Last close As at 05/08/2026
GBP190.10
▲ −20.00 (−0.11%)
Market capitalisation
GBP6,282m
Research: Consumer
Games Workshop Group (GAW) enjoyed a signature record year in FY24 with the launch of the 10th edition of its largest intellectual property (IP), Warhammer 40K, and strong growth in licensing income. Looking to FY25, management has an ambitious plan for growth. However, it also highlights the challenge of generating year-on-year growth given: 1) 40K is larger than Age of Sigmar (AoS), the fourth edition of which has been launched, and 2) the tough comparative for licensing income, which has a high operating margin. In FY22, the year the prior edition of AoS was launched, core operating profit was broadly flat year on year (negatively affected by higher freight costs and stock provision) on 11% revenue growth, both at constant currency. Our estimates are under review.
Games Workshop Group |
Another record year in FY24 |
FY24 results |
Consumer goods |
31 July 2024 |
Share price performance
Business description
Analysts
Games Workshop Group is a research client of Edison Investment Research Limited. Opinions and forecasts represent the Edison Research department’s view. |
|||||||||||||||||||||||||||||||||
Games Workshop Group (GAW) enjoyed a signature record year in FY24 with the launch of the 10th edition of its largest intellectual property (IP), Warhammer 40K, and strong growth in licensing income. Looking to FY25, management has an ambitious plan for growth. However, it also highlights the challenge of generating year-on-year growth given: 1) 40K is larger than Age of Sigmar (AoS), the fourth edition of which has been launched, and 2) the tough comparative for licensing income, which has a high operating margin. In FY22, the year the prior edition of AoS was launched, core operating profit was broadly flat yearonyear (negatively affected by higher freight costs and stock provision) on 11% revenue growth, both at constant currency. Our estimates are under review.
Year end |
Revenue (£m) |
PBT* |
EPS* |
DPS |
P/E |
Yield |
05/22 |
414.8 |
158.1 |
394.6 |
235.0 |
26.2 |
2.3 |
05/23 |
470.8 |
171.6 |
411.8 |
415.0 |
25.1 |
4.0 |
05/24 |
525.7 |
204.2 |
460.9 |
420.0 |
22.4 |
4.1 |
05/25e |
534.5 |
198.4 |
451.1 |
420.0 |
22.9 |
4.1 |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.
Core revenue of c £495m and licensing revenue of £31m both grew strongly, c 14% and 29% at constant currency, respectively. Core’s growth was relatively consistent between H1 and H2, and much stronger for Trade and Retail (c 16%) than Online (c 1%). Licensing had a very good H224. It grew by 29% in the year following a 13% decline in H124, benefiting from a high level of guarantee income on multi-year contracts signed in the period and reaching an all-time high.
On an underlying basis, core gross margin increased by 190bp to 68.4% (FY23: 66.5%), with the main drivers being a reduction in the inventory provision and carriage costs versus the prior year. The launch of a new edition of GAW’s most significant IP, Warhammer 40K, typically drives a year-on-year improvement in the gross margin.
The strong growth in total gross margin to 71.2% (FY23: 68.3%), helped by the greater contribution from higher-margin licensing revenue, and marginal increase in operating costs relative to sales (from 32.2% to 32.9%) led to strong constant currency growth in core and licensing operating profit of c 25% and c 31%, respectively. Reported growth would have been even better but for the strength of sterling, which diluted year-on-year operating profit growth by 7%, more than the 3% impact on revenue, which reflects the company’s high sterling cost base relative to its international revenue.
Free cash generation pre interest and after lease payments was broadly flat in absolute terms at c £152m but down relative to sales, mainly due to greater investment in working capital to improve product availability to customers.
Following the payment of dividends, which were at similar levels to the prior year, GAW’s closing cash position increased to c £108m from c £90m at the end of FY23. The company declared its first dividend of the year of 100p/share versus 145p at this stage last year, as well as an increase in its required cash buffer.
|
|
Research: Investment Companies
HgT has published its preliminary unaudited H124 trading update, reporting a 5.6% NAV total return (TR) in H124 (of which 3.0% was in Q124). HgT’s NAV TR remains primarily driven by the solid last 12-month top-line and EBITDA momentum, which stood at 20% and 25% to end-June 2024 across its top 20 companies (making up 78% of its portfolio value), compared to 24% and 29% at end-March 2024, respectively. Despite the still modest exit activity across the global private equity market, HgT collected £347m (or 15% of opening NAV) in proceeds from exits and refinancings in H124. Its discount to NAV closed recently, translating into a year to date share price TR of more than 20%.