Happy Friday!

Of interest today are:

Turning to yesterday's announcements, I would like to catch up on:



Games Workshop (LON:GAW)

  • Share price: 2900p (-5%)
  • No. of shares: 32.3 million
  • Market cap: £936 million

Trading Statement

This collectible wargames designer and retailer has confirmed that sales and profit growth has continued since May:

We expect the Group's sales for the 53 weeks to 3 June 2018 to be approximately £219 million and the Group's profit before tax to be not less than £74 million.

Some shareholders might have been misled by early headlines, e.g. this one:

5b1a559beefcbGAW_20180608_divi.PNG

It's easy to make mistakes when moving quickly. To be fair to the journalists involved, Games Workshop did not include any comparative figures in the RNS. That would have been helpful, and would have prevented the above mistake.

GAW has declared a 30p dividend, payable in July.

This is smaller than the March dividend (35p), but larger than the dividend paid in July 2017 (20p).

I've quickly checked the 2017 annual report. As far as I can tell, the company does not have a progressive dividend policy. Instead, it follows the principle of returning "truly surplus cash" to shareholders.

That's perfectly reasonable, and I wouldn't read too much into this 30p dividend, except that the company thinks it has 30p in spare cash per share.

It uses return on capital as a key performance indicator and has produced very attractive returns by this measure, and I am inclined to think it deserves the benefit of the doubt that it will be putting its retained earnings to good use.

Today's numbers are pretty much as were expected following the May update, so I don't think this is a major news story. The only unusual elements are the journalistic error re: the dividends, and the share price decline. It looks like some people were hoping for yet another upgrade.

I like this stock…

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