Perhaps the journalist spoke to an optimistic person at Hornby - or do you think he has an uncle with a layout in the loft and "knows something" about model trains?
QUOTE (Hornby PLC Trading Update)Hornby PLC
28 January 2008
Hornby Plc ('Hornby' or 'the Company')
Trading Update
Hornby is today issuing its regular update on trading for its second half to
date, including the important Christmas and January period.
Trading Update
Following a strong first half performance, the Company continued to experience
significant growth in the UK market during the pre-Christmas period. European
demand was also strong and sales increased significantly, although to a slightly
lesser extent than expected, due to delays in the rate of new product
introductions. Order intake and sales for the final quarter (January-March) are
expected to be above the strong levels experienced last year.
Strategy Update
The Company continues to make very good progress in rebuilding the sales of the
brands it acquired in Continental Europe. Hornby is in the process of
establishing itself as a strong contender in all key European markets. This
strategy of targeting stable, collector markets across Europe represents a
significant growth opportunity and will continue to broaden our operations and
reduce further the Company's dependence on the UK market.
It is clear that the rate of new product introduction required to meet market
demand in Europe is placing additional strain on our supply chain. Steps are
being taken to strengthen the management and manufacturing resources available
to the company in this respect.
The re-launch and future development of the acquired Airfix/Humbrol brands is
well under way. The new Doctor Who kit, produced under licence from BBC
Worldwide, has achieved widespread critical acclaim. The revitalisation of the
Airfix product range is continuing apace and this will lead to further sales
growth in all major markets. In addition to the Doctor Who licence the Company
has secured the licence for a range of Shaun the Sheep products and in classic
collection kits the much anticipated Nimrod kit will be launched before the end
of March.
Product Update
The Company's new products launched this month to our retail customers have been
extremely well received.
The further development of the Scalextric and Hornby digital ranges is expected
to continue to lead to an increase in average prices as consumers migrate to the
digital format. Scalextric continues to consolidate its position as the market
leader for digitally controlled slot-racing in most major world markets, and for
2008 Scalextric products based on the Vodafone Mercedes McLaren team and its
outstanding driver Lewis Hamilton will continue to set the pace. In addition the
company has secured the licence for a range of products based on the forthcoming
James Bond movie.
The Hornby Digital Control system for model railways is also expected to
continue to gain momentum during 2008. Positive feedback from early adopters,
coupled with new product introductions such as the infra-red controller,
locomotives featuring authentic sounds and more powerful electronic chips give
confidence that the Hornby system will be established rapidly in the main UK
market and also throughout Europe.
Chairman, Neil Johnson commented:
' A strong finish to 2007 shows once again that Hornby is extremely resilient in
times of economic uncertainty.
' Strategically, we have continued to make very good progress in building a
broadly based hobby business across Europe. There is excellent potential to
continue this process and to leverage the brand strengths we have in the key
European markets. The acquired Airfix/Humbrol brands are expected to continue to
build on the strong growth already achieved, with further significant
opportunities to develop this business in new markets over the coming years.'
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