Sales drop at Games Workshop
Games Workshop has revealed a drop in revenue of £2.5m for the six months to 28 November 2010. The Nottingham-based company, which produces collectable figurines for Lord of the Rings and Warhammer games, had issued a profits warning earlier this month. The company said it would now concentrate on investing in its one-man ‘Hobby Centres’ after pre-tax profit fell by more than £1m.
The company announced its six-month results through the London Stock Exchange this morning. Revenue stood at £60m for the period, a drop of more than £2m against the comparable 2009 result.
Pre-tax profit also dropped by £1.2m to £6.7m for the six month period. Operating profits was down to £6.7m, from £8.1m in 2009.
Earlier this month, the company issued a profit warning, stating that it was unlikely to make up lost ground after a slow Christmas period.
At the time, the company said in a statement: “The board of Games Workshop currently believes that, as a result of reduced volumes, pre-tax profits … are unlikely to meet current market consensus estimates.”
The company had already suffered a drop in shares of 12 per cent after the profit warning was issued. This morning, they had fallen from 21.5p in the comparable 2009 period to 15.3p.
This morning, Mark Wells, chief executive of Games Workshop, said: "Sales fell by 4 per cent although this was largely offset by gross margin improvements. Efficiency initiatives were implemented in both sales and manufacturing operations. Pre-tax profit was down £1.2m to £6.7m. The focus remains on investing in Hobby centre openings and improving retail volume. Cash generation remains strong.”
