TheWorks.co.uk plc (WRKS) AI Stock Analysis

• Market Cap: £36.56M
• Dividend Yield: N/A
• Average Volume (3M): 279.15K
• Price to Earnings (P/E): 4.5
• Beta (1Y): 0.11
• Revenue Growth: 0.16%
• EPS Growth: 287.23%
• Country: UK
• Employees: 4,000
• Sector: Consumer Cyclical
• Sector Strength: 66
• Industry: Specialty Retail
• EPS (TTM): 0.23
• Shares Outstanding: 62,500,000
• 10 Day Avg. Volume: 332,400
• 30 Day Avg. Volume: 279,151
• PEG Ratio: 0.04
• Price to Book (P/B): 10.26
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 1.83
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £40.00
• Price Target Upside: -31.62% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 69 Neutral
• Price Target: 40.00p ▼(-31.62%Downside)

The overall stock score reflects strong technical indicators and positive corporate events that signal confidence in the company's future prospects. Financial performance is moderate with some risks due to high leverage. The undervalued P/E ratio further supports potential upside, while the lack of earnings call details limits a comprehensive assessment.

TheWorks.co.uk plc Business Overview & Revenue Model

Company Description

TheWorks.co.uk plc operates as a retailer of gifts, arts, crafts, toys, books, and stationery products. The company sells its products through a network of stores, as well as through its online platform. As of May 2, 2021, it operated 527 stores in the United Kingdom and Ireland. The company was founded in 1981 and is based in Birmingham, the United Kingdom.

How the Company Makes Money

TheWorks.co.uk plc generates revenue primarily through the sale of its diverse range of products both in-store and online. The company leverages its wide geographical presence with physical retail outlets located in high-traffic areas, which drives significant footfall and sales volume. Additionally, its online platform extends its reach, catering to customers who prefer shopping from home. The Works benefits from economies of scale by sourcing products in bulk, allowing it to offer competitive pricing. Seasonal promotions and partnerships with popular brands enhance its product appeal, while its loyalty programs and marketing strategies aim to increase customer retention and repeat purchases. The combination of diversified product offerings and strategic pricing underpins its revenue model.

TheWorks.co.uk plc Financial Statement Overview

Summary

The company shows moderate financial health with revenue growth and improved profitability margins. However, high leverage and a weak equity base pose risks. Robust cash flow generation is a positive, but the decline in free cash flow is concerning.

Income Statement

The company's revenue has shown a consistent growth trajectory with a 0.89% increase from 2023 to 2024. Gross profit margin improved to 18.34% in 2024, indicating better cost management. Net profit margin also increased to 2.26%, though still relatively low, suggesting room for profitability improvement. EBIT and EBITDA margins rose to 4.04% and 12.02% respectively, reflecting enhanced operational efficiency.

Balance Sheet

The debt-to-equity ratio is high at 7.71, indicating significant leverage, which poses a risk if not managed properly. The return on equity improved to 63.23%, driven largely by a low equity base, which may not be sustainable. The equity ratio is weak at 8.49%, suggesting high reliance on debt financing and potential vulnerability to financial distress.

Cash Flow

Free cash flow decreased by 13.29% from the previous year, showing some strain on cash generation. Operating cash flow to net income ratio is strong at 3.94, indicating efficient cash conversion from operations. Free cash flow to net income ratio stands at 2.80, demonstrating solid cash profitability.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	282.58M	280.10M	264.63M	180.68M	225.04M
Gross Profit	51.82M	43.90M	55.03M	19.95M	31.39M
EBITDA	33.96M	38.21M	33.94M	32.13M	13.54M
Net Income	6.38M	5.27M	13.96M	-2.30M	-17.70M
Balance Sheet
Total Assets	118.81M	137.26M	149.33M	180.44M	186.31M
Cash, Cash Equivalents and Short-Term Investments	1.62M	10.20M	16.28M	8.31M	6.55M
Total Debt	77.76M	98.22M	111.14M	143.01M	145.73M
Total Liabilities	108.73M	135.60M	148.95M	171.62M	172.90M
Stockholders Equity	10.09M	1.65M	378.00K	8.83M	13.41M
Cash Flow
Free Cash Flow	17.87M	20.61M	45.33M	27.73M	17.79M
Operating Cash Flow	25.16M	29.22M	49.16M	30.13M	26.46M
Investing Cash Flow	-5.83M	-6.45M	-2.94M	-2.38M	-8.66M
Financing Cash Flow	-27.21M	-29.42M	-38.13M	-22.59M	-18.87M

TheWorks.co.uk plc Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 58.50
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:WRKS, the sentiment is Positive. The current price of 58.5 is below the 20-day moving average (MA) of 58.69, above the 50-day MA of 53.65, and above the 200-day MA of 29.66, indicating a neutral trend. The MACD of 1.52 indicates Positive momentum. The RSI at 53.15 is Neutral, neither overbought nor oversold. The STOCH value of 49.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:WRKS.

TheWorks.co.uk plc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WRKS	69 Neutral	£36.56M	4.53	63.08%	―	0.16%	287.23%
MRK	66 Neutral	£64.02M	―	-11.56%	1.59%	2.55%	-445.00%
ANG	65 Neutral	£33.28M	24.73	3.66%	―	11.86%	16.46%
G4M	62 Neutral	£51.81M	64.99	2.14%	―	-3.30%	―
PROC	62 Neutral	£49.90M	50.00	11.06%	―	5.35%	―
SOS	58 Neutral	£14.89M	72.73	-3.01%	―	-7.70%	-45.00%
Sector *	57 Neutral	HK$25.10B	4.09	-2.03%	5.85%	-0.24%	-68.05%

TheWorks.co.uk plc Corporate Events

TheWorks.co.uk plc Reports Strong FY25 Performance and Optimistic FY26 Outlook

TheWorks.co.uk plc reported significant financial and strategic progress for the fiscal year 2025, despite a challenging consumer environment. The company achieved a 0.8% increase in like-for-like sales, driven by a 2.3% rise in store sales, although online sales declined by 12.1% due to fulfillment issues. Total revenue decreased by 2% to £277 million, partly due to a shorter trading period compared to the previous year. The company improved its profit margins and reduced costs, resulting in an expected EBITDA of £9.5 million, surpassing market expectations. The Works is transitioning to a new third-party provider to enhance online fulfillment, which is expected to yield cost savings in the future. The company is optimistic about continued profit growth in fiscal year 2026, supported by its new strategy ‘Elevating The Works’ and a strong cash position.

TheWorks.co.uk Chair Increases Shareholding, Signaling Confidence

TheWorks.co.uk plc announced that its Non-Executive Chair, Steve Bellamy, has acquired 55,000 ordinary shares in the company, increasing his total shareholding to 710,000 shares, which represents 1.14% of the company’s issued share capital. This purchase may signal confidence in the company’s future prospects and could have implications for investor sentiment, potentially affecting the company’s market positioning and stakeholder interests.

TheWorks.co.uk Chair Increases Stake with Share Purchase

TheWorks.co.uk plc announced that its Non-Executive Chair, Steve Bellamy, has acquired 30,000 ordinary shares in the company, increasing his total shareholding to 655,000 shares, which represents 1.05% of the company’s issued share capital. This transaction may indicate confidence in the company’s future performance and could positively influence investor sentiment, potentially impacting the company’s market positioning and stakeholder interests.

TheWorks.co.uk Director Increases Stake with Share Purchase

TheWorks.co.uk plc announced that Simon Hathway, a Non-Executive Director, has purchased 100,000 ordinary shares in the company, representing 0.16% of its issued share capital. This transaction, conducted on the London Stock Exchange, may signal confidence in the company’s future prospects and could impact its market perception positively.

TheWorks.co.uk Enhances Employee Incentive Scheme with Share Purchase

TheWorks.co.uk plc has announced that its Employee Benefit Trust (EBT) has purchased 410,000 ordinary shares to support its executive and employee share plans. This acquisition, funded by a company loan, increases the EBT’s holdings to 4.29% of the company’s issued share capital, reflecting a strategic move to incentivize and retain key personnel, potentially strengthening the company’s operational stability and stakeholder confidence.