Games Workshop, the home hobby business, has reported a dip in profits despite record-breaking sales.
The Nottingham-headquartered group behind the Warhammer brand said it had been hampered by months of Covid restrictions which CEO Kevin Rountree said at times felt like operating with “one arm tied behind our backs”.
The business, which makes and sells miniatures, books, games and paints, said it had battled lockdown restrictions at home and abroad, but had worked hard to look after its workers – even encouraging them to “do the right thing” and have Covid-19 vaccines.
It also had to soak up additional Brexit–related shipping costs of £2 million in the six months to the end of November and was dealing with delays in VAT repayments from some European countries.
In a trading update the business said it hit revenues of £191.5 million in the six months to late September, up almost £5 million on a year earlier.
Pre-tax profits were £88.2 million, down from £91.6 million.
Mr Rountree said, nevertheless, the business was in “great shape”.
He said: “Thanks to a resilient and engaged global team, we have had another great six months. We continue to deliver the day job – designing and making the best miniatures, books, games and paints in the world.
Most Read
“With a relentless focus, we continue to support our existing customers and build new communities of like-minded Warhammer hobbyists.
“This despite, on occasions, having one arm tied behind our backs e.g. global travel restrictions and our retail recruitment offer has been compromised for some time.
“We are proud and humbled most days with the feedback that we receive – particularly that the Warhammer hobby continues to be a happy place for most people.”
He added: “Our number one priority during the period has remained the health, safety and wellbeing of our staff, their families and our customers.
“We are still operating with additional safety measures in place, e.g. social distancing, and we continue to encourage face coverings in areas such as our factories.
“We have actively encouraged our staff to do the right thing for themselves and their colleagues – having the Covid-19 vaccines is top of the list, and we mandate they follow all local government guidelines.
“We continue to pay all our staff fully, even when the virus forces them to temporarily sit at home.”
Don’t miss
Mr Rountree said despite ongoing Covid-19 restrictions at home and abroad, the business was getting back on a level pegging, with most facilities pretty much back to normal.
Major projects were being worked on again, he said, including 海角视频 staff flying out to Memphis in the States to get a warehouse there fully operational.
He said: “We are hopeful we can clear back orders and reduce delivery times in the next month or so.”
Russ Mould, investment director at stockbroker AJ Bell, felt Games Workshop had “come up short” in the latest results.
He said: “The fantasy miniatures firm has lost some of its momentum in recent months as it has struggled to keep up with the market’s elevated expectations amid global supply chain disruptions and higher costs.
“And while the company says it is performing in line with expectations there may be some nervousness now that its second half isn’t sufficiently heroic to make up for a limp first half.
“Potentially more serious have been reports of fractures between Games Workshop and its devotees, linked to the launch of a subscription-based service and the aggressive protection of its intellectual property by pursuing YouTubers who have created Warhammer-inspired animations and stories.
“While it is understandable that Games Workshop is protective of its IP, it needs to tread carefully. The value of the company is inextricably linked to fans’ devotion to the Warhammer brand.
“Key areas of excitement for the business longer term are the licensing and royalty opportunities associated with video games as well as TV and film productions. These revenue streams are highly profitable as they typically involve limited costs for Games Workshop itself.
“Games Workshop is already fairly advanced on the video games front, however, comments from the company that it remains ‘ambitious and patient’ when it comes to media and entertainment opportunities suggests this area won’t see an overnight success.”
Sign up for your free East Midlands newsletter and follow us on LinkedIn
Email newsletters
BusinessLive is your home for business news from across the East Midlands including Leicestershire, Nottinghamshire, Derbyshire and Lincolnshire.
Click through here to sign up for our email newsletter and also view the broad range of other bulletins we offer including weekly sector-specific updates.
We will also send out 'Breaking News' emails for any stories which must be seen right away.
For all the latest stories, views and polls, follow our