Games Workshop shares (LON:GAW) surged on Friday after the group unveiled robust activity during the coronavirus lockdown.
The UK Investor Magazine previously highlighted Games Workshop as one of the hobbyist companies that would benefit from the coronavirus lockdown as model makers took advantage of spending more time indoors.
On Friday, this was confirmed when the Games Workshop made a sharp revision to their pretax profit for the year to 31st May 2020.
Games Workshop shares were over 10% higher to 7,855p on Friday and are 28% stronger year-to-date.
Profit Jumps
In April, Games Workshop released a trading statement guiding for pre-tax profit of £70 million. Today’s announcement said pretax profit would be no less than £85 million, signalling elevated sales during the coronavirus lockdown.
Revenue for the year to 31st May 2020 will be circa £270 million, substantially ahead of 2019’s £256m.
Games Workshop said they had opened 306 of their 532 stores across 20 countries whilst adhering to local social distancing.
“Following our announcement on 28 April 2020 we have continued to re-open our operations globally, in line with local guidance, whilst ensuring our priority is the health, safety and wellbeing of our staff and customers,” Games Workshop said in a statement.
“Our warehouses are now operational and our factory is working in a limited capacity, at all times complying with the social distancing and hygiene requirements in each country. Trade and online sales orders are also being processed as these staff currently work from home.”
Games Workshop produces ‘Warhammer’ models that can be used in war games and are commonly referred to as ‘plastic crack’ due to the pull the products have on enthusiasts as they seek to expand their collection and compete in competitions.
Many of the products on the Games Workshop were out of stock for a period at the start of the lockdown, and although there were initial concerns over Games Workshop being able keep production facilities open to fulfil demand, this seems to have been navigated with some success.
Game Workshop also has a strong digital product that represented roughly 20% of sales in 2019, which is likely to have seen greater activity through lockdown.
