NOTES TO FINANCIAL STATEMENTS

1. Principal accounting policies
The financial statements have been prepared in accordance with applicable accounting standards in the United Kingdom.

A summary of the principal accounting policies, which have been applied consistently is set out below.

Basis of accounting
The financial statements are prepared in accordance with the historical cost convention.

Basis of consolidation
The consolidated financial statements include the Company and its subsidiary undertakings drawn up to 30 May 2004.

Goodwill
Goodwill arising on acquisition of subsidiaries, representing any excess of the fair value of the consideration given over the fair value of the identifiable net assets acquired, is capitalised and amortised on a straight line basis over its useful economic life. The goodwill arising on the acquisition of Sabertooth Games, Inc. is being amortised over six years. All other acquired goodwill is amortised over 20 years. Provision is made for any impairment.

Goodwill arising on acquisitions prior to 31 May 1998 was written off to reserves in accordance with the accounting standard then in force. As permitted by the current accounting standard, the goodwill previously written off to reserves has not been reinstated in the balance sheet. In the event of disposal or closure of a previously acquired business, the attributable amount of goodwill previously written off to reserves will be included in determining the profit or loss on disposal.

Development expenditure
Product development and design expenditure is written off as it is incurred. The development costs in respect of the Warhammer Online venture are also written off.

Tangible fixed assets
Tangible fixed assets are stated at cost, net of depreciation and any provision for impairment. The cost of tangible fixed assets is their purchase cost, together with any incidental costs of acquisition.

Depreciation is calculated so as to write off the cost of tangible fixed assets on a straight line basis over the expected useful economic lives of the assets concerned. The principal annual rates used for this purpose are:

	%
Freehold buildings	2
Plant and equipment	20-33
Motor vehicles	33
Fixtures and fittings	15-33
Moulding tools	25

Leasehold premises are amortised over the period of the lease. Freehold land is not depreciated.

Operating leases and hire purchase contracts
Costs in respect of operating leases and any benefits received as an incentive to sign a lease, are charged or credited on a straight line basis over the lease term. Finance leases which transfer to the Group substantially all the benefits and risks of ownership of an asset, are treated as if the asset had been purchased outright. The assets are included in fixed assets and the capital element of the finance lease commitment is shown as obligations under finance leases. The capital element of the payment is applied to reduce the outstanding obligations and the interest element is charged against profit in proportion to the reducing capital element outstanding.

Stocks
Stocks are valued at the lower of cost and net realisable value. In respect of finished goods, cost includes appropriate production overheads. Where necessary, provision is made for obsolete, slow moving and defective stocks.

Foreign currencies
Assets and liabilities expressed in foreign currencies are translated into sterling at rates of exchange ruling at the end of the financial year or at rates of exchange fixed using forward foreign currency contracts where they exist. The results of overseas subsidiary companies are translated at the average rate of exchange for the year.

Gains and losses arising on the translation of the net assets of overseas subsidiary companies are taken to reserves, net of exchange differences arising on related foreign currency borrowings.

All other foreign exchange differences are taken to the profit and loss account in the year in which they arise.

Investments
Shares and loans in subsidiary undertakings are stated at cost less provision for impairment. Own shares are stated at cost less amortisation. Where the Company’s shares have been acquired to fulfil future commitments under incentive plans, the cost of those shares is amortised over the performance period of the incentive plans.

Turnover
Turnover, which excludes value added tax and sales between group companies, represents the invoiced value of goods and services supplied.

Turnover on goods sold to customers on a sale or return basis, is recognised after making full provision for the level of expected returns, based on past experience. The level of returns is reviewed on a regular basis and the provision is amended accordingly. Turnover on a sale or return basis represents no more than 1% of consolidated turnover.

Royalty income is recognised by spreading the guarantees and advances receivable over the term of the licence agreement, and recognising all other income receivable by reference to the underlying licencee performance period.

Taxation
Current tax, including UK corporation tax and foreign tax, is provided at amounts expected to be paid/(recovered) using the tax rates and laws that have been enacted or substantially enacted by the balance sheet date.

Deferred taxation is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or events that result in an obligation to pay more tax in the future or a right to pay less tax in the future have occurred at the balance sheet date. Timing differences are differences between the Group’s taxable profits and its results as stated in the financial statements that arise from the inclusion of gains and losses in tax assessments in periods different from those in which they are recognised in the financial statements.

A net deferred tax asset is regarded as recoverable and therefore recognised only when, on the basis of all available evidence, it can be regarded as more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.

Deferred tax is measured at the average tax rates that are expected to apply in the periods in which the timing differences are expected to reverse, based on tax rates and laws that have been enacted or substantially enacted by the balance sheet date. Deferred tax is measured on a non-discounted basis.

Pension costs
The Group operates a defined contribution scheme and a group personal pension plan. Pension contributions are charged to the profit and loss account as they accrue.

Bonus and incentive plans
The costs of annual bonus schemes are charged to the profit and loss account as they accrue. For those incentive plans which are based upon performance criteria measured over a period in excess of one year, costs are charged to the profit and loss account based upon the directors’ estimate of the likely future outcome of those criteria. Where the criteria include the Company’s share price, costs are charged by reference to the evolution of the share price over the lifetime of the scheme, with the annual expense taking account of the year end price. These estimates are revised at each period end.

2. Geographical analysis

Turnover
By geographical area of sales operation

	2004 £000	2003 £000
Continental Europe	61,290	50,030
United Kingdom	48,241	39,353
The Americas	33,110	32,218
Asia Pacific	9,134	7,508
Turnover	151,775	129,109

By geographical area of destination

	2004 £000	2003 £000
Continental Europe	66,643	51,672
United Kingdom	42,143	37,160
The Americas	33,291	32,384
Asia Pacific	9,501	7,683
Other	197	210
Turnover	151,775	129,109

Operating profit

By geographical area of sales operation	2004 £000	Restated 2003 £000
Continental Europe	19,948	14,096
United Kingdom	11,370	11,590
The Americas	(829)	1,573
Asia Pacific	756	1,162
	31,245	28,421
Design and development costs	(3,549)	(3,725)
New business development costs	(3,085)	(2,531)
Central costs	(4,942)	(4,901)
Operating profit before royalties	19,669	17,264
Royalty income	186	197
Operating profit	19,855	17,461

New business development costs include £2.5 million (2003: £1.7 million) in respect of the Warhammer Online venture. The prior year allocation of operating profit by geographical area has been restated to better reflect the allocation of manufacturing costs between the UK and US based production activities.

Net assets

By geographical area of sales operation	2004 £000	Restated 2003 £000
Continental Europe	10,919	6,169
United Kingdom	8,252	2,769
The Americas	10,377	10,568
Asia Pacific	398	708
	29,946	20,214
Unallocated net assets/[liabilities]
- cash	8,570	11,728
- taxation	(813)	(1,764)
- central	(3,599)	(2,005)
Net assets	34,104	28,173

The prior year has been restated to allocate goodwill across the appropriate geographical area and to remove short-term intra group indebtedness from the territories, in line with cash.

3. Turnover, cost of sales, gross profit and net operating expense

	2004 £000	2003 £000
Turnover	151,775	129,109
Cost of sales	50,099	42,592
Gross profit	101,676	86,517
Selling and distribution costs	45,035	37,996
Administravite costs	36,972	31,257
Other operating income - royalty income	(186)	(197)
Net operating expenses	81,821	69,056
Operating profit	19,855	17,461

	2004 £000	2003 £000
Administrative costs include:
Design and development costs	3,549	3,725
New business development costs	3,085	2,531
Other administrative costs	30,338	25,001
Total administrative costs	36,972	31,257

4. Directors’ emoluments

	2004 £000	2003 £000
Aggregate emoluments and benefits	2,039	1,616
Pension contributions	51	45
	2,090	1,661

Further information relating to directors’ emoluments, shareholdings and share options are disclosed in theaudited section of the remuneration report.

5. Employee information

The average monthly number of persons (including executive directors) employed by the Group
during the year was:

	2004 Numbers	2003 Numbers
Production	349	372
Selling and distribution:
Full time	1,517	1,319
Key time*	825	779
Administration	486	402
	3,177	2,872

* Key time employees are employed in our Hobby stores and typically work a 20 hour week.

Staff costs (for the above persons)

	2004 £000	2003 £000
Wages and salaries	47,540	41,378
Social security costs	5,793	4,437
Other pension costs	1,117	863
	54,450	46,678

6. Interest payable and similar charges

	2004 £000	2003 £000
On bank loans and overdrafts	402	270
On finance leases and hire purchase contracts	9	4
Other	16	-
	427	274

7. Profit on ordinary activities before taxation

	2004 £000	2003 £000
Profit on ordinary activities before taxation is stated after charging:
Amortisation
goodwill	366	457
own shares	-	121
Depreciation
tangible owned fixed assets	5,958	5,689
tangible fixed assets under finance leases and hire purchased contracts	122	20
Operating leases
property	8,935	7,388
plant and equipment	384	242
other	121	115
Auditors' remuneration for audit services	226	198
Auditors' remuneration for non-audit services
taxation services - compliance	33	23
taxation services - advisory	178	109
further assurance services	21	60

8. Taxation on profit on ordinary activities

	2004 £000	2003 £000
Current taxation
UK corporation tax	4,716	6,341
Over provision in respect of prior years	(306)	(1,137)
	4,410	5,204
Overseas taxation	2,193	1,844
Total current taxation	6,603	7,048
Origination and reversal of timing differences	642	(578)
Taxation on profit on ordinary activities	7,245	6,470

	2004 £000	2003 £000
Profit on ordinary activities before taxation	19,573	17,452
Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 30%	5,872	5,236
Effects of:
Expenses not deductible for tax purposes	(211)	402
Movement in deferred tax not recognised	1,182	1,515
Origination and reversal of timing differences	(222)	578
Losses attributable to minority interests	218	168
Higher tax rates on overseas earnings	208	167
Adjustments to tax charge in respect of previous years	(444)	(1,081)
Current tax charge for the year	6,603	7,048

9. Profit for the financial year

As permitted by section 230 of the Companies Act 1985, the Company’s profit and loss account has not been included in these financial statements. Of the profit for the financial year, £11.4 million (2003: £7.4 million) is attributable to the Company, after including dividends from subsidiary companies of £18.3 million (2003: £13.0 million).

10. Dividends

	2004 £000	2003 £000
Interim paid of 4,725 pence per share [2003: 4.5 pence]	1,444	1,335
Final proposed of 14.025 pence per share [2003: 12.500 pence]	4,290	3,759
Under/[over] provision in respect of prior years	15	[8]
	5,749	5,086

11. Earnings per ordinary share

The calculation of basic earnings per ordinary share has been based on profit for the year of £12.3 million (2003: £11.0 million) and the weighted average number of shares in issue throughout the year.

The calculation of diluted earnings per ordinary share has been based on profit for the year and the weighted average number of shares in issue throughout the year, adjusted for the dilution effect of share options outstanding at the year end.

	2004	2003
Weighted average number of shares:
For basic earnings per ordinary share	30,223,087	29,689,168
Dilution effect of share options understanding	495,036	600,302
For diluted earnings per ordinary share	30,718,123	30,289,470

12. Goodwill

	£000
Group
Cost
At 2 June 2003	4,217
Exchange adjustments	(452)
At 30 May 2004	3,765
Amortisation
At 2 June 2003	1,027
Charge for the year	366
Exchange adjustments	(91)
At 30 May 2004	1,302
Net book value at 30 May 2004	2,463
Net book value at 1 June 2003	3,190
The Company had no goodwill at either year end.

13. Tangible fixed assets

	Freehold land and buildings £000	Long leasehold premises £000	Short leasehold premises £000	Plant & equipment & vehicles £000	Fixtures and fittings £000	Moulding tools £000	Total £000
Group
Cost
At 2 June 2003	639	5,876	597	12,659	14,219	7,453	41,443
Exchange adjustments	-	-	(44)	(453)	(790)	-	(1,287)
Additions	5,124	-	112	4,396	3,834	1,290	14,756
Disposals	-	-	-	(217)	(250)	-	(467)
Reclassifications	5,876	(5,876)	(50)	1	49	-	-
At 30 May 2004	11,639	-	615	16,386	17,062	8,743	54,445
Depreciation
At 2 June 2003	87	1,023	335	7,330	9,334	5,711	23,820
Exchange adjustments	-	-	(25)	(251)	(425)	-	(701)
Charge for the year	19	161	73	2,745	2,131	951	6,080
Eliminated in respect of disposals	-	-	-	(170)	(211)	-	(381)
Reclassifications	1,184	(1,184)	(25)	(16)	41	-	-
At 30 May 2004	1,290	-	358	9,638	10,870	6,662	28,818
Net book value at 30 May 2004	10,349	-	257	6,748	6,192	2,081	25,627
Net book value at 1 June 2003	552	4,853	262	5,329	4,885	1,742	17,623

The net book value of tangible fixed assets includes an amount of £367,000 (2003: £nil) in respect of assets held under finance leases. The depreciation charged on these assets was £122,000 (2003: £20,000). Freehold land amounting to £3,841,000 (2003: £341,000) has not been depreciated.

During the year the freehold interest of the core Nottingham site was acquired. Accordingly the related fixed assets have been reclassified from long leasehold premises to freehold land and buildings.

Assets in the course of construction, and not depreciated, amount to £2,588,000 (2003: £nil).

The Company held no tangible fixed assets at either year end.

14. Fixed asset investments

	Group		Company
Cost	2004 £000	2003 £000	2004 £000	2003 £000
Subsidiary undertakings - equity	-	-	30,281	27,867
Own shares	-	-	-	-
	-	-	30,281	27,867

The increase in equity investments of £2.4 million relates to the recapitalisation of Games Workshop America, Inc.

Interests in group undertakings
The directors consider that to give full particulars of all subsidiary undertakings would lead to a statement of excessive length. The following information relates to those subsidiary undertakings whose results or financial position, in the opinion of the directors, principally affect the Group.

Name of undertaking	Country of incorporation or registration	Proportion of nominal value of issued shares held by:			Principal business activity
		Description of shares held	Company	Subsidiary Company
Games Workshop Limited	England and Wales	£1 ordinary	100%		Manufacturer, distributor and retailer of games and miniatures
Games Workshop America, Inc	United States of America	$1 common stock $100,000 preferred stock		100%	Distributor and retailer of games and miniatures
Games Workshop Retail, Inc	United States of America	$1 common stock	100%		Distributor and retailer of games and miniatures
Games Workshop US Manufacturing LLC	United States of America	Owners capital		100%	Manufacturer of games and miniatures
Games Workshop (Queen Street) Limited	Canada	Can $1		100%	Distributor and retailer of games and miniatures
EURL Games Workshop	France	Euro 1		100%	Distributor and retailer of games and miniatures
Games Workshop SL	Spain	Euro 1		100%	Distributor and retailer of games and miniatures
Games Workshop Oz Pty Limited	Australia	Aus $1		100%	Distributor and retailer of games and miniatures
Games Workshop Deutschland GmbH	Germany	Euro 1		100%	Distributor and retailer of games and miniatures
Games Workshop Limited	New Zealand	NZ $1		100%	Distributor and retailer of games and miniatures
Games Workshop Italia SRL	Italy	Euro 1		100%	Distributor and retailer of games and miniatures
Sabertooth Games, Inc	United States of America	$1 common stock		100%	Distributor of collectible card games
Games Workshop Tooling Limited	England and Wales	£1 ordinary	100%		Manufacturer of tools for injection moulding
Games Workshop International Limited	England and Wales	£1 ordinary	100%		Holding company for overseas subsidiary companies
Warhammer Online Limited	England and Wales	£1 ordinary		71.25%	Developer of online games

All the above companies operate principally in their country of incorporation or registration.

Own shares

	Cost £000	Amortisation £000	Total £000
Group and Company
At 2 June 2003	1,011	(1,011)	-
Amortisation	-	-	-
At 30 May 2004	1,011	(1,011)	-

The Company operates a long-term incentive plan for the senior management of the Group. An Employee Share Ownership Plan (ESOP), in the form of a discretionary trust, has been established to facilitate the operation of the incentive scheme. Details of the scheme are given in the remuneration report above. The number and market value of the ordinary shares held by the ESOP at 30 May 2004 was 260,492 (2003: 260,492) and £1,691,000 (2003: £1,424,000) respectively. Dividends have been waived on these shares.

15. Stocks

	2004 £000	2003 £000
Group
Raw materials and consumables	1,959	1,636
Finished goods and goods for resale	10,143	10,860
	12,102	12,496

There is no material difference between the balance sheet value of stocks and their replacement cost.

The Company held no stocks at either year end.

16. Debtors

Amounts falling due within one year	Group		Company
	2004 £000	2003 £000	2004 £000	2003 £000
Trade debtors	8,598	7,499	-	-
Amounts owed by group undertakings	-	-	9,751	8,018
Other debtors	858	532	42	51
Prepayments and accrued income	2,041	2,215	11	61
Deferred taxation	824	1,572	86	720
	12,321	11,818	9,890	8,850
Amounts falling due after more than one year
Amounts owed by group undertakings	-	-	-	252
Other debtors	267	328	-	-
Deferred taxation	1,024	1,066	12	7
	1,291	1,394	12	259
Total	13,612	13,212	9,902	9,109

Deferred taxation

Deferred tax can be analysed over the following timing differences:

Recognised	Group		Company
	2004 £000	2003 £000	2004 £000	2003 £000
Accelerated depreciation	972	1,066	12	7
Short-term timing differences	824	1,572	86	720
Tax losses	52	-	-	-
	1,848	2,638	98	727

Unrecognised	Group		Company
	2004 £000	2003 £000	2004 £000	2003 £000
Tax losses	3,475	2,107	-	-
Short-term timing differences	360	-	-	-
	3,835	2,107	-	-

No deferred tax asset has been recognised on unrelieved tax losses in certain countries due to the uncertainty as at the balance sheet date as to their recovery over the next 12 months.

17. Creditors: amounts falling due within one year

	Group		Company
	2004 £000	2003 £000	2004 £000	2003 £000
Obligations under finance leases	161	-	-	-
Bank overdraft	-	-	-	3,406
Trade creditors	5,663	7,353	3	785
Amounts owed to group undertakings	-	-	4,135	5,263
Corporation Tax	2,661	4,402	-	-
Other taxation and social security	2,373	1,984	93	74
Other creditors	1,451	1,353	20	11
Accruals and deferred income	9,959	9,484	1,292	1,577
Proposed dividend	4,290	3,759	4,290	3,759
	26,558	28,335	9,833	14,875

18. Creditors: amounts falling due after more than one year

	Group		Company
	2004 £000	2003 £000	2004 £000	2003 £000
Obligations under finance leases	204	-	-	-
Other creditors	93	-	-	-
Accruals and deferred income	491	16	-	-
	788	16	-	-
Analysis of borrowings
Secured
Finance leases	365	-	-	-
Unsecured
Uncommitted floating rate overdraft facility	-	-	-	3,406
	365	-	-	3,406
Repayable:
Within 1 year of less or on demand	161	-	-	3,406
Between 1 and 2 years	203	-	-	-
Between 2 and 5 years	1	-	-	-
	365	-	-	3,406

19. Financial instruments

The Group’s treasury policy is explained in the financial review statement above.

Short-term debtors and creditors
Short-term debtors and creditors have been excluded from all of the following disclosures, other than the currency risk disclosures.

Interest rate risk and maturity profile of financial liabilities and borrowing facilities
The Group has sterling drawings of £nil (2003: £nil) against a revolving credit facility of £10 million at 30 May 2004. This facility, which is available until 30 September 2007, is unsecured. The covenants are based upon interest cover and gearing and have been complied with during the year. Interest is accrued monthly at a floating rate.

The Group also has sterling uncommitted floating rate overdraft facilities of £5 million (2003: £5 million) available at 30 May 2004.

Financial liabilities include finance lease obligations that accrue a fixed rate of interest (sterling liability at 2%: £313,000, US dollar liability at 4%: £52,000).

The maturity profile of the Group’s financial liabilities is disclosed in note 18 above.

Interest rate risk profile of financial assets
The Group’s cash at bank and in hand balance can be analysed as follows:

	2004 £000	2003 £000
Sterling	(4,211)	1,034
US dollar	1,920	1,705
EU currencies (other than sterling)	8,895	7,034
Other currencies	1,966	1,955
	8,570	11,728

The above cash balances earn interest at short-term floating rates available locally.

Currency exposure
The following table shows the extent to which group companies have external net monetary assets and liabilities in currencies other than their operating currency.

As at 30 May 2004 these external monetary assets and liabilities were as follows:

Functional currency of group operation	Sterling £000	US dollar £000	EU currencies (other than sterling) £000	Other currencies £000	Total £000
Sterling	-	427	5,318	1,835	7,580
US dollar	(17)	-	241	-	224
EU currencies (other than sterling)	130	3	-	-	133
	113	430	5,559	1,835	7,937

At 1 June 2003 these external monetary assets and liabilities were as follows:

Functional currency of group operation	Sterling £000	US dollar £000	EU currencies (other than sterling) £000	Other currencies £000	Total £000
Sterling	-	970	3,923	1,134	6,027
EU currencies (other than sterling)	(219)	8	-	-	(211)
Other currencies	-	-	-	146	146
	(219)	978	3,923	1,280	5,962

Fair values of financial assets and liabilities
There are no differences between the book values and the fair values of financial assets and liabilities.

Gains and losses on hedges
As explained in the financial review the principal financial exposure to the Group is movements in exchange rates. The Group’s transactional exposure on trading cash flows settled in non-sterling currencies is managed through the use of forward currency contracts covering a prospective period of 12 months rolling.

Under the Group’s accounting policy, foreign currency assets which are hedged using forward foreign currency contracts are translated into sterling at the forward rate inherent in the contracts. Consequently, the carrying value of the relevant asset effectively includes the gain or loss on the hedging instrument. Such gains and losses are treated as recognised for the purpose of the table below.

The following table shows the extent to which the Group has unrecognised net gains and losses in respect of forward foreign currency contracts used as hedges:

	2004 £000	2003 £000
Unrecognised losses at 2 June 2003	(468)	(135)
Losses arising in previous years that were recognised in 2003/4	468	135
Losses/(gains) arising before 2 June 2003 that were not recognised	-	-
Gains arising in 2003/4 that were not recognised in 2003/4	1,096	-
Unrecognised gains on hedges at 30 May 2004	1,096	-
Unrecognised losses on hedges at 1 June 2003	-	(468)
Of which gains expected to be recognised in 2004/5	1,096	-
Of which losses expected to be recognised in 2003/4	-	(468)

Gains recognised in the current year in respect of foreign currency contracts were £1,183,000 (2003: losses £893,000).

Financial instruments held for trading purposes
The Group does not trade in financial instruments.

20. Provisions for liabilities and charges

	Bonus and incentive £000	Property £000	Total £000
Group
At 2 June 2003	1,232	493	1,725
Charged to the profit and loss account	466	39	505
Paid	[1,306]	-	[1,306]
At 30 May 2004	392	532	924

	Bonus and incentive £000
Company
At 2 June 2003	1,232
Charged to the profit and loss account	466
Paid	[1,306]
At 30 May 2004	392

The bonus and incentive provision, at 30 May 2004, relates to the long-term incentive plan which will be utilised from May 2005 being the start of the exercise period for the last awards made from the plan.

The property provision relates to onerous lease commitments and will diminish over the lives of the underlying leases.

21. Called up share capital

	2004 £000	2003 £000
Authorised
42,000,000 ordinary shares of 5p each	2,100	2,100
Allotted, called up and fully paid
30,847,240 [2003: 30,069,696] ordinary shares of 5p each	1,542	1,503

During the year 264,984 ordinary shares of 5p were issued for £1,834,732 under the Games Workshop Group PLC 1995 Sharesave Scheme, 72,984 ordinary shares were issued for £83,087 under the Games Workshop Group PLC International Sharesave Scheme, 337,279 ordinary shares were issued for 1,804,416 under the Games Workshop Group PLC 1994 Executive Share Option Scheme and 102,297 ordinary shares were issued for £300,179 under the Games Workshop Group PLC 1994 Worldwide Executive Share Option Scheme.

22. Options in shares of Games Workshop Group PLC

Options over ordinary shares outstanding at the date of this report are as follows

Date granted	No. of shares	Exercise price	Exercise dates
28 September 1994	9,462	115p	Sep 1997 to Sep 2004
17 September 1996	5,000	463p	Sep 1997 to Sep 2004
17 September 1997	57,956	687.5p	Sep 2000 to Sep 2004
17 September 1997	22,360	687.5p	Sep 2002 to Sep 2004
24 August 1999	6,522	460p	Aug 2002 to Aug 2006
24 August 1999	13,044	460p	Aug 2002 to Aug 2009
4 October 1999	28,866	394p	Nov 2004 to Apr 2005
21 August 2000	14,184	141p	Aug 2003 to Aug 2007
21 August 2000	35,460	141p	Aug 2003 to Aug 2010
31 July 2001	7,946	392.5p	July 2004 to July 2008
3 October 2001	104,986	338p	Nov 2004 to Apr 2005
26 July 2002	12,869	-	June 2004 to July 2007
3 October 2002	105,833	335p	Nov 2005 to Apr 2006
25 July 2003	284,690	-	June 2005 to July 2008
30 September 2003	98,905	580p	Nov 2006 to Apr 2007
	808,083

23. Reserves

	Capital redemption reserve £000	Profit and loss account £000	Share premium £000
Group
At 2 June 2003	101	25,301	1,267
Exchange adjustments	-	(2,012)	-
Profit retained for the financial year	-	6,580	-
Issue of ordinary share capital	-	(2,659)	3,984
At 30 May 2004	101	27,210	5,251
Company
At 2 June 2003	101	9,970	9,295
Profit retained for the financial year	-	5,617	-
Issue of ordinary share capital	-	-	3,984
At 30 May 2004	101	15,587	13,279

The cumulative amount of goodwill written off against the Group’s profit and loss account reserve is £1,159,000 (2003: £1,159,000).

24. Equity minority interests

	£000
At 2 June 2003	1
Net loss on ordinary activities after taxation	(827)
Provision against minority loss	826
At 30 May 2004	-

25. Reconciliation of movements in equity shareholders’ funds

	2004 £000	2003 £000
Group
Profit for the financial year	12,329	10,982
Dividends	(5,749)	(5,086)
	6,580	5,896
Issue of new share capital	1,364	399
Own shares purchased/cancelled	-	(443)
Other recognised gains and losses	(2,012)	95
Opening equity shareholders' funds	28,172	22,225
Closing equity shareholders' funds	34,104	28,172

26. Capital commitments

The Group had capital commitments of £827,000 (2003: £79,000). The Company had no capital commitments at either year end.

27. Financial commitments

The Group had annual commitments under non-cancellable operating leases as follows

	Land and buildings 2004 £000	Other 2004 £000	Land and buildings 2003 £000	Other 2003 £000
Expiring within 1 year	1,119	425	1,144	271
Expiring between 2 and 5 years inclusive	4,722	283	4,727	286
Expiring in over 5 years	2,420	-	2,250	-
	8,261	708	8,121	557

The Company had no financial commitments at either year end.

28. Contingent liabilities

The Group and Company had no contingent liabilities at either year end.

The Company provides indemnities to third parties in respect of contracts including their use of its intellectual property, under commercial terms in the normal course of business.

29. Post balance sheet event

Warhammer Online
A decision to terminate the venture was taken on 21 June 2004. The Group’s accounting policy is to write off 100% of the development costs in respect of this activity. The costs of termination will be accounted for in the results for the year ending 29 May 2005.

<< Notes to the cash flow statement

Five year summary and financial calendar >>

• Latest Results
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  directors and advisers
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• Profit and loss account
• Balance sheets
• Cash flow statement
• Notes to the
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• Notes to the
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• Five year summary and
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• Notice of meeting
• Appendix 1 - Chairman's
  preamble from 2002 annual
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• Appendix 2- Chairman's
  preamble from 2003 annual
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• Corporate Brochure (pdf)

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