Hornby reported a 3 percent fall in first-half sales and said it was cautious about UK trading in the second half and key Christmas period, sending its shares 11 percent lower on Friday.
"Market indications for Christmas trading in the UK are not encouraging, and I must therefore sound a cautionary note in respect of trading in the second half," Chairman Neil Johnson said in the results statement.
"The results are disappointing. The problem is that the UK high street is absolutely dire at the moment," analyst David O'Brien from Altium securities said, adding that a downgrade is on the cards.
Hornby reported that its international businesses were performing ahead of expectations, however, boosted by new licences.
"Given the potential of the re-invigorated European brands we have high hopes for a growth in European sales," Chief Executive Frank Martin said in the statement.
File photo shows CEO Frank Martin. REUTERS/Vismedia
Sounds a little depressing. To lighten things up, who can identify the trains in the photo?