Picture: Andy Jones/Southeastern
Scale model manufacturing company Hornby experienced an upsurge in sales for the last quarter of 2024.
The firm, which has been based in Margate for 70 years, issued a trading update this month for the period between October 1 and December 31.
Group sales were 7% ahead of the same period for 2023, bucking the trend reported by the British Retail Consortium that UK non-food sales decreased by 1.5% versus previous year for the three months to 31 December.
Hornby group sales for the financial year to date are 8% ahead of last year, and gross profits are ahead by 10%.
A particularly strong sales period was noted for Black Friday and Christmas with 23% revenue growth and 38% gross profit growth versus the previous year for the month of December. Almost 50% of all Black Friday transactions came from first time customers, up from 42% in 2023.
Net debt marginally reduced in the quarter and was at £18.2 million by the end of December, compared to net debt £18.8 million at the end of September 2024.
The news follows on the heels of the most recent half yearly report that indicated Hornby is likely to continue with job reductions into 2025 as part of a three year turnaround plan.
The firm has already made ‘significant’ headcount reductions with savings of around £1m of central costs in the six months to 30 September, 2024. A further £500,000 of savings are expected in 2025.
Our current forecast to year end March 2025 remains on track for year-on-year growth, and we continue to work on many of the turnaround initiatives outlined in the Annual Report and our Interim Results.
Hornby CEO Olly Raeburn said: “In a tough economic climate, we are pleased to be able to report growth in revenue, margins and gross profits through this critical quarter.
“Concurrently we are continuing to drive down the inventory levels that had built up in recent years and are delivering our change plans in a steady and sustainable way. Our turnaround is very much on track as we further reduce central costs, focus on our core brands and improve operational processes across the business.”
The Hornby turnaround plan is being carried out with consultancy from Mike Ashley, through MASH holdings.
The Frasers group, which also owns GAME and Sports Direct, increased its shareholding in Hornby across February and March last year and now owns a 9% stake.
Hornby is moving logistics operations from Hersden, near Canterbury, to a new partner in the Midlands to “significant operational, service and cost efficiencies in 2025.”
At the end of last year the firm completed sale of its Oxford Diecast to EKD Enterprises Limited, a company owned by Lyndon Davies who stepped down from the Board and his role as a Non-Executive Director of Hornby with immediate effect.
Hornby has also secured an exclusive licensing agreement with Ferrari for the Pocher brand and there are also new distribution partners in China for this brand with “opportunity to grow the footprint of this premium brand in the Far East” The first Ferrari kits will be available in early 2026.
Potted history
Hornby Railways’ roots date back to 1901, when founder Frank Hornby received a patent for his Meccano construction toy. The first clockwork train was produced in 1920 in Liverpool.
In 1938, Hornby launched its first 00 gauge train. Production was suspended in 1942, during the Second World War. Production resumed after the war but did not reach full capacity until 1948.
In 1964, Lines Bros Ltd, the parent company of rival Tri-ang Railways, purchased Meccano Ltd., and merged Hornby and Tri-ang into Tri-ang Hornby at the Margate site. The former Hornby line was discontinued in favour of Tri-ang’s less costly plastic designs.
The Tri-ang group was disbanded in 1971 and Tri-ang Hornby was sold to Dunbee-Combex- Marx, becoming Hornby Railways in 1972.
Hornby Railways became independent in the 1980s. Production continued at the Ramsgate Road factory until the 1990s, when it transferred manufacturing to Asia and the old factory became a warehouse.
In July 2010 the Hornby Shop And Visitor Centre opened. In June 2013 the firm announced that it was shifting its warehouse to Hersden, near Canterbury, and in May 2015 the remaining sections of the business moved to Discovery Park.
A restructure of top management in 2017 led to the welcome return of Hornby offices in Margate and the creation of a new showroom alongside Locomotive Storage which bought the site when Hornby moved out.
