Soaring sales lift Games Workshop to record high MARKET REPORT
SHARES in Games Workshop jumped to a record high as investors cheered the prospect of increased revenue and profits.
The retailer, which sells the popular Warhammer figurines and other miniatures, now expects sales for the six months to December 1 to hit £140m, up from £125.2m in 2018. The Nottingham firm also said it expects profits for the period to be at least £55m. During the same time last year, it posted profits of £40.8m.
The brief but upbeat announcement sent shares soaring 19.3pc higher, or 869p, to 5375p, eclipsing a record of 5160p in June.
Shares have risen more than sevenfold since trading at just above 700p at the start of 2017, with the company now boasting a market capitalisation of £1.7bn.
Russ Mould, investment director at AJ Bell, said Games Workshop ‘couldn’t be more niche if it tried’ but appeared to have found a winning formula.
He added: ‘The fantasy world seems less susceptible to going in and out of fashion, and that should enable the company to keep delivering the magic.’
Globally, the mood was glum after Donald Trump poured cold water on suggestions that the US and China had reached a trade truce. Stock markets have risen this week, partly fuelled by reports that the two sides had finally agreed to start reducing tariffs.
But the US President sent shares spiralling down again as he insisted that was not the case.
It contradicted a statement by Beijing claiming that negotiators had agreed to wind down tariffs ‘in phases’ based on progress towards a trade deal. The spat weighed on the
FTSE 100, which fell 0.6pc, or 47.03 points, to 7359.38. The FTSE 250 was down too, drifting 0.4pc or 75.59 points, to 20,357.63.
Airlines led the losses. Budget operator Easyjet tumbled 2.6pc, or 35p, to 1303.5p after snapping up airport takeoff and landing slots that previously belonged to travel operator Thomas Cook, which went into insolvency in September. The slots at London Gatwick and Bristol airports cost £36m, Easyjet said.
Jet2 owner Dart Group also joined the action, buying some of Thomas Cook’s former slots at Manchester, Birmingham and London Stansted for an undisclosed price. The move sent its shares down 0.3pc, or 4p, to 1279p.
At British Airwaysowner IAG, the forecasts for seat capacity over the next three years were slashed, a sign of pressure on the airlines industry.
Many firms are struggling to maintain profits in the face of overcapacity and a weak global economy – a scenario that has triggered a price war to fill empty seats. IAG said passenger numbers rose to 10.3m in October, up 3pc on the same month in 2018.
However, this was a slowdown compared to growth of 4.7pc for the first nine months of the year.
That prompted it to trim its earnings growth forecast from 12pc to 10pc.
Willie Walsh, IAG’s boss, told analysts: ‘We still see growth but we’re moderating our growth.’ Shares fell 0.6pc, or 3p, to 541.6p.
Over in the insurance industry, professional services provider
Charles Taylor surged 10.1pc, or 32p, to 350p after securing a better offer from its proposed buyers. It had agreed to support the sale of its shares for 315p each to Lovell Minnick – but it has since managed to negotiate a higher price of 345p per share.
Specialist insurer Beazley climbed 7.1pc, or 38p, to 577p despite saying it expected profits to be hit by the US hurricane season. It has set aside £63m for claims but said premiums written rose to £1.7bn in the nine months to September 30, up from £1.5bn over the same period last year.