Hornby Loss

[woodenhead]

3 minutes ago, Chris M said:

I'm not sure I ever saw DJM feted in the same way as Accurascale. One was always considered to be a bit iffy by many (I wish I had listened) while the other is producing some excellent models.

Oh he was, he had his fan club, people who would not entertain the idea that he was a little bit iffy.

 

To be honest it was all quickly forgotten when Accurascale came along, luckily they put their money where their mouth was pretty quickly and convinced people they were bona fide.  There was a chap around the same time who wanted to build a loco, think it was in O, he hid behind a facade and wanted cash for his plans - he was quickly chased away because DJM's failure was still burning bright.

[Steamport Southport]

19 minutes ago, woodenhead said:

Oh he was, he had his fan club, people who would not entertain the idea that he was a little bit iffy.

 

To be honest it was all quickly forgotten when Accurascale came along, luckily they put their money where their mouth was pretty quickly and convinced people they were bona fide.  There was a chap around the same time who wanted to build a loco, think it was in O, he hid behind a facade and wanted cash for his plans - he was quickly chased away because DJM's failure was still burning bright.

 

There was also the start of KR Models.

 

No details who they actually were, yet wanted us to put a deposit down on a model...

 

Seemed a bit iffy. Obvious wasn't, just a bit of naivety on their part.

 

 

Jason

[woodenhead]

1 minute ago, Steamport Southport said:

 

There was also the start of KR Models.

 

No details who they actually were, yet wanted us to put a deposit down on a model...

 

Seemed a bit iffy. Obvious wasn't, just a bit of naivety on their part.

 

 

Jason

I was gonna mention them, but decided it might be read the wrong way because whilst not the best business model and it does place a lot of risk in the hands of the purchaser, they are a model company who have and are delivering goods and a lot more so far than DJM ever did off his own back.

[Roy Langridge]

2 hours ago, D9020 Nimbus said:

Perhaps it's worth pointing out that we know Hornby is making a loss because it is a PLC. The other companies in the market are all privately owned so we have no way of knowing whether they are profitable or not. It was quite a while before people realised that DJM was in trouble; at one time they were feted in much the same way as Accurascale and the like are now.

Nowt to do with being a plc, all listed companies under the Companies House for England and Wales have to publish their accounts, private or publicly owned. 

Roy

[JohnR]

39 minutes ago, Roy Langridge said:

Nowt to do with being a plc, all listed companies under the Companies House for England and Wales have to publish their accounts, private or publicly owned. 

Roy

 

Indeed - if anyone wants to pick over Bachmann Europe's accounts, here they all are:

 

https://find-and-update.company-information.service.gov.uk/company/02392907/filing-history

[woodenhead]

29 minutes ago, JohnR said:

 

Indeed - if anyone wants to pick over Bachmann Europe's accounts, here they all are:

 

https://find-and-update.company-information.service.gov.uk/company/02392907/filing-history

So into loss 2016 and 2017, then an annual improvement 2018-2021 all in profit.

[County of Yorkshire]

2 hours ago, Roy Langridge said:

Nowt to do with being a plc, all listed companies under the Companies House for England and Wales have to publish their accounts, private or publicly owned. 

Roy

Correct, with the caveat that there are exemptions, depending on the size of the company. For example, the smallest companies who turnover below a certain figure, only need submit abbreviated accounts, in which a mini balance sheet is present, but no P&L. Conversely, the larger PLC must publish audited full accounts. 
 

Thus it is expected that Hornby’s accounts are much more comprehensive, compared to the relative minnows like Accurascale & Rapido (UK)

Edited December 2, 2022 by County of Yorkshire

[McC]

Under £10.2m in turnover you can file abridged accounts. 

[Steamport Southport]

1 hour ago, woodenhead said:

So into loss 2016 and 2017, then an annual improvement 2018-2021 all in profit.

 

Pretty sure that was when all those models were delayed for various reasons. If they haven't got them to the shops then we can't spend the money on them. I'm afraid the money goes elsewhere and if manufacturer X has a new model out that I want then it goes there.

 

Thinking GWR 94XX, LNER J72, LNER V2, Class 90, etc.

 

 

 

Jason

[woodenhead]

1 hour ago, Steamport Southport said:

 

Pretty sure that was when all those models were delayed for various reasons. If they haven't got them to the shops then we can't spend the money on them. I'm afraid the money goes elsewhere and if manufacturer X has a new model out that I want then it goes there.

 

Thinking GWR 94XX, LNER J72, LNER V2, Class 90, etc.

 

Jason

But they managed to get back to solid profitability without:

• re-inventing a scale, but the 009 stuff is very welcome thank you
• alienating their retailers and sidelining them
• a big song and dance
• dropping QC

They have though in this period:

• reacted to competition
• upped their game
• added ready to go sound and Next18 into it's N gauge - even in diminutive locomotives
• worked with retailers to develop special commissions and bring more stuff to market

[1andrew1]

4 hours ago, Roy Langridge said:

Nowt to do with being a plc, all listed companies under the Companies House for England and Wales have to publish their accounts, private or publicly owned. 

Roy

Only quoted companies have to publish half-yearly results. So we know Hornby has made a loss in the first half but we don't know if the other players made a loss in the equivalent period.  

 

So whilst Bachmann and Peco do publish their profit and loss accounts, they only publish their accounts annually. And the others like Dapol  have taken advantage of exemptions and do not report their profit and loss accounts.

 

 

Edited December 2, 2022 by 1andrew1

[1andrew1]

3 hours ago, woodenhead said:

So into loss 2016 and 2017, then an annual improvement 2018-2021 all in profit.

In Hornby's case, losses in financial years 2016 to 2020 inclusive then profits in financial years 2021 and 2022. https://www.Hornby.plc.uk/profit-loss/income-statement/

 

(Hornby's financial year end is March and Bachmann's is December.)

[Steamport Southport]

13 minutes ago, woodenhead said:

But they managed to get back to solid profitability without:

• re-inventing a scale, but the 009 stuff is very welcome thank you
• alienating their retailers and sidelining them
• a big song and dance
• dropping QC

They have though in this period:

• reacted to competition
• upped their game
• added ready to go sound and Next18 into it's N gauge - even in diminutive locomotives
• worked with retailers to develop special commissions and bring more stuff to market

 

Hattons? By far the biggest UK model retailer treated like dirt for having the affront to sell a rival model.

 

 

 

Jason

[Andy Hayter]

A slight simplification IMHO.

 

Yes Hattons did commission a version of the model that Bachmann were about to release and they did sell it  - but they also offered it across the entire trade to also sell in competition to Bachmann.  You can of course consider that as fair competition others might see that as direct competition.  Bachmann took the latter view

 

How many Bachmann models are on offer on the Hornby site?  Same principle in a different context.

[1andrew1]

I can see how Hornby would be keen to take a share of retail sales given Hatton's historic profitability with far lower sales.

 

Hornby
31/03/2021 Sales £48.55m Post-Tax Profits £1.36m
31/03/2020 Sales £37.84m Post-Tax Loss -£3.4m 
31/03/2019 Sales £32.76m Post-Tax Loss -£5.3m
31/03/2018 Sales £35.65m Post-Tax Loss -£9.9m 

 

Hattons
30/06/2021 Sales £12.40m Post-Tax Profits £604k 
30/06/2020 Sales £12.58m Post-Tax Profits £454k
30/06/2019 Sales £14.75m Post-Tax Profits £840k
30/06/2018 Sales £14.41m Post-Tax Profits £975k

 

Bachmann
31/12/2021 Sales £16.33m Post-Tax Profits £334k
31/12/2020 Sales £13.14m Post-Tax Profits £268k 
31/12/2019 Sales £13.92m Post-Tax Profits £135k
31/12/2018 Sales £13.54m Post-Tax Profits £195k
 

Edited December 3, 2022 by 1andrew1

[woodenhead]

10 hours ago, Steamport Southport said:

 

Hattons? By far the biggest UK model retailer treated like dirt for having the affront to sell a rival model.

 

 

 

Jason

Hattons were doing more than a 66 and they were wholesaling some of these models to other shops as well, cherry picking the 66 for themselves in a sort of Hornby Direct Sales only approach.  I like Hattons, used to use them a lot when they did Farish, but it was a massive land grab by them when Bachmann & Hornby were having difficulties with supply - it could have gone two ways - Bachmann failed to rebuild and Hattons was well placed or Bachmann got it's act together and moved back into profitability - the latter happened and Hattons found themselves out in the cold with regards Bachmann.   They've since gone on and found themselves in a low tier with Hornby too.  In that same period Kernow managed to steer a route to commissioning that did not break the relationship with Bachmann and Rails have forged relationships too to be a commissioner and a retailer.  If you look at Hattons now, beyond the generic coaches (very nice) what Hattons built model trains are planned?

[Legend]

9 hours ago, 1andrew1 said:

I can see how Hornby would be keen to take a share of retail sales given Hatton's historic profitability with far lower sales.

 

Hornby
31/03/2021 Sales £48.55m Post-Tax Profits £1.36m
31/03/2020 Sales £37.84m Post-Tax Loss -£3.4m 
31/03/2019 Sales £32.76m Post-Tax Loss -£5.3m
31/03/2018 Sales £35.65m Post-Tax Loss -£9.9m 

 

Hattons
30/06/2021 Sales £12.40m Post-Tax Profits £604k 
30/06/2020 Sales £12.58m Post-Tax Profits £454k
30/06/2019 Sales £14.75m Post-Tax Profits £840k
30/06/2018 Sales £14.41m Post-Tax Profits £975k

 

Bachmann
31/12/2021 Sales £16.33m Post-Tax Profits £334k
31/12/2020 Sales £13.14m Post-Tax Profits £268k 
31/12/2019 Sales £13.92m Post-Tax Profits £135k
31/12/2018 Sales £13.54m Post-Tax Profits £195k
 

Comparing  Bachmann not really relevant . Remember for most of its models ( not EFE , I think) it has to pay Kader . There’s probably a profit residing in Kader for goods transferred to Bachmann Europe , so it’s not the complete picture . It’s called Transfer Pricing . 
 

Interesting to see sales drop in Hattons 2019- 2020 . Is that the effect of loss of Bachmann and the Hornby Tier system? I can’t remember the timing now . Interesting their pretax profits increasing again . Well done them , although behind it there may have been restructuring and people losing jobs .

[Dunsignalling]

20 hours ago, Steamport Southport said:

 

What whole range was pulled?

 

It was two meaningless train packs which consisted of items which Hornby already make.

 

Don't forget Hornby still have a contract with Studio Canal and this entire Titgate thing was blown up totally out of proportion by those with a grievance against Hornby.

 

If anything it was Rapido treading on Hornby's toes. It was common knowledge Hornby was doing Lion even before we knew they were doing rocket. We saw it on a whiteboard about five years ago....

 

 

Jason

A valuable lesson for Hornby. If they hadn't taken the hint after "Terriergate" they should now have absorbed the message that nothing is "theirs", unless they hold exclusive IP rights.

 

For most older locomotives, that's not possible and, conversely, I wonder if Hornby has an exclusive licence (for OO and TT, others have "done" it in O and N) with the NRM for Flying Scotsman (who presumably own the merchandising rights). Even if they have, there were lots of other A3s....

 

In relation to "Titgate" the issue wasn't about Lion or even (most of) the other individual models, but rather the packaging and promotion of them.

 

One company carried out due diligence and observed the legal niceties with the copyright holder, the other seemed to consider itself above all that stuff.

 

Fortunately for Hornby, it appears that their own legal eagle pointed out, in timely fashion, the potential consequences of a very asymmetric legal dispute over a matter in which they probably hadn't a leg to stand on.

 

John

 

 

Edited December 3, 2022 by Dunsignalling

[jjb1970]

Something thing I like about Bachmann is they just go about their business and provide high quality products without the soap opera stuff of some companies. I am sure they have their moments behind the scenes but they don't air washing in public. This may just be me but I think there's a lot to be said for companies which just get on with things.

[jjb1970]

20 hours ago, spamcan61 said:

Not just China, this goes on in pretty much every multi-national company I've worked for/with over the last 40+ years 

 

I believe the preferred corporate term is tax efficiency. Energy companies were always notorious for it simply because the numbers were so large.

[adb968008]

14 hours ago, Andy Hayter said:

A slight simplification IMHO.

 

Yes Hattons did commission a version of the model that Bachmann were about to release and they did sell it  - but they also offered it across the entire trade to also sell in competition to Bachmann.  You can of course consider that as fair competition others might see that as direct competition.  Bachmann took the latter view

Which model would that be then ?

The 66 has only ever been “in store”, the P, AB, RHTT, Snowploughs have no direct competitor product… let alone Bachmann having a product “about to release”.. the Bachmann 66 is a decade+ old… Hattons was the newcomer, not Bachmann. 

Its a good (and most likely) guess why Bachmann / Hattons apparently ceased relations, but that doesnt explain Hornbys move, which feels to me more like a land grab of web retail, which ignores the sheer depth of range Hattons has that Hornby does not.

 

If anything they are opposites.. Hattons were expanding commissions, Hornby was expanding retail… imo Both were seeking ways to increase margin by reducing expenses.

I think both are missing the game. If either wants a land grab at retail with higher margin by taking out a middle man they need to become a whole of market supplier, retailer and comissioner.

Hattons has the depth of market, Hornby has the supply.. a merger of both would create a “Walthers”… other competitors exist on both sides who could also merge and do the same, but to me thats a  logical step in the UK hobby, an open field of play in what is now a mature sated market.

 

 

 

 

 

 

 

 

 

 

Edited December 3, 2022 by adb968008

[D9020 Nimbus]

Ii's been stated before that Modelleisenbahn GmbH (Roco/Fleischmann) own at least part of the German retailer Modellbahnshop-Lippe, although the latter certainly sell products from all major manufacturers. So Hornby buying Hattons (assuming they could afford to!) might make sense.

 

Hattons seem to see most of their business these days in second-hand models, judging by their adverts. They're even the biggest advertiser in Model Railroader, purely advertising to purchase second-hand models.

 

There seems to me a big difference in the character of Bachmann and Hornby. David Haarhaus comes across as essentially a rather cautious individual, albeit one who has a very clear grasp of the risks the business faces. Simon Kohler comes across as more of a gambler—and TT-120 clearly represents such a gamble. Though it's worth noting that Arnold within the Hornby group has experience of TT, while no companies in the group have any experience of narrow gauge. Conversely, Liliput have narrow gauge experience, but no Bachmann company has any experience of TT.

 

Curiously enough, in other countries where Hornby has a presence, they seem to be expanding their presence in N gauge, particularly in France, Spain and Italy, to the extent they've become the major supplier of N gauge in France (displacing Minitrix).

[spamcan61]

50 minutes ago, D9020 Nimbus said:

 

 

Hattons seem to see most of their business these days in second-hand models, judging by their adverts. They're even the biggest advertiser in Model Railroader, purely advertising to purchase second-hand models.

 

 

This has been very noticeable over the last couple of years, and I don't think it's confined to Hattons, several of the big/medium sized players have been devoting much of their advertising pages in the magazines to second hand. I assume this is at least partially due to lack of availability of new product from the manufacturers. 

[woodenhead]

The more the merrier when it comes to secondhand, with more than two retailers after your items you may get more for your items than if it was just Hattons and Rails

[ruggedpeak]

17 minutes ago, spamcan61 said:

This has been very noticeable over the last couple of years, and I don't think it's confined to Hattons, several of the big/medium sized players have been devoting much of their advertising pages in the magazines to second hand. I assume this is at least partially due to lack of availability of new product from the manufacturers. 

I suspect it is also because the margins per item are also better than new, at least in the UK. Much like many other sectors of business these days.