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Hornby issues profits warning Hornby in profits warning as Olympics sales disappoint
(35 minutes later)
Toymaker Hornby has said it will not make a profit this year, due to disappointing sales of London 2012 merchandise and supply problems. Model maker Hornby has said it will not make a profit this year, due to disappointing sales of London 2012 merchandise and supply problems.
Lower-than-expected sales of Olympic merchandising meant retailers cancelled repeat orders, it said. It also expects substantial disruption to production at one of its major suppliers in China. Lower-than-expected sales of Olympic products meant retailers cancelled repeat orders, href="http://online.hemscottir.com/ir/hrn/ir.jsp?page=news-item&item=1167258294437657" >it said. It also expects substantial disruption to production at one of its major suppliers in China.
With consumer spending remaining depressed, the firm expects to break even in the 2012-13 financial year. With consumer spending still depressed, the firm now only expects to break even in the 2012-13 financial year.
Last year, it made profits of £4.5m.Last year, it made profits of £4.5m.
Hornby, which owns the Scalextric and Corgi brands, gained the licence to sell a range of London 2012 merchandising, including replica mascots and a Scalextric velodrome.
This year, the firm said its performance would be "constrained significantly".
It said it would try to find alternative sources of products to try to reduce the disruption created by its Chinese supplier, which is rationalising its manufacturing.
This supplier currently represents 35% of Hornby's purchases, but at its peak had accounted for about 75%.