Games Workshop Share Discussion Threads

[suetballs] 27/3/2020 16:17

The price is "low" and as with many shares I expect to see a considerable upside once the number of virus cases begin to level off / fall.
I never expect to get in at the bottom but these shares will fly again.
I'm not in yet.
Suet

[stewhg76] 27/3/2020 15:37

Why do they look attractive at this point? Just interested you know your thinking?

[suetballs] 27/3/2020 11:52

Have been a fan of these for a long while and at this price they look attractive.
Suet

[nod] 26/3/2020 10:09

Now would be a good time to release the Angels of Death TV Series. It was due last year but delayed. Bowman Modine and Richard Boylan are Directors.

[nod] 24/3/2020 20:42

The independent stores that continue to operate online will run out of stock, as the GW warehouses are to be closed.

[nod] 24/3/2020 20:31

Remember, GAW's stores are hobby centres and the primary purpose is to recruit new customers. The stores only stock a narrow range of products, which can be purchased online.For many years our own stores were operating at around break even or a small loss. It's only been the past few years that own store sales have generated a profit. Fingers crossed this crisis will be over in a few months.

[shanklin] 24/3/2020 14:36

Could not access Robin's link directly but did come across it by googling "financial times games workshop peel hunt".

Not too sure about copyright, this appears to be PH text reproduced verbatim by FT Alphaville...

"GAW has deemed its operations non-essential and has closed the business until further notice. This will reduce sales by c£23m per month. Monthly costs are c£16m, which will be reduced significantly with the government subsidies. It has a May year end, so a significant proportion of the impact will be in the current year, but there will be a knock-on into next year even if able to resume before year end. Cash is >£30m and GAW will look to reduce cash burn and have funding lines in the short term. We have no doubt the company will emerge from this period having built engagement with its hobbyists and with renewed energy for growth.

[O]ur assumptions are that: The business is closed through to the end of June; Sales run at half speed for the following three months as the company resumes production and re-stocking takes place.

Clearly there is a high degree of uncertainty in forecasts. For example, it could see a surge in orders when re-opening due to pent-up demand. On the other hand, it may have trade accounts that have gone out of business or have reused the space given to Warhammer.

Impact on numbers

We show below our first thoughts on the impact of running the scenarios above.

 2020E – We assume no sales and that the level of costs is halved (ie £16m per month reduces to £8m). We have made no change to our royalties forecast as most of this year’s total was booked in H1.

 2021E – As above, we are assuming that the business restarts at the beginning of July, so there is only one month of government support. We are then assuming three months of sales running at 50% of prior levels as the business gets back up to speed. There will be a period of re-stocking the trade, so this may be too cautious. We have taken off £5m from royalties (from our estimate of £10m) to account for delays in being able to sign-up agreements. This also may be too cautious – the period of WFH may actually give the opportunity to focus even more on licence agreements. We have reduced costs by £18m, with one month covered by government subsidies, a reduction in expenditure on growth (eg store expansion) and a reduction in bonuses.

 2022E – We have assumed that sales are 10% lower than our previous forecast to take into account a slower rate of opening and disruption to the trade channel. The 2022 cost reduction assumes fewer new recruits than previously expected and lower increases in salaries."

[cockerhoop] 24/3/2020 14:35

Martin,

It's in the link robin placed above at 12:30 on the feed FT alphaville is free to access.

[shanklin] 24/3/2020 14:22

It strikes me as remarkably incompetent (and I say this as someone who is generally very positive about GAW management) for GAW not to have provided full disclosure to the market via an RNS.

Just providing this information to PH, which not all of us can access, is disgraceful.

Obviously I would be grateful for any excerpts readers of said note would be prepared to share.

[cockerhoop] 24/3/2020 14:16

Nimbo1,

The PH note says they have short term funding lines in place along with >£30m cash.

[nimbo1] 24/3/2020 14:12

Shanklin I agree - Gaw is extremely attractive here if the world goes back to normal.

However its cash balances are in the back of my mind, I wish they had debt facilities in place incase they are necessary - time to delve into an annual report!

[robinnicolson] 24/3/2020 13:48

Peel Hunt note on the RNS (12:30 time stamp)

[shanklin] 24/3/2020 13:34

P.S. Apart perhaps from GAW's small size, it would not surprise me to find funds with a Buffetology slant being extremely keen to add at these levels.

[shanklin] 24/3/2020 13:31

I have made this point via email to the IR email address given. I would encourage others to do the same especially as I expect they did not mention it is that they do not foresee a cash flow issue unless this goes on for many many months.

[nimbo1] 24/3/2020 13:12

agree - its one thing playing it cool information wise when times are good but when certainty is required todays update was not helpful!

[shanklin] 24/3/2020 12:28

Obviously its a positive that trading in December - February was "in line with expectations".

I do think GAW should have:
- detailed their cash position as of say end-Feb
- given shareholders an idea of their potential monthly expenditure whilst in shutdown (quite possibly vague due to the absence of clarity in some countries in which they operate
- talked about their ability to access debt finance should that prove necesary

The first of the above can be estimated from H1 results and broker forecasts; the second is where I have difficulty generating an estimate; the third may be totally irrelevent... ...but I would much rather be given the information and be able to form my own opinion.

[macc2] 24/3/2020 12:06

Today's trading update is I suppose much as expected but no encouraging words.

[nod] 24/3/2020 10:27

Countries will start to come out of this on the other side of the bell curve - which varies by country. China and South Korea are on the other side. The two markets most important for GAW are the USA and UK. I'm somewhat pessimistic that the USA and UK are ahead of the curve. Both leaders are prone to pantomime rather than disease control. It's difficult to get a handle on facts.

[nimbo1] 24/3/2020 08:52

to state the obvious it's a case of how long all this goes on for.

Market looks to have priced this in already - not too much surprise there.

[thewheeliedealer] 23/3/2020 23:22

Hi all,

My mate Peter @Conkers3 and myself did 2 Twin Petes Investing Podcasts a few days ago in a Special Double-Bill and GAW was one of the Stocks that we discussed. We also talked in depth about the current mess in the Markets and how we expect things could play out. Anyway, if you use Apple or Audioboom you can find them under the 'Conkers Corner' Channel (you want TPI Podcasts 19A and 19B) and you can find them on Soundcloud at the links below.

Cheers, WD
@wheeliedealer

[norbert colon] 23/3/2020 19:34

12th April last year and 4th May in 2018

[smilerrr] 23/3/2020 17:08

It feels like I sometimes miss messages on here - I am looking on the "share chat" page. Is there another source of messages I can see?

Finally - are we due a TU and news on divi soon? Are we expecting the next "due" divi to be cancelled?