As non-essential retailers prepare to open their UK shops again, The Works and Games Workshop today shared insights on how their businesses have fared as a result of lockdown.
Games Workshop says now that more than half of its shops around the world have reopened its business is recovering better than expected.
So far 306 of the retailer’s specialist games shops are open in 20 countries, out of a total of 532 shops worldwide. It is selling online and to trade customers, with transactions being processed by staff working from home. Its warehouses are operational and its factory is working to a “limited capacity”. Games Workshop says all are operating in line with the social distancing and hygiene requirements of the countries where they are based.
When Covid-10 first broke out, Games Workshop took the decision to close all of its operations earlier than many retailers. As the retailer reopens it is seeing sales pick up faster than expected and is predicting that it will make a full-year profit.
At the time, trading for the nine months to the end of February was in line with expectations, and its performance was affected while its global operations were closed. But since reopening it now expects its sales revenue for the year to May 31 to come in at about £270m and its pre-tax profits to come in at at least £85m, including about £16m from licensing royalties, according to its trading update today. It has cash of £50m and has a £25m overdraft facility in place. Given all of this, it now has no plans to claim any more government subsidies and says it will repay amounts that have already been paid out, where it can. But it also says it’s too early to know what the long-term effect of Covid-19 will be.
As a non-essential retailer The Works closed all of its UK shops on March 23, in line with Government lockdown guidelines. Now it plans to open 465 shops in England, Northern Ireland and the Republic of Ireland next week, before reopening in Scotland and Wales as soon as it is able. Full social distancing and hygiene measures, from floor stickers to limiting in-store numbers, perspex screens and hand sanitiser, will be in place fo the reopening.
Since shops closed the retailer, ranked Top50 in RXUK Top500 research, has seen strong demand online, with ecommerce sales up by more than three times compared to the same time last year. It has expanded its online fulfilment capacity, within social distancing guidelines, in order to meet this demand and says it will continue to work closely with its fulfilment partner in order to boost levels again through peak trading over the coming Christmas period.
But while the retailer expects trading to improve once stores reopen and most furloughed staff return to work, it says, in a trading update today, that it is not yet possible to give meaningful guidance for the current financial year. The multichannel value books-to-crafts retailer has 534 shops in the UK and Ireland and access to a £25m revolving credit facility.