increase the volume of their market. They are the only table top wargame manufacture that I know of that actually have stores and train their staff to teach people how to play. That might not be the same in other regions.
Diversify is a plan though to where is the question. Looking at how FF took old GW licences and re-vamped them, that would be good, but I wonder how much of that is the same market.
There are a couple of 40k games coming out this year which would be useful.

Psychosplodge
01-17-2014, 04:41 AM
Which is probably why they have been licensing like crazy recently. There will probably be a Warhammer Total War game announced sometime this year too, that will boost royalties when it comes out.

Yeah but after the broken mess that was Rome2 at release, well unless the tf2 hats are spectacular it'll be a steam sale purchase for me...

eldargal
01-17-2014, 04:43 AM
Hopefully CA will learn from it, I'll still be pre-ordering. I do that with TW games.:rolleyes: Actually really hoping they do a Collectors Edition with some miniatures in it, that would be fantastic.

Psychosplodge
01-17-2014, 04:49 AM
That would be potentially awesome, but I bet you don't get the hats if you buy a hardcopy...

Wolfshade
01-17-2014, 04:55 AM
WHo cares of hats, we want WFB:TW.

daboarder
01-17-2014, 04:58 AM
It all seemed to happen yesterday afternoon.
With modern automatic trading you can see very rapid devaluations of share price as one automatic system triggers another and so on.

yes and if it happens too fast without announcements or before announcements from the company you get a warning from the stock exchange (a speeding ticket) if the situation is steep enough or occurs often enough the stock exchange can halt trading on your stock temporarily and recommend investigation.

Psychosplodge
01-17-2014, 05:05 AM
WHo cares of hats, we want WFB:TW.

Because the previous two Total war games came with DLC for Hat Fortress two!

Wolfshade
01-17-2014, 05:13 AM
Ah I see what you mean about the speeding ticket. I am not familiar with the mechanics of actual trading.
It seems fairly stable at the 540/530 level so I don't know. Certainlyl it doesn't see a sustained slump.

BrotherAlpharius
01-17-2014, 05:26 AM
The ultimate solution that would benefit the hobbyists would be for GW to go private, cut out the shareholders and refocus on their customers and producing more content rather than the factory line style production we have seen over the last year-ish. Sadly I cannot see that happening though.

I have to disagree with you there. Unless you know a billionaire wargaming philanthropist willing to run the company for the benefit of gamers regardless of the personal cost a shift from Public to Private is not the answer. "Going private" doesn't eliminate shareholders, it just makes things less transparent. The company was originally floated on a public exchange to generate capital for growth. That's not free. Shareholders have invested their money in the shares, that carries an opportunity cost, they have every right to expect a return on their investment. In order to "go private" the new private shareholders would have buy out all of the current shareholders which would require massive expenditure, an investment on which the private owner would expect a return. Private companies still have shares and shareholders and dividends. Being a public company simply means that they are subject to more transparent regulatory and reporting requirements.

Don't hate shareholders. Their investment is an important factor in successful growth and as investors they have every right to expect a return on their investment. Similarly, don't hate Directors for putting shareholders' interests first, they have a legal and moral duty to look after the investments of the shareholders.

Having cleared up those points of principle, I say, feel free to let rip at the way the Board is going about those responsibilities. I'm not saying that they're doing a good job, just criticise them for the correct things!

I don't think shareholder interests and customer interests should be at odds. I work for a company where we aim to build long-term relationships with clients where they feel that our services offer value for money (not the same thing as being 'cheap') and we make decent profits that please our shareholders. It's not as simple as that, there are challenges, but generally there is respect between customer and supplier. The problem with GW in my opinion is that the Board doesn't seem to respect or wish to retain its customer base. It seems to answer everything with the so-called "price gouging" on the assumption that turnover will increase accordingly, or at worst the customer base will spend the same amount of money but the company will not need to deliver as much product for that money so profits will still increase. If all else fails there will be more schmucks along soon.

In fact, my own experience at least is that instead of spending more money, or spending the same money for less product I've not even started some armies or projects with GW and have switched to other companies altogether. In my case over the last couple of years 95% of the money I would have spent on GW has gone to Spartan Games instead because moves like making their fleet books available as free pdfs downloadable from their website and updated from time to time to fix rules problems show that they are interested in making a good, balanced game rather than producing a £20 book that is unbalanced, justifying flogging you £25 book four years later and so on.

The rich background of 40k/Horus Heresy is for me the only thing that keeps me giving a damn about GW.

Mr Mystery
01-17-2014, 07:41 AM
TL:DR.

Have they tried kicking it?

Has anyone accused them of cooking the books yet?

Have they tried kicking it?

Has anyone claimed they're selling themselves to someone yet?

Have they tried kicking it?

Wolfshade
01-17-2014, 08:08 AM
Has anyone accused them of cooking the books yet?
Has anyone claimed they're selling themselves to someone yet?


No - surprisingly
No - surprisingly

Psychosplodge
01-17-2014, 08:12 AM
Are you sure? I thought I'd seen the second one, but maybe that was in the now locked thread?

CG13
01-17-2014, 09:01 AM
I am unsure how you can say the rules are "antiquated" in any meanignful way. The two systems 40k and WFB rules are fairly modern, but the whole system of stats and random numbers is mirrored thorughout the sector and in others, consider fallout's special system for instance.
The rules are current in that they were published recently, but the IGo-UGo whole army turns is fairly antiquated in light of more modern wargaming systems.

Modern wargames have aspects where both players are more active during both turns. Examples include ARO's in Infinity, Firestorm Armada's alternating activations and Star Wars' initiative based order of activation.

40K has added Overwatch back in and Fantasy always(?) had Stand And Shoot, but those don't tend to have a major effect on gameplay (IMO, YMMV). Generally, you still beat on the other guy's army with yours while he stands there and hopes to survive until he gets to do it back. That paradigm has been around for decades.

Wolfshade
01-17-2014, 09:27 AM
So do we ignore LoTR?

But rather than saying antiquated it is different.

Consider PC strategy games, initially they were turn based because there was insufficient processing power to do real time. We now have real time games, but no one would say Rome II is antiquated, whereas Masters of Orion is modern. They are just a different way of doing things.

I also wonder what the difference is in the scale of these games? I've heard of Infinity but not Armada so I don't know. My gut feeling is that alternating activations would work well in the smaller scale.

CG13
01-17-2014, 09:53 AM
So do we ignore LoTR?

But rather than saying antiquated it is different.

Consider PC strategy games, initially they were turn based because there was insufficient processing power to do real time. We now have real time games, but no one would say Rome II is antiquated, whereas Masters of Orion is modern. They are just a different way of doing things.

I also wonder what the difference is in the scale of these games? I've heard of Infinity but not Armada so I don't know. My gut feeling is that alternating activations would work well in the smaller scale.

You mentioned WFB and 40K, so I addressed those. I don't know anything about LoTR, so I can't comment on it.

I'm not saying that GW isn't capable of making a "modern" style wargame, just that 40K and WFB aren't what I would consider modern. Just because something is antiquated doesn't mean that it can't be fun. People do antiquated things all the time, but newer developments often make the older methods less appealing in comparison. You can build a house with a saw and a hammer, but most people use poured concrete and power tools.

Lukas The Trickster
01-17-2014, 09:55 AM
Has anyone claimed they're selling themselves to someone yet?

Well actually I did, well sort of, there was a bit of eyebrow raising on my behalf anyhow when out of the blue last November they appointed a non executive Director to their board with no experience in the industry, but instead ample experience as a corporate finance director advising on mergers and acquisitions. There have been rumours about GW being put up for sale for over six months, BoW were talking about it last June........ who knows, its probably b*llocks, but these things come from somewhere, and more and more within the past year we have been getting increasingly reliable and accurate rumours about GW's products and activities well before stuff actually sees the light of day.

BrotherAlpharius
01-17-2014, 09:55 AM
yes and if it happens too fast without announcements or before announcements from the company you get a warning from the stock exchange (a speeding ticket) if the situation is steep enough or occurs often enough the stock exchange can halt trading on your stock temporarily and recommend investigation.

I'm not clear what you're referring to here. Yes a company can get in trouble for failure to make announcements to the stock exchange in accordance with the UK Listing Authority rules but they don't actually control the share price, that's just driven by market forces. In this case GW announced their results. If analysts concluded that the company was a sinking ship and the major investors dumped all of their stock en masse then the share price could drop by 99% and the company wouldn't have done anything wrong in relation to the market rules (they'd obviously have done something very wrong in terms of being competent business people!).

Defenestratus
01-17-2014, 10:19 AM
No - surprisingly
No - surprisingly

I don't think anyone has really accused GW of legal or regulatory malfeasance, just perhaps a bit of management bubble blindness as it relates to the market they exist in.

In other words, hobbyist/gamer critics of GW think they've made bad decisions. This report and stock value drop vindicates their (our) opinions.

Mr Mystery
01-17-2014, 10:27 AM
It was mostly a tongue in cheek one :p

You see, over on Dakka, every time GW post up positive figures (so not really applicable on this occasion, though things aren't as bad as some might claim), the usual neckbeards waddle up from Mother's basement, pausing only to pull up their stretch pants and start hooting and honking about how they've clearly cooked the books, because all the neckbeards agree they should be making a massive loss.

Denzark
01-17-2014, 11:19 AM
Meh, one half yearly result means nothing significant. Two would be a problem. GW have no debt and plenty of room to maneuver if you think this is the beginning of the end you're a hyperbolic twit.

Succinctly put Ma'am!

Bigred
01-17-2014, 11:25 AM
Well if anyone was in the market seriously considering an acquisition of GW, they just got 25% cheaper yesterday. If you are that new director at GW with all the expertise in M&A, its not exactly the kind of thing you would want to put forward to maximize your sell price.

That said, GW is still making tons of money in this industry and let's be honest, they aren't going anywhere.

But the trend continues year per year of the industry moving from a uni-polar world completely in the sway of GW to a multi-polar world of 3-4 big movers and shakers with many medium players constantly in flux.

Five years ago if I said that GW, FFG, Privateer, and Battlefront would all be key players in wargaming with about a half dozen more medium players like Spartan, Mantic, Wyrd and such growing like weeds - you would have thought I was daft.

Now it doesn't seem so far fetched today.

GW is mighty and still the #1 player in the industry - but she isn't the superpower she once was. Oddly it's also seems a case of most of these wounds being self-inflicted. It's difficult to point a finger at any single competitor and say "they did it to GW".

In the end, I think the industry to quite healthy, and the current state of affairs is only a good thing for consumers and consumer choice.

Lukas The Trickster
01-17-2014, 11:44 AM
Well if anyone was in the market seriously considering an acquisition of GW, they just got 25% cheaper yesterday. If you are that new director at GW with all the expertise in M&A, its not exactly the kind of thing you would want to put forward to maximize your sell price.

Good point, although details on her professional background in corporate finance comes from an article in the Manchester Evening News when she stepped down from Ernst & Young in October, shortly before taking up the job at GW in November.

http://www.manchestereveningnews.co.uk/business/professionals/elaine-odonnell-steps-down-from-ernst-800136

Wolfshade
01-17-2014, 03:09 PM
Well it finished 2p down on open, which is hardly a free fall movement.

In terms of who is playing what, it seems to me that the new players to mantic et al. are from GW rather than being new gamers in their own right.

Mr Mystery
01-17-2014, 03:34 PM
Plus, with GW being the only element of the market publicly listed, it's really hard to say how the rest of the market is doing. All we have is anecdotal information.

Bigred
01-17-2014, 03:54 PM
Plus, with GW being the only element of the market publicly listed, it's really hard to say how the rest of the market is doing. All we have is anecdotal information.

FFG and PP aren't hurting...

Mr Mystery
01-17-2014, 04:12 PM
Based on what info?

I'm not saying they aren't, but without their balance sheets being public record, who can say for sure?

daboarder
01-17-2014, 04:35 PM
I wouldn't invest in GW stock, its still far too overpriced due to the controls on the number of shares issued to the public.

And loosing 24% of you value....is insane. Thats the kind of thing that gets board members removed.

Bigred
01-18-2014, 12:00 AM
... loosing 24% of you value....is insane. Thats the kind of thing that gets board members removed.

Indeed.

I want to give you a little thought experiment and you tell us what you think would happen...

a) Imagine if a large publicly traded industry leader in its niche company (Coke, Nike, McDonalds, Ford, etc...) had a CEO with a proven record for increasing the stock price under his term of office - leave the company after many years.

b) The individual stockholder with the most personal shares steps in and tells the board he will act as "acting CEO" in the meantime and run the company while he leads the search for a replacement CEO.

c) A FULL YEAR passes and no CEO has been announced and the individual stockholder is still working as "acting CEO".

d) The financials are released and expectations are not met, resulting in a decline in stock value for the company of 25% in a 24-hour period.

e) The individual stockholder tells the board everything is under control and not to worry.

What do you think the board would do?

What would YOU do if you were sitting on that board (at Coke, Nike, McDonalds, Ford, etc...) and responsible for millions of hard earned cash invested in that company?

Now ask yourself - what will Games Workshop's board do?

Mr Mystery
01-18-2014, 04:55 AM
Depends if they can do anything.

The chap in questions own a lot of shares. Majority share? I dunno.

But if he does, surely the other shareholders don't have enough clout to get shot?

daboarder
01-18-2014, 05:33 AM
depends on the constitution of the company.


Actually It might explain the situation if one of hte major investors (who usually get a spot on the board for their investment) demanded that the acting ceo/chairman step down, if the board voted against them I could see them pulling their investment from the company in the wake of this report. Which would explain the shareprice plummet.

Cap'nSmurfs
01-18-2014, 06:14 AM
You don't need a hypothetical, though. Y'all might want to look at what's going on with Nintendo at the moment. Now that's a crisis. Gee Dubs are still in profit, as they said they would be. They didn't make any crazy forecasts. Nintendo, on the other hand, wildly overestimated the success of the WiiU, wildly overestimated their 2014 profits as a result, and are now hastily climbing down. They stand to lose about £336 million this year. There are calls for the CEO to resign; Iwata, meanwhile, is talking seriously about overhauling Nintendo's entire business model as a result of this ****-up.

Now THAT is a crisis.

The stock analysis still relies too much on an assumption that it's individuals making a decision to sell in such a short timeframe, rather than robots. But it's robots. It's robots, guys. Robots. The stock market is horse****. Robotic trading turns any blip or disappointment into a meltdown overnight.

Mr Mystery
01-18-2014, 06:41 AM
And having given up on Terminators, Skynet turned its attention to the stockmarket and sat nav, in a two pronged approach to bankrupt man and watch him starve, or failing that, get us to drive down roads that aren't roads..

:p

Deadlift
01-18-2014, 06:48 AM
Which ever spin we put on this it's not great news for GW. However if the company sees this as an opportunity to improve the way it does business this could be a positive for us the consumer.

Cap'nSmurfs
01-18-2014, 07:31 AM
It's not great, no, but it's also not that bad. My only beef is with the "sky is falling" crowd. Their plan is to be sustainable; they're still in profit. This year is going to be a big one, as they roll out the new website and online store.

eldargal
01-18-2014, 07:45 AM
It's not great, no, but it's also not that bad. My only beef is with the "sky is falling" crowd. Their plan is to be sustainable; they're still in profit. This year is going to be a big one, as they roll out the new website and online store.

^This. It's not good, growing profits is good. But unless it starts trending down over the next year or so it isn't particularly bad either. Even if it does start to trend down GW have next to no debt and plenty of time to restructure and sort things out.

Mr Mystery
01-18-2014, 07:57 AM
It's also worth considering the wider economic state.

The UK is finally picking up speed. Nerves are settling. Whereas hobbies tend to be recession proof (low cost, high enjoyment), other things aren't. Like nice holidays, or moving to a bigger house.

As the economy strengthens, people become more confident that their jobs are safe, which means they tend to go for larger purchases/investment that they'd been putting off.

So where someone might have spent £XX a month on plastic crack, they may now spend the same annual cost on a nice holiday they've been in need of for a while.

But I'm not economist, so if anyone better versed would care to weigh in :)

Lexington
01-18-2014, 08:47 AM
Yikes. From the Faeitsvilles (http://http://natfka.blogspot.com/2014/01/gw-changes-stores-closing-and-armies-no.html)...


A lot of things will change at Games Workshop 2014:

*LotR and the Hobbit francise will be handed over to Forge World
* Forge World products will be available over the redesigned Games Workshop
webpage
* no more Fincecast products
* Wood Elves, Bretonnia, Beastmen and Khemri products will no longer be produced, updated or supported
* roughly 30% of the sortiment will be come webshop exclusives
* all Games Workshop stores in Germany will be closed

Not all bad moves (bye bye, Finecast), but a lot of ugly news for a variety of player groups. Bretonnians were the first army I ever played in a GW game, way back at the start of 5th Edition WHFB. Sad to see them go.

Mr Mystery
01-18-2014, 08:54 AM
Utter bollocks I'm afraid.

eldargal
01-18-2014, 09:01 AM
Believe it when I see it.

-Why would FW get ranges that are mostly plastic? Do not buy it
-That makes sense but then it's been wishlisted for ages so who knows/
-Believable, also speculated about for ages though.
-Cannot believe this. We are expected to believe GW are going to drop 25% of the WFB army range for Reasons? Utterly unprecedented and in direct contradiction to what Jervis Johnson has been saying over the past year that no existing armies would be dropped.
-Maybe? not a big deal really
-Contradicted by the other rumour which says leadership of the stores is being folded into GW Nottingham, not all stores actually closing. This rumour also being corroborated by other sources.

such salt. wow. very disbelief.

Psychosplodge
01-18-2014, 11:38 AM
You don't need a hypothetical, though. Y'all might want to look at what's going on with Nintendo at the moment. Now that's a crisis. Gee Dubs are still in profit, as they said they would be. They didn't make any crazy forecasts. Nintendo, on the other hand, wildly overestimated the success of the WiiU, wildly overestimated their 2014 profits as a result, and are now hastily climbing down. They stand to lose about £336 million this year. There are calls for the CEO to resign; Iwata, meanwhile, is talking seriously about overhauling Nintendo's entire business model as a result of this ****-up.

Now THAT is a crisis.
.

Not really that's a **** up.
The big N apparently have huge cash reserves running into the billions...

BrotherAlpharius
01-18-2014, 05:50 PM
...
d) The financials are released and expectations are not met, resulting in a decline in stock value for the company of 25% in a 24-hour period.
...

What would YOU do if you were sitting on that board (at Coke, Nike, McDonalds, Ford, etc...) and responsible for millions of hard earned cash invested in that company?


Well firstly it's the shareholders not the Board who decide to vote on the appointment of the Board members but assuming that I was a major shareholder or their representative or advisor. I would...

Recognise that share prices can and often do fluctuate quite substantially in the immediate aftermath of publication of results.

Review the report in detail.

Consider the dividend and share price performance over the last three years.

Weigh the above against data the equivalent performance measures for an appropriate comparator group of companies - "a rising tide floats all boats".

Make an informed decision.

Really I think that despite the headline of "Bombshell" this news was more the pop of a gretchin blunderbuss.

Mr Mystery
01-18-2014, 07:19 PM
In addition, I'm not aware of any profit warning going out this time?

DarkenAvatar
01-19-2014, 01:15 AM
I'm going to weigh in even though I'm not much of an internet commentator. We all know basic economics, you look for the highest price that will get you as much money to pay for the sales you would have had at a lower point. its the sweet spot on pricing. The problem with that as I see it in games workshops case is that while they may have reached that point for their current fans, they are light years beyond it with any new ones they would be trying to attract.

Our hobby is too expensive to start. and you need a certain healthy number of players in your pool in order to attract new players. No one starts a game that is as big of a commitment as this without a certain guarantee that they will be able to play with the models that they buy and spend so much time on.

Cap'nSmurfs
01-19-2014, 06:01 AM
"Really I think that despite the headline of "Bombshell" this news was more the pop of a gretchin blunderbuss."

Quite, there's been a lot of terms like "crisis" and "spectacularly bad", but it really isn't justified. Unless, of course, one is constantly hunting for clicks. Click click!

"Not really that's a **** up."

But either way, it's the sort of scenario that might actually see the CEO of a major company lose his job, and is genuinely prompting consideration of a company restructuring its business.

Wolfshade
01-19-2014, 05:04 PM
Well the stocks news I've heard is that it has moved from Buy to Hold, so not quite rats leaving the sinking ship.

Deadlift
01-19-2014, 05:18 PM
Usually hold on shares are given by market analysts for companies that may be going through a bad period, but the share value is expected to bounce back. It stops investors from panic selling.

I suspected it may have been to prevent another company from jumping in and getting majority shares while the price is low.

That's what I've just found out anyway ;)

weeble1000
01-29-2014, 11:43 AM
GW closed up 0.1% today (http://uk.finance.yahoo.com/echarts?s=GAW.L#symbol=gaw.l;range=1d;compare=;ind icator=volume;charttype=area;crosshair=on;ohlcvalu es=0;logscale=off;source=undefined;), but there was unusually high volume. About 500,000 shares were sold at 4 p.m. today and at 4:20 someone purchased 1.2 million shares, or roughly 3% of GW's total shares.

weeble1000
02-14-2014, 10:38 AM
This is interesting in this particular context. Jonathan E. Moskin is lead counsel representing Games Workshop in the Chapterhouse Studios lawsuit.

He was quoted in an article about the Dumb Starbucks (http://www.corpcounsel.com/id=1202642562939/Starbucks+Plays+It+Smart+With+Dumb+Starbucks+TM%3F mcode=1202615518654&curindex=2&curpage=ALL). I think you'll find his views quite...interesting.


Jonathan Moskin, a partner who specializes in intellectual property at Foley & Lardner, said big companies are often better off letting the infringement slide—especially if action is likely to bring negative attention. “These are usually lose-lose propositions for brand owners,” he said. “If they win, they’re seen as beating up on an artist, and if they lose, then they come away with a black eye.”

Psychosplodge
02-17-2014, 02:39 AM
And what's it say behind the registration pop up?

SquigBrain
04-02-2014, 07:30 PM
Our hobby is too expensive to start. and you need a certain healthy number of players in your pool in order to attract new players. No one starts a game that is as big of a commitment as this without a certain guarantee that they will be able to play with the models that they buy and spend so much time on.

This is what you call hitting the nail on the head right here. GW needs to have something along the lines of Kill Team as an honest-to-god product.

Wolfshade
05-22-2014, 05:00 AM
So here we are 5 months (and several days) after GW lost 24% of it's stock value.

The thread title: Games Workshop's stock loses 24% value today. It has begun.

But the question is what was "it". The perinnial doomsayers said iot was the end of GW, but we have 7th ed 40k being released at the weekend and 9th WFB just arround the corner so there is some life left in the old gal.

Quick look at the market and what do we see:

(Based on YTD correct at the time of posting)

15/1: 723
16/1: 547 (Down 24%)

Then GW shares continued to lose value to 4/3 hitting 476.25 (35% drop from pre-drop, 13% drop day). Then a curious thing occured/ is occuring, over the last 3 months there has been steady growth in the share value, so that as of today they are at 599, so still down 13% on the YTD high, but quite good.

Times are a changin'

So what has changed between those cold January months and now?

Well, we now have a weekly WD and Visions, which seem to have been recieved well, by and large. Certainly, there are still those who want more hobby content and tutorials, but it seems to be more of a magazine again and less of a GW monthly catalogue of stuff to buy (which it still is but that is the point isn't it...).

We also have a weekly release schedule, I was very skeptical of this to begin with, especially as the weekly releases just seemed to be dataslates, now there seems to be a re-balancing between digital stuff and actual plastics, so that is good.

We also have new editions right around the corner and usually, this prompts expediture across the whole community in the way that a release for an army/codex does not. Note, each edition shift is not a har impact, as there will be those who wait for it to be released in a different format, i.e. boxed set, small, digital etc. or wait to get it for their birthday/christmas/hannuka/saturnalia. There will also be those who are lost at the edition jump. With the release being only 2 years from the previous change it is unclear how many will not bother with this edition initially and how many will just not pick up the new codex.

We also have a new website that is a huge improvement on the previous one, though there are still issues with some of the coding, commonly amongst the issues are language preferences being lost.

We also have the problem that the FAQs were lost, well shifted to BL, and these remain tired and in need of updating. Though in the benefit of hindsight it can be seen why these weren't done, as the new edition was worked on. It is still frustrating that the FAQs were not updated and the various Warhammer FB/40k fora were/are filled with threads on rules questions that require a definitive answer for GW. This still points to issues with the rules.

So we have had change, some of it good, some of it not so good and we have had the same old issues. It will be interesting to see what happens in the comming months and the next 6 month accounts.

Bigred
05-22-2014, 01:02 PM
With a chart! Everyone loves charts?

8905

DrBored
05-22-2014, 01:15 PM
One of the things I learned about stocks is that they're very emotionally charged.

When that drop came, plenty of people were dead certain that this was it, GW was down and out, they'd be bought out by someone else and we'd have Hasbro Space Marines or something along those lines.

Yet, here we are. Those with level heads and a reasonable eye for growth and opportunity kept investing in GW, and hence we have our current upward trend.

Personally, glad to see it panning out.

confoo22
05-22-2014, 01:21 PM
When that drop came, plenty of people who don't understand how the stock market works and/or wanted to push a narrative were dead certain that this was it, GW was down and out, they'd be bought out by someone else and we'd have Hasbro Space Marines or something along those lines.

Fixed.

DrBored
05-22-2014, 01:25 PM
Fixed.

LoL thanks :D

The Imperial Fist
05-22-2014, 01:41 PM
As long as we continue to support them GW will never die, whether people see that as a good or bad thing. Maybe they'll shrink and some things will scale back if things get really bad, but as long as people like us need their doses of plastic and resin crack they know they can weather most storms.

Wolfshade
05-22-2014, 01:47 PM
Graphs make everything better. Looking at the wider trned, pre-January you see that the worm had already turned. It just took a massive nose dive on that day.

Denzark
05-22-2014, 02:55 PM
Fixed.

Good shout Confoo.

eldargal
05-23-2014, 01:26 AM
With a chart! Everyone loves charts?

8905

I'll be honest, I'm only here for the chart.

White Tiger88
05-23-2014, 01:28 AM
I'll be honest, I'm only here for the chart.

*sigh* You just love those charts eh?

Psychosplodge
05-23-2014, 02:38 AM
omg SELL! SELL! SELL!

http://i57.tinypic.com/208y8o1.jpg

Zaphod Beeblebrox
05-23-2014, 04:57 AM
So we have had change, some of it good, some of it not so good and we have had the same old issues. It will be interesting to see what happens in the comming months and the next 6 month accounts.

I think the upcoming end of the financial year will show us what's what.

GW has tried to create as much sales as they could before the end of the fiscal year - and that does not only include the 'quick and surprising' WH40K rules. After all, around 90% of sales are generated by 40K, 10% by Fantasy and <1% by LotR (GW source). So a quick cash-grab with new rules could push sales quite a bit. If there's one thing you need, it's rules ;)

But behind the scenes they also tried to cut costs (in short: firing all countries but US) and increase sales. In Germany stores got an extra 5% off from any orders before June. In redeemable coupons - that can be redeemed after June.... Guess when the financial year ends....

As far as I am concerned, the next yearly financial report is the most anticipated release from GW this year. ;)

Wolfshade
05-23-2014, 05:33 AM
But behind the scenes they also tried to cut costs (in short: firing all countries but US) and increase sales. In Germany stores got an extra 5% off from any orders before June. In redeemable coupons - that can be redeemed after June.... Guess when the financial year ends....

I am not sure what you are saying here.


After all, around 90% of sales are generated by 40K, 10% by Fantasy and <1% by LotR (GW source)
This is wrong.
The one and only time that GW sales by range were ever made public was part of the CHS case. (Here (http://www.archive.org/download/gov.uscourts.ilnd.250791/gov.uscourts.ilnd.250791.208.32.pdf))

Black Library Revenue (North America only):
2008: Warhammer 40,000 77% - Warhammer Fantasy 22%
2010: Warhammer 40,000 78% - Warhammer Fantasy 21%

GW Revenue (World Wide):
2008-2009 Fiscal: 40K - 50.6%

So your source is widely mistaken.

But yes their financial year is to end of this month so we should see a report what mid to end of July?

Charon
05-23-2014, 07:03 AM
We also should not forget that they closed stores, reduced their size significantly and reduced employees. Thats quite a bit of money from tax, rent, wage,... which push profit.

Mr Mystery
05-23-2014, 10:37 AM
Which they've been doing for yonks anyway.....

As for everything being rushed.....nah.

Weekly releases and 7th Ed 40k clearly in the pipeline long before things went a bit ploin shaped.

Wolfshade
05-23-2014, 02:31 PM
That wouldn't affect revenue per se, if anything it would decrease sales and thus revenue.

Lexington
05-24-2014, 02:01 PM
Well, we now have a weekly WD and Visions, which seem to have been recieved well, by and large.
I think the idea of Visions being "recieved well" is, at best, amazingly generous. ;)

When it was released and replaced the traditional WD, GW was overwhelmed by subscription cancellations - I've heard quite a few people say that Apple reps were telling them that it'd been something of a tsunami of irritation and refund demands, which were handed back to GW for processing. Can't imagine readership's been great, given that.

That said, this probably isn't a big deal for GW either way. Visions appears to exist primarily as a low-cost way to run out existing WD subscriptions while a separate, weekly sales channel was opened with WD Weekly. I fully expect Visions to exist for around as long as it takes to fulfill existing subscriptions, then be quietly retired.

As to GW's health overall, I think we'll just have to wait for the next financial statement before coming to any useful conclusions.

DarkLink
05-24-2014, 10:14 PM
We'll see the fallout of 7th, too. I'm amazed at how many disenfranchised players have popped out of the woodworks. Mr Mystery will probably pop up and claim it's just a vocal minority, but if it's not...

Wildeybeast
05-25-2014, 02:56 AM
I think the idea of Visions being "recieved well" is, at best, amazingly generous. ;)

When it was released and replaced the traditional WD, GW was overwhelmed by subscription cancellations - I've heard quite a few people say that Apple reps were telling them that it'd been something of a tsunami of irritation and refund demands, which were handed back to GW for processing. Can't imagine readership's been great, given that.

That said, this probably isn't a big deal for GW either way. Visions appears to exist primarily as a low-cost way to run out existing WD subscriptions while a separate, weekly sales channel was opened with WD Weekly. I fully expect Visions to exist for around as long as it takes to fulfill existing subscriptions, then be quietly retired.

As to GW's health overall, I think we'll just have to wait for the next financial statement before coming to any useful conclusions.

That idea falls down on the fact that there a not insignificant number of people still on the old direct debit subscriptions. Those never run out, they just keep going until we cancel them. And when I'm paying £9 a quarter for a £7 a month magazine, I'm not cancelling it, even if I never read the thing. They've changed WD a number of times over the life of my subscription, so I'm hanging onto it to see what comes next.

Also, the idea that they would got to the time, effort and cost of producing a deliberately bad magazine is pretty tin foil hatish. The only reason they switched subscriptions to that rather than WD weekly is cost. Shipping out WD weekly on a subscription basis quadruples (probably more when you factor in the workload of doing so) their shipping costs, something that simply wouldn't be covered by the existing subscriptions.

Mr Mystery
05-25-2014, 10:28 AM
We'll see the fallout of 7th, too. I'm amazed at how many disenfranchised players have popped out of the woodworks. Mr Mystery will probably pop up and claim it's just a vocal minority, but if it's not...

I don't pop up. I positively lumber around.

And you know, this happens with every single edition.

What ultimately matters is can GW recruit gamers faster than gamers move away. For me, I think they can. Certainly in terms of personal anecdotes, all the GW's I've worked in over the years (Tunbridge Wells, Brighton, Stockport, Blackpool, Epsom and Northampton) had no difficulty recruiting players. Most weeks I'd personally sell two full starter sets.

When people start moving away from any given game, it's hard to retain them all, as they're going for a raft of different reasons, and sometimes conflicting reasons (between different players, not with an individual).

DarkLink
05-25-2014, 12:42 PM
You literally just posted in another thread that "the plural of anecdote is not data". And, no, it doesn't happen with every edition. I mean, there are people who like and dislike the changes, sure. But for the first time ever since I started playing 40k, I've seen a huge number of players not complaining, not raising an eyebrow as a change they didn't like, but throwing up their hands and quitting. And with prices going up and up, how many new players are going to chose to play 40k over one of dozens of much cheaper, higher quality games?

We can't say yet, but this is a big turning point for GW. If this doesn't go well for them, it could easily break them in the long run. There were never any real competitors to 40k until very recently, and now that veteran players are discontent and moving to other games, who's going to recruit? GW certainly won't, at least not anywhere outside of maybe Nottingham. Kids will come into a game store and ask about the cool models, and be told to pick up Infinity or X-Wing or Warmahordes or Malifaux or Drop Zone Commander or... you get the point. Not that GW is going to go out of business of anytime soon, but outside of GW's home turf, it's not looking particularly rosy, and it looks like 7th is simple a doubling down on the design flaws that put them into this position in the first place, rather than a meaningful attempt to regain what they've lost.

Mr Mystery
05-25-2014, 01:51 PM
How many Darklink? Present the data. How many have actually quit? Or is it the same old bluster we see with every single change, people saying they're going to quit, and then you know.....not.

And GW will be recruiting players. That's what they're own stores do. And if it's game store owners trying to drive people to cheaper games which require fewer models...they may want to go and get their bumps felt, because you know, that's risky to their own bottom line.

Not every game appeals to everyone. Take Warmahordes. I've tried it, and didn't like the system, nor am I much of a fan of their design ethic. X-Wing? I am tempted, and have been asking around in our Star Wars forum. Trouble is, I need to get friends into playing it to really make it worthwhile.

As for the anecdote? I did kind of point out that it was an anecdote, which you know, kind of automatically precludes any assertion that I'm claiming it to be universally true.

Lexington
05-25-2014, 03:27 PM
That idea falls down on the fact that there a not insignificant number of people still on the old direct debit subscriptions. Those never run out, they just keep going until we cancel them.
Not insignificant, no, but also probably not highly significant, either. More, that's money that they get reliably, but unlike lump-sum subscription money, it's not anything they'd have to give back, as they would have been forced to do if they'd simply cancelled people's subs. Given the financial situation at GW lately, I'm sure that didn't come up as an option.

So, yes, just like you said - it was financially infeasible to just switch existing subscribers to the weekly White Dwarf format, so they made a new magazine instead. A low-cost glossy mag using recycled/unused photography, user submissions and a few existing WD components. It costs almost zero to produce outside of basic assembly and physical production costs, gives existing subscribers a product that can be defended as an equal exchange, plus sells for a high price to the few stragglers who bother to pick it up from a store. Not a bad idea overall, but it is what it is - a method to keep from having to refund their entire subscription base. Instead, they took a loss from those seeking active refunds, and kept those who haven't been paying attention, or from customers like yourself.

Really, the alternative is that some people at GW sat down in a room and said "you know what our customers really want? Contextless catalogues of Studio armies and rejected WD Battle Report photos. Growth market right there." Talk about your wacky conspiracy theories...


We can't say yet, but this is a big turning point for GW. If this doesn't go well for them, it could easily break them in the long run.
Yeah, it could very well spell bad news. I like 7th Ed 40K overall (besides the 'everyone summons Daemons' nonsense), but the reaction I've seen feels a lot like the reaction to 8th Edition Fantasy, and we all know how that turned out for GW.

Denzark
05-25-2014, 05:48 PM
Yeah, it could very well spell bad news. I like 7th Ed 40K overall (besides the 'everyone summons Daemons' nonsense), but the reaction I've seen feels a lot like the reaction to 8th Edition Fantasy, and we all know how that turned out for GW.

How did it turn out, did they all get made redundant and the company get sold to Hasbro?

DarkLink
05-25-2014, 07:14 PM
How many Darklink? Present the data.

You are putting words in my mouth. I am saying that it might turn out badly, and that it could. You refuse to consider that possibility. I get that you're optimistic and all, but don't be so naive to think that widespread discontent on the internet can't possibly translate to real world discontent. Sure, it doesn't necessarily mean that it will, but if you're going to be like that then how about you present me the numbers for how many people


And GW will be recruiting players. That's what they're own stores do.

And here's you're problem. You don't seem to realize that there's this whole big world out there outside of the UK. America is roughly a third of GW's market, Europe is about 30%, and Australia is like 10%, based on the allocation of the amount of product GW ships out to each geographic location. I don't know about Europe, but in the USA GW might as well not have stores, and I'm pretty sure the same is true of Australia. The rare store that supposedly does exist is basically limited to one-man shops with extremely limited hours. Within 100 miles of my location there are, I think, two GW stores. There are about 40 non-GW stores that stock 40k, and about a dozen that would qualify as flgs where you can show up and play a pick up game or attend a tournament or something.


Not every game appeals to everyone. Take Warmahordes. I've tried it, and didn't like the system, nor am I much of a fan of their design ethic. X-Wing? I am tempted, and have been asking around in our Star Wars forum. Trouble is, I need to get friends into playing it to really make it worthwhile.

There are a ton of games out there, and in terms of quality 40k is frankly pretty low on the totem pole. The other communities are growing steadily. If 7th fumbles like Fantasy has globally over the last few years, how long before it's 40k that you have trouble finding a game for while, say, Warmahordes is everywhere.


I did kind of point out that it was an anecdote, which you know, kind of automatically precludes any assertion that I'm claiming it to be universally true.

My point was you were being a hypocrite. Don't disagree with someone over anecdotal evidence, then base part of your argument on it.

daboarder
05-25-2014, 07:41 PM
I don't know about Europe, but in the USA GW might as well not have stores, and I'm pretty sure the same is true of Australia.

Actually we have quite a large number of GW stores, but I think we only have 2-3 bunkers in sydney and maybe another 2-3 in the rest of the country, most stores are holes in the wall with 2 demonstration tables.

What we have seen in sydney is a huge rise in the number of other gaming stores such as good games and the like.

I think the most telling thing about the Australian market however is the tournament scene. the Aus scene has always been somewhere between US and UK in terms of competitiveness but due to geography our tournaments have usually been able to pull fairly large crowds (120-160 about 5-6 times a year) in the last 2 years however we've seen a HUGE drop in tournament attendance (down to 30 or so), so much so that many of those organizing are starting to ask themselves why bother.

I dont know how I would clarify the health of 40k in austraia, but 7th really is starting to push anyone looking for more than just a dice throw into other games. I've had 4 mates out of a group of 15 put multiple armies up for sale or trade in the last week because they are tired of the arms race and GW business practice.

Very few people in Aus buy direct from GW (and you can check their annual reports they are down something like 30% sales volume in aus compared to 3 years ago) because 1) its ridiculously expensive out here, 2) the second hand market is glutted.

Lexington
05-25-2014, 08:55 PM
How did it turn out, did they all get made redundant and the company get sold to Hasbro?
No, but if the health of the company is at all related to that of their weird little partisan cult on these boards, that message is a pretty grim harbinger.

But, for anyone who hasn't heard about Warhammer Fantasy's woes since 8th Edition was released, it's dropped out (http://www.belloflostsouls.net/2014/03/wargaming-and-top-5-games-are.html) of the top five miniatures games for North American independent retailers, and things are so bad that even Forgeworld's stopped bothering (http://www.lounge.belloflostsouls.net/showthread.php?45338-No-more-new-Warhammer-Forge) to produce new product for the game. If 7th Ed 40K goes the same route, I doubt any other company, Hasbro included, would even bother trying to pick up the pieces left over from GW's implosion.

daboarder
05-25-2014, 08:57 PM
nah the IP has shown itself to be very very valuable. just look at the success of the GW video games licencing (DOW and Space Marine)

DarkLink
05-25-2014, 09:05 PM
At the beginning of 5th, we had a local tournament draw 90 players. The one this weekend had 32. Now, the average certainly isn't 90, and the tournaments are still going strong, but they've been generally on the low side and we have extremely heavy comp in place for this last year because 6th was so poorly balanced. And meanwhile, Warmahordes and Infinity have grown very large. There are technically GW stores in the USA, but they're so vastly outnumbered by flgs that it's a wonder GW wastes money trying to compete with the flgs here. GW does zero promotions, marketing, or anything of the sort beyond keeping store shelves stocked with models and White Dwarf. No event support, no tournament prizes, no painting classes, nothing. It's the community that brings in new players, and if the community shifts over to a different game, GW loses 20-30% of its revenue. If, and I say if, that happens, GW will not be a happy camper.

Excluding several glaring issues (terrible missions, daemonology, the psychic phase, the continued existence of deathstars), 7th is mostly just v6.1. So we'll likely just see TO's taking a red pen and crossing out a few sections of the rulebook and then the game will go on. It'll cost GW a few players, but as long as the community doesn't get too divided 7th shouldn't be much worse than 6th. It will just accelerate GW's market loss a little bit, so there probably won't be any rapid change in the next year or so other than the continued gradual growth of other games.

Denzark
05-26-2014, 08:02 AM
and things are so bad that even Forgeworld's stopped bothering (http://www.lounge.belloflostsouls.net/showthread.php?45338-No-more-new-Warhammer-Forge) to produce new product for the game.

Oh? And there was me thinking that it was a business decision based on how well HH was doing - so they consciously focus on that- not how badly WFB is doing. Did we not for years, debate on here how HH was 'a license to print money'?

DarkLink
05-26-2014, 10:13 AM
Fantasy doing poorly and HH doing well are not two contradictory things. I don't have a comprehensive global view of all of GW's sales, but literally everything that I've seen about Fantasy has been downhill. There are local strongholds, but they seem to be exceptions to an overall trend.

Lexington
05-29-2014, 09:29 AM
Reinholt over at Warseer - who runs a trading desk himself - has a pretty nice overview (http://www.warseer.com/forums/showthread.php?394884-Games-Workshop-Stock-Prices-The-Future-and-Cats-Without-Sufficient-Coffee) of his view on GW's situation, by way of response to Wolfshade's post/resulting BoLS article.

Wolfshade
05-29-2014, 10:19 AM
It is a nice post, and had I had known that it was to become an article it would have fleshed out the post more (or at least put it in context). Probably not as eloquently as Reinholt, but certainly less orange. If I am honest the original motivation was more of a rebuttle to the OP that was suggesting the end is nigh.

In the whole I agree with what he says, and he too is cautious to prognose what is happening based on localised fluctuations.

It is very important to note this comments:


Changing your customer segment while you have a successful and growing business to an untested one, which was not researched, based on whim of management? Stupid.
Not listening to internal concerns and instead silencing those people/firing them? Stupid.


GW's biggest issue is GW senior management. Yes certainly, you cannot lsiten to every person in the community, but if revenue starts to tumble you might need to dip your finger in and see what is being said.

I certainly see the yardstick for recover growing at the same speed as the sector, though what that sector is and how you define it (outside of stocks and shares) is a little difficult. What I don't think will happen (even if GW do make an upturn in growth) is see as strong growth as back in 2nd/3rd the world is very much a different place. GW have seemed to failed to get the internet (like a lot of companies) and I am concerned that they are actually much closer to market saturation now then they were, that is a small product can very rapidly grow inexcess of 100%, but in terms of actual numbers that is still very small, whereas GW is larger so while they may grow faster (in raw numbers) their % will be much lower.

One thing I would take issue with is the dropping in customer base. It is not that I do not believe it to be the case, it is just that there is insufficient data to actually make that comment. Revenue is falling, is that less customers spending the same amount or the same customer spending less. Eitherway, it is a problem, you are either stagnating (not growing the player base, i.e. what is preventing the growth, entry cost too high? complexity of rules? I don't know) or losing customers (which i think is worse, it isn't that you are aren't attracting new custoemrs you are actively lossing the existing ones.

Eitherway, like Reinholt, I doubt that we will see any see-change any time soon, and the next financials statements may be obscured by the drop of the new editions. What will be worrying is if they are not noticeably up on either the previous 6 months or the same period last year.

Cap'nSmurfs
05-29-2014, 10:36 AM
Speaking of companies that are in trouble because they never really understood the internet, you guys should check out what's happening with Future Publishing. Sad to see.

Wolfshade
06-20-2014, 06:41 AM
Games Workshop Group PLC announces that the Board has declared a dividend of 20 pence per share. This will be paid on 4 July 2014 for shareholders on the register at 13 June 2014.

Contrast that with last year:
Games Workshop Group PLC announces that today the Board has declared a dividend of 16 pence per share. This will be paid on 5 July 2013 for shareholders on the register at 31 May 2013.

So an additional 4p.
Is GW trying to raise revenue by making shares seem more attractive?
Is Kirby, with his large personal share trying to milk the cow before it dies?
Is GW internal results better than expected (those known to the board not the market)?

Find out the answer to at least 1 of these questions when the annual accounts are published.

Mr Mystery
07-19-2014, 07:16 PM
When are the accounts to be published?

Wolfshade
07-21-2014, 02:26 AM
End of July start of August normally.