Just to say that although GW only made an estimated £100K profit on a turnover of some £51m, they are one of very few retailers in the UK at the moment to make a profit at all.
The UK retail market at the moment is in a very steep decline, with many companies making huge losses year on year, especially in comparison to online shopping. Although there has been a small increase in year on year sales for the UK market in the post Christmas Sales many companies are reporting no growth whatsoever.
In short, for a UK company to announce a profit at this time should not be taken lightly, even if it is only a small one.
The other thing to notice with regards to GW is that on a turnover of £51m they have a profit margin of 70%, possibly the highest of any high street retailer. The reason they are only announcing small profits is that they have invested huge sums of money into their Esatate (new stores) and their product line (new plastics, new Warhammer).
This means that they do not have to give back huge chunks of their sales profits back to their shareholders as dividends, and means that they can invest the last remaining dregs of the LOTR cash cow into creating new technologies (CAD plastic tooling) and setting up better supply chain and widen their store base. They know that they will not have the money for this when the LOTR bursts (if it hasn't already) so they are pouring all their profits into the company while they can.
In short, this means that they know they have neglected their core customers by concentrating too much on new gamers and the Lord of the Rings license, but know that this license (which they invested huge sums of money into) is about to expire. This I think means that we can look forward to a brighter future.
It's just a shame that the share price has dropped by nearly 10%, as I have quite a few of the buggers!!
