Shares in Games Workshop declined following the company’s warning that US tariffs and rising plastic costs could negatively affect its profits, despite reporting strong overall financial results for the year ending May 31. The Nottingham-based maker of Warhammer miniatures and games highlighted challenges including trade levies imposed under former US President Donald Trump and supply chain disruptions linked to the Iran War, which have increased material costs.
Games Workshop stated that tariffs could cost the company approximately £13 million in the current tax year. Last year, the firm paid around £12 million in tariffs but successfully reclaimed £7.8 million after many were ruled unlawful. Additionally, it anticipates a £2 million impact from higher plastic prices, driven by energy market pressures. Chief Executive Kevin Rountree, who described the year as unexpectedly turbulent, emphasized that pricing and operational adjustments would help mitigate these costs.
Despite these headwinds, Games Workshop reported a record pre-tax profit of £275.7 million, a 4.9 percent increase from the previous year, supported primarily by its core miniatures business. Revenue from this segment grew 10.9 percent to £626.8 million, with operating profit rising 15.7 percent to £245.1 million. Overall revenue increased 6.8 percent to £659.7 million.
However, the company experienced a notable 37 percent drop in licensing revenue, falling to £32.9 million from £52.9 million the year before. Licensing operating profit also declined to £29.9 million from £49.5 million. The licensing division, responsible for granting third-party companies rights to develop Warhammer-based products, had previously cautioned investors against expecting a repeat of prior strong performance driven by the release of the video game Space Marine 2. This title, launched in the previous financial year, had significantly boosted royalty income.
Games Workshop reiterated its commitment to expanding the Warhammer franchise through planned film and television adaptations, secured via a long-term agreement with Amazon. The projects remain in development with actor Henry Cavill attached and involvement from United Artists and director Mike Flanagan, though the company noted that such adaptations would take several years to reach the market.
On the stock market, shares fell as much as 6.5 percent following the tariff and cost warnings but closed down 0.9 percent at £20.04. Over the past year, shares have gained more than 28 percent, reflecting sustained investor confidence. The firm declared a dividend of 140p per share recently, bringing total payouts for the current financial year to 230p, up from 140p at the same stage last year.
Founded in 1978 and listed on the London Stock Exchange since 1994, Games Workshop joined the FTSE 100 index in December 2024, buoyed by growing international demand for its products. It now operates over 550 stores worldwide, including locations in Germany, Japan, and the United States.
Rountree described the Warhammer hobby as “in great shape” and characterized the financial results as reflecting “another good performance from the core business.” However, he did not provide detailed guidance for the coming year, leaving some uncertainty about how ongoing trade challenges will affect future profitability. Analysts have generally reacted positively, noting the underlying strength of the company’s performance amid these external pressures.