Workshop's sales slump Rings final bell on boost

The Nottingham-based firm, which also makes the Warhammer battle game, said UK sales fell to 21 million during the six months to 28 November, from 22.3m a year ago.

It blamed the "bubble effect" created by the Rings films since 2001 as enthusiasts flocked to Games Workshop stores, one of which is located on Edinburgh’s Royal Mile, to buy a tabletop version of the trilogy.

Benefits from the flurry of publicity around the launch of a partworks of the JRR Tolkien novels a couple of years ago had also passed.

Investors were urged to "take heart" as sales of its flagship Warhammer games were both higher than a year ago and chairman and chief executive Tom Kirby said the firm was "in better shape now to benefit from our future growth than we have been for years".

Group turnover was ahead at constant exchange rates by 1m at the half-year stage, although the reported figure dropped to 71m from 72m a year ago. Profits advanced to 7.7m from 7.4m last year.

The group achieves about 70 per cent of its sales outside the UK and has direct sales operations in the UK, the United States, Canada, France, Germany, Spain and Australia. It also serves Italy and other parts of northern Europe from Nottingham.

The firm retains control over every aspect of design, manufacture, distribution and retail of its models and rulebooks and sells its products through its own chain of more than 350 outlets and 4000 independent shops worldwide.

In the US, Games Workshop said its strategy of focusing on its stores in key cities rather than small independent retailers was bearing fruit.

Nick Bubb, an analyst with brokerage firm Evolution Securities, said he was "still positive on the group".