Games Workshop sales hit by staff cuts

Fantasy war games retailer Games Workshop yesterday said sales went into retreat after it cut back on staff in its hobby centres to reduce overheads.

The company, which makes collectable figurines for Warhammer and Lord of the Rings battle games, said the staffing changes led to shortfalls in its Northern Europe division, which includes the UK, and North America.

Mark Wells, chief executive at Games Workshop, said the emphasis was now on "customer service training" to deliver like-for-like growth in the months ahead.

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The company, which has more than 300 hobby centres worldwide and sells products through nearly 4,000 independent toy shops, said a 4 per cent decline in group sales to 60m in the six months to November 28 led to a 15 per cent drop in pre-tax profits for the period to 6.7m.

The Nottingham-based company recently said profits for the full year were likely to be below market expectations after a dismal end to 2010.

The chain, established in 1975 by gaming enthusiasts from London, has some 380 stores including in the UK, US and Australia.

As well as acting as salespersons, staff at the hobby centres oversee games in store and advise customers on how to maintain their collection. Mr Wells said the niche company was not affected by macro-economic factors, and added: "The board remains confident in the future growth and profitability of the group."

Jo Reedman, analyst at Singer Capital, said full-year profits are expected to be 12m, down from 16.1m in the previous financial year.