Games Workshop puts up quarterly dividend by 20%

Shares of Games Workshop fell nearly 10 percent on Wednesday as the retailer announced weaker earnings in the past three months.

However, in a trading update, the group has also increased its dividend by 20 percent and will now pay shareholders 30 pence per share for the three months to August 28.

After making a payment of 90 cents a share last week following record-breaking full-year results, that means the total dividends paid to the company’s investors so far this fiscal year are nearly double what they were 12 months ago.

Known for the Warhammer series of table games, Games Workshop has seen commerce surge during the Covid-19 crisis as consumers sought to keep themselves occupied and spend more time indoors.

Despite the easing of lockdown restrictions, the Nottingham group’s sales continued to grow, albeit at a much slower pace than before.

For the most recent quarterly period, it reported license sales fell to around £3 million, from £5 million in 2021, although this was offset by core revenues rising to around £106 million.

However, pre-tax profits fell 13 percent to around £39 million. Following this revelation, Games Workshop shares fell 9.1 percent to £64.15 in early afternoon trading, meaning their value is down more than a third this year.

Victoria Scholar, chief investment officer at Interactive Investor, said shareholders have “been having a rough time” with the company’s stock decline over the past year and a succession of price cuts by analysts.

Nevertheless, she noted that this stock has been on a positive trajectory over the long term and has “outperformed significantly” the broader FTSE 350 index.

The group has delivered 2,630 percent return on shareholder value over the past decade, according to figures from investment platform AJ Bell, the second strongest performance of any midcap company listed on the London Stock Exchange.

Chief executive Kevin Rountree has been credited with turning Games Workshop’s fortunes around since he took charge in 2015.

He restored the company’s relationship with many fans alienated by its aggressive approach to protecting intellectual property rights, and launched or reintroduced more simplified games that were popular with customers.

One was Blood Bowl, an American football-inspired board game where players aim to score as many touchdowns as possible with a team of fantasy creatures.