Last close As at 05/08/2026
GBP190.10
▲ −20.00 (−0.11%)
Market capitalisation
GBP6,282m
Research: Consumer
Games Workshop Group’s FY26 trading update indicates another year of strong growth, beating our prior estimates. To have exceeded FY25’s profit with a much lower contribution from high-margin licensing in FY26 is a great performance on the back of the strong performances in FY24 and FY25, which benefited from the launches of new editions of Warhammer 40K (40K) and Warhammer Age of Sigmar, respectively. The coming financial year will see the launch of the 11th edition of 40K, keeping to the recent three-year cycle for new releases, so investors will be eagerly watching to see how well this is received by hobbyists.
| Year end | Revenue (£m) | PBT (£m) | EPS (£) | DPS (£) | P/E (x) | Yield (%) |
|---|---|---|---|---|---|---|
| 5/24 | 525.7 | 203.0 | 4.58 | 4.20 | 42.8 | 2.1 |
| 5/25 | 617.5 | 262.8 | 5.94 | 5.20 | 33.0 | 2.7 |
| 5/26e | 657.0 | 266.1 | 6.04 | 4.85 | 32.5 | 2.5 |
| 5/27e | 688.3 | 268.8 | 6.10 | 5.20 | 32.1 | 2.7 |
Core revenue is stated to be not less than £625m (FY25: £565.0m), and licensing revenue is not less than £30m (£52.5m), a growth rate for core of at least 11% and a decline for licensing of c 40%, respectively. The decline in licensing had already been well-flagged given the exceptional performance in FY25. While the figures are ahead of or broadly in line with our prior forecasts of c £616m and £30m, respectively, they indicate a slowdown in growth in H226 for core revenue to at least 4% versus the 17% growth reported in H126. This reflects the phasing of releases in the prior year and the boost provided by the success of Space Marine 2 to the core ahead of Christmas. The indicated PBT of not less than £265m (FY25: c £263m) is also ahead of our prior forecast of c £250m. The implied H226 PBT margin of c 39% compares with H126's 42.4%. If we assume a licensing operating margin of 90% in FY26, we estimate core’s operating profit grew by c 11–12% in FY26, broadly in line with its revenue growth. This suggests the majority, if not all, of the absolute growth in core’s operating profit was generated in H126, which reflects the different level of profitability between H125 (36.4%) and H225 (38.5%).
We update our FY26 estimates to be consistent with the trading update. On the higher FY26 base, we retain our prior growth rate assumptions and margin for the core in our new FY27 forecasts. FY27 will see higher costs for the new factory, materials and carriage, due to the Middle East conflict, and investing in Japan as well as entering new territories such as South Korea and the Czech Republic. We trim our forecast for FY27 licensing revenue to keep it stable with FY26. While FY26’s profit is ahead of our prior forecast, we reduce our dividend forecast to 485p/share from 520p/share, which is in line with the cumulative dividends announced in the financial year.
The prospective FY27 P/E multiple is towards the high end of historical multiples.
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Research: Consumer
British American Tobacco’s (BAT’s) H126 trading update confirms the company is on track to deliver underlying operational guidance for the year. This is driven by an acceleration in revenue growth by New Categories, along with an increasing contribution, while there is a small decline in value share for Combustibles in its top markets. BAT is the fastest growing business in total nicotine in the US. Management is flagging that profit delivery for the year will be H2 weighted given an expected stabilisation of its performance in APMEA and the delivery of Fit2Win savings.