Hornby profits from return to tradition

Click to follow
The Independent Online
Hornby, the toy company, has benefited from its return to its model-railway and Scalextric roots with a sharp increase in profits for the six months to September.

However, the shares drifted into the sidings with a 7p drop to 244.5p on a cautious Christmas trading statement. Peter Newey, chairman, said: "It must be pointed out that parts of the retail sector have expressed concern regarding the current level of pre-Christmas trading and that demand in January to March of this year was particularly strong because of the sell-through of our products during Christmas 1995 which may not be repeated next year."

The downbeat statement comes just a day after Kingfisher said its Woolworths stores were enjoying healthy toy sales. Mr Newey was speaking as Hornby announced profits of pounds 1.1m in the six months to September compared with pounds 272,000 in the same period last year. They were damaged by losses in former subsidiaries such as the Fletcher speedboat business, which was sold in February.

Hornby's agreement with Nikko to distribute the its radio-controlled model cars has been terminated as the group wants to take control of its own UK distribution. Group sales were down from pounds 13.7m to pounds 13.1m. However, sales of higher-margin railway and Scalextric were 15 per cent above the first half of last year.

Alan Cox is standing down as finance director. He will be replaced by John Stansfield, presently finance director of Hornby Hobbies.