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HALF-YEARLY REPORT

Games Workshop Group PLC ("Games Workshop" or the "Group") announces its half-yearly results for the six months to 30 November 2008.

Highlights: * Revenue at £61.2m (2007: £53.9m)
* Gross margin - pre-exceptional at 71.4% (2007: 70.1%)
* Operating profit - pre-exceptional and pre-royalties receivable at £3.3m

(2007: £0.5m) * Operating profit - pre-exceptional at £3.8m (2007: £1.2m) * Operating profit at £3.8m (2007: £0.6m) * Pre-tax profit/(loss) at £3.1m (2007: £(0.1)m)
* Earnings/(loss) per share of 4.9p (2007: (0.4)p)
Mark Wells, Chief Executive of Games Workshop, said:

"The work needed to establish growth in all channels in all territories goes on with some significant progress being made in this half-year where, with the exception of Continental Europe, we have been able to deliver local currency sales growth in all territories."


6 mths to 11/2008 (6 mths to 11/2007)

Revenue £61.2m (£53.9m)
Operating profit - pre-exceptional and pre-royalties receivable £3.3m (£0.5m)
Royalties receivable £0.5m (£0.7m)
Operating profit - pre-exceptional £3.8m (£1.2m)
Exceptional items - cost reduction programme £nil £(-0.6)m
Operating profit £3.8m (£0.6m)
Pre-tax profit/(loss) £3.1m £(-0.1)m
Basic earnings/(loss) per share 4.9p (-0.4)p

INTERIM MANAGEMENT REPORT

Results

The work needed to establish growth in all channels in all territories goes on with some significant progress being made in this half-year where, with the exception of Continental Europe, we have been able to deliver local currency sales growth in all territories.

As is usual, our three routes to market - independent retailers, direct via telephones and our web store, and our own Hobby centres - have had mixed fortunes. Those people looking for evidence about the health of the Hobby we service will take great comfort from the UK achieving sales growth in all three channels and Forge World's extremely strong showing (29% sales growth).

In a very difficult period for input costs - in particular with the price of commodities such as tin and our utility costs - it is pleasing to report that we have increased our gross margin from 70.1% in the last half-year report to 71.4% in this one. This speaks volumes both about the discipline and attention to detail shown by our supply side staff and the swift action taken in sales businesses to increase metal retail prices.

Following last year's restructuring, overheads remain under control. We have opened 14 Hobby centres during the period and closed eight, taking our total to 340.

Compared to November 2007, sterling has weakened by 12.7% against the US dollar and by 13.6% against the euro. We have shown below our sales progression in local currency terms to permit a more meaningful comparison.

Our net borrowings as at 30 November 2008 stood at £11.0 million, a reduction of £4.2 million from the balance at November 2007. Our banking facilities were renewed in July 2008, as set out in the 2008 annual report (page 11). We have complied with the conditions of all banking covenants during the period.

Prospects

As a niche business we do not usually suffer or benefit from, macro-economic factors. Whilst we are pleased with our half-year results, it would be foolish not to sound a note of caution for the short term as we sell through many independent retailers all over the world most of whom are far less well protected than we are.

The principal risks and uncertainties for the balance of the year remain as described in our 2008 annual report (page 6). These risks lie in the ability of our sales businesses to establish and maintain sales growth and in our manufacturing operation to control input costs. The Hobby is healthy and our challenge is to stay focused on what needs to be done to service it efficiently and cost effectively.

Games Workshop's core fundamentals remain strong. We continue to grow our sales, our gross margins are improving, our costs are under control, our return on capital is increasing and our cash flow is good. The board remains confident in the future growth and profitability of the Group