Hornby Warns Investors of £6 Million Loss
Hornby’s share price has fallen 60% after the toy maker released a profits warning announcing an expected loss of up to £6 million.
The company blamed a poor response to promotions in January from UK retailers and disappointing sales outside the UK during December and January. Like-Of-Like sales were 5% in the UK but behind the board’s previous expectations.UK sales were 17% up like-for-like during November and December.
Richard James, Chief Executive of Hornby, stated “This has been a real year of change at Hornby. Undoubtedly this is a disappointing result, but we have a strong portfolio of brands that we are determined to see flourish.
“The feedback from customers at the recent International Toy Fairs was encouraging and we are facing the future where, with the right platform, we can build value for our shareholders and drive the Group’s recovery.”
Hornby is not only a manufacturer of model trains and railways bearing its name but also owns a number of famous British heritage brands, including Scalextric, Corgi, Airfix and Humbrol. The company also has selected merchandise based on themes, such as James Bond, Thomas the Tank Engine, Thunderbirds and real haulage firm Eddie Stobart.
Not only has sales been below par, the company will write-off £1.0 million of stock in this financial year.
Three months ago Hornby issued a profits warning predicting a £2 million loss.
Near the close of trade the share price of Hornby plc (HRN.L) [CHECK] was 31.75 pence, 60.80% down on the previous day’s closing price of 81 pence.