[woodcote]

   

Hornby plc have reported their half year figures up to September. You can read the pdf document here: https://wp-hornby-2020.s3.eu-west-2.amaz...-FINAL.pdf

The headline figures are:

• Group revenue of £21.8 million (2020: £21.1 million) an increase of 3% on prior year
  
• Operating Group loss before tax of £0.3 million (2020: profit of £0.2 million)
  
• Statutory loss before taxation for the period of £0.7 million (2020: profit of £17,000)
  
• Net cash £0.2 million (2020: Net cash £4.0 million)
  

Chief Executive Lyndon Davies is quoted in the document,

Revenues have marginally increased in the first half, despite being held back by supply disruption. Container shipping costs have soared, requiring us to raise our selling prices in August to cover this. Shipping times from our overseas factories have nearly doubled to circa 70 days, whereas pre-covid this was around 35-40 days. We have now taken the pain for those lost sales.

Demand for our products is higher than ever, therefore it is disappointing to have experienced the supply chain problems which seem to be easing but remain volatile. We are heading into our key Christmas trading period and right now it is hard to tell what the outcome will be for the full year results. However, we are as well placed as we can be with our order book 35% higher than it was a year ago.

The full report gives an interesting insight into the problems impacting on pretty much all manufacturing supply chains worldwide - and particularly the issues of labour and power shortages in China.

[BAracer]

All I know about results are what I pick up from the CEO at work. He puts 'net cash' almost above everything else, so the Hornby figure for that compared to last year jumped out at me.

[ScorpiusWireless]

“Demand for our product is higher than ever”. I’m not sure fooling the shareholders is a clever move.

2020 turnover 20millGBP
2005 turnover 45millGBP (adjusted for inflation around 60mill)

I’m also sure I recall one year was $60millGBP turnover.

So 15 years on and turnover has declined by 2/3. I’m guessing Carrera had taken most of that. 

Interesting in 2005 approx 5% sales in USA and 5% in Europe.

So a 200,000 GBP profit with 20mill turnover. As a comparison the average small business would generate that with only 1.5mill turnover.

If this new chap has a Silicon Valley background and raced slot cars as a kid Hornby might be in for a chance. Hopefully they can take digital to the next level and concentrate on expanding back into Europe and USA markets where you have a combined population of 1bill not 60mill.

[ScorpiusWireless]

With supply chain issues (Carrera had the same scenario but made a profit, go figure), shipping costs doubling, wages doubling in China in recent times it might be time to bring it “back home”. 

In comparison the Revell Carrera group turned over 130millEUR (110millGBP)
Or 5 times more turnover.

Rick

[Bazzer]

OK we get it you don't like Hornby.

[ScorpiusWireless]

OK we get it you don't like Hornby.

Well you think that. Not sure you are “we”. 
As I told you in a similar thread I grew up with Scalextric and love it. I’m just stating the financial changes (yes facts) over the years and it’s mainly due to product choices and marketing in my opinion. 
I thought as as a Hornby fan you’d want to see them survive. I thought you may be concerned that turnover has dropped 2/3 in 15 years.
If this continues how long do you think they will be around for without a government bail out. Go on FB and all the forums. It’s all Carrera.
Rick

[woodcote]

By all accounts, the Scalextric part of the Hornby empire is doing very well. At the helm are two experienced and talented young managers, one of them a slot car racer/collector from when he was a kid. The small team work very hard to reach out to hobbyists in the UK - where Carrera simply don’t bother to tread, such is Scalextric’s dominance in the market.

The wider company has certainly turned a corner and appointed a young (my age) CEO earlier this year, who arguably has talents that are more wide-reaching than the ‘old guard’. He inherits a company that - despite the challenges of the pandemic - is either making a small profit or small loss each quarter. Sales across the board are up, but so are costs. Those rising costs aren’t unique to Hornby and pre-date COVID. The company have - over the past few years - shifted new production to Vietnam to keep costs down and solve supply issues.

One issue Hornby has - and the Scalextric team seem to have fixed successfully - is excess stock build-up, ie unsold product sitting in the warehouse. Hornby have recently re-recruited Martyn Weaver as Hornby trains brand manager. He turned this issue round for Scalextric - as well as re-launching the Micro Scalextric and TV & Movies lines that have been so successfully for Scalextric and pretty much fund the nice stuff that we drool over in the catalogue each year.

Another recent development is that the rather tired Visitors’ Centre in Margate has been completely transformed by the new CEO and The WonderWorks looks absolutely sensational in the teaser posts on social media. I’m hoping to visit next week. This transformation reflects what the company is trying to do - being bang up to date and celebrating nostalgia. This fusion is exciting and taps into a huge marketplace of all ages.

If you want to know the latest Hornby facts and expert commentary, simply Google Hornby and select the News tab. There’s plenty of stuff from the UK financial pages and websites. The Hornby website has all the annual reports, quarterly statements etc via the Investor Relations link at the bottom of each page.