Saturday, 14 November 2009

NEWS: Sales drop for Hornby

Hornby hopes Jenson Button will put Scalextric back on track

From UTV Business: 'Model Maker looking to Formula One world champion to lift sales after sharp fall in half-year profits. Hornby is hoping that Jenson Button will get its sales figures motoring this Christmas after suffering a sharp fall in profits. The company said today that Button's victory in the Formula One world championship should provide "a significant boost" to the sales of its Scalextric and Micro Scalextric toys.

"Hornby holds the exclusive worldwide licence to produce slot racing products featuring the Brawn team and Jenson Button. The first products carrying this licence will be available in time for Christmas 2009," it told the City.

Two years ago, Hornby benefited from the popularity of Lewis Hamilton, the 2008 world champion. Scalextric sets modelled on the young driver helped to push sales up by 30% overall.

Hornby, whose products also include Corgi model cars and Airfix model planes, made a pre-tax profit of £700,000 in the six months to 30 September, down from £1.8m the previous year. In the UK, Hornby grew its turnover by 1.5%, despite a fall in sales of model railway and Scalextric products. It blamed this on retailers who resisted ordering new supplies ahead of the Christmas period.

"Sales of Scalextric sets priced at the top and lower ends of our range remained robust, while demand for sets priced in the middle of the range was more muted," Hornby reported. "We anticipated this trend and we have introduced several new Micro Scalextric sets that have proved popular. In particular the Micro Scalextric Need for Speed and Disney's Cars sets are selling very well."

Hornby has experienced supply chain problems involving its Chinese supplier, Sanda Kan. It was taken over last year, and Hornby reported today that the situation is finally improving, with shipment volumes now increasing each week. "With the effects of our supply chain issues now receding, the board remains confident in the prospects for the year," said Neil Johnson, Hornby's chairman.

The company has also suffered from the weakness of sterling, which has eroded its profits and cash generation. It will not pay an interim dividend, having suspended payouts to shareholders back in June. Shares in Hornby slipped 1.4% this morning to 139p.' © Guardian News and Media 2009

So the moral of the story is, buy a Brawn F1 slot when they come out or one of our beloved slot manufactures may not be making all the slots we love so much. I KNOW I'll be getting one, even more so now!


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