Story in UK's Daily Telegraph
Games Workshop 'forgot core market'
By Richard Fletcher and Caroline Muspratt
Last Updated: 12:10am GMT 07/01/2007
It wasn't quite as grisly as one of the company's models: but a profits warning from Games Workshop wiped almost 10pc off its stock market value.
The former stock market darling – which was hit by the rise of Pokemon trading cards in the 1990s and a collapse in sales of Lord of the Rings characters two years ago – admitted that this time the mistakes were self-inflicted.
"We have not been paying enough attention to the hobbyists."We need to get back to our bread and butter," said Ted Kirby, chairman and chief executive of Games Workshop.
Games Workshop said that pre-tax profits rose slightly to £127,000 in the first half to November – up from £119,000 the year before.
However he admitted that sales fell to £54.8m, down from £57.1m the year before as shoppers rushed to buy the Nintendo DS Lite, rather than the latest Warhammer figurine.
"The pace of recovery is slower than we had been looking for," said Iain Daly, an analyst at Bridgewell.
The interim results and trading update prompted City analysts to slash profit forecasts for the full year by as much as 50pc.
Shares in the group fell 39p to close at 368p.
Games Workshop gained hordes of new customers following the release of the Lord of the Rings films in 2001-2003, but has since found that many quickly lost interest and deserted their new hobby.
"It was all a bit too easy. We forgot the basic skills," said Mr Kirby who blames the bubble caused by the Lord of the Rings for the group's current woes.
So did he enjoy the film? "Personally I preferred the book. But I suppose I shouldn't say that." [/b]
