The Nth Degree

Hello MGR, I also wanted the announcement in a standalone thread to maximise exposure – I think the cause is worth it alone. Where is your thread, I can't find it. Yes, all CAD/CAM is complete and tooling will start early next week. It will take approx 4 weeks to complete and squeeze out the first test sample, and from there at least one of each livery will be sent over for review. I'm hoping this will be complete within 6 weeks, but it won't take too much longer for full production to ramp up, so keeping my May deadline. If you can hold on a little longer you can see the actual models in each of their liveries. Thanks, Steve

I will reiterate exactly what you said. WOW!

I've just got back from the web people. As soon as the DNS have been populated the website should be up and running. Unfortunately they couldn't complete everything I wanted for today, but over the next week or two everything should be operable. I've bought me and the little fella some ice cream. We're now off to indulge. Have a great weekend all.

Thanks very much Steph. In a very early outline plan of this model your clever mini gearboxes were going to be used. Unfortunately no other British manufacturers could meet my spec and I reluctantly had to take the project offshore.

Thanks Derek, I've tried to reuse, and therefore share the cost, of as many components as possible. The sound system can be reused, with only a slight modification, the working headcode discs (which took two months of prototyping!), and a few other parts ensure that I'm not starting from scratch on every model. I've also tried to include free technology - Plux22 effectively costs no more, but will future-proof your model. The parts of the speaker system cost very little, but is worth quite a lot. Individually controllable lighting costs no more than block lighting. This ensures that those on DC are not penalised by the DCC-oriented spec - it would have cost exactly the same, or within £5.

Thanks Richard, very kind of you to say. If I ever get to play on Heyside I'll bring one over.

All in good time, sir, all in good time... My problem with the NBL locos is there's nobody to donate the money to! I'm currently talking to the Ballast Trust who hold all the plans.

Little Loco Company announces its first ready-to-run model BTH Type 1 / BR Class 15 supporting the Class 15 Preservation Society Little Loco Company, in association with the Class 15 Preservation Society, proudly announces its first model – a 7mm scale 0 gauge ready-to-run model of the British Thompson Houston Type 1, commonly known as the Class 15. From the outset we wanted to produce a high quality, innovative and accurate model that not only offered value for money, but gave something back to our railway heritage. We teamed up early in the process with the enthusiastic C15PS, who have supported and technically assisted us to ensure our model is as accurate as possible. In return for their help we will donate over £10,000 toward the restoration of D8233 – the only remaining Class 15. We believe our model will be the most technically advanced 0 gauge RTR yet produced. With a fully integrated Plux22 DCC socket (a first for 0 gauge) and independently controlled train classification lighting, PLUS working headcode discs (a first in any scale) you can choose whatever train classification you like - and change it again in a minute. Our model includes a built-in audio quality twin-speaker sound system. The bass reflex cabinet has been professionally designed with two 34mm speakers offering excellent bass response. This has been pre-wired to the Plux22 socket, avoiding both soldering and finding the space to cram in an after-market speaker. To create the space for this innovative sound system a unique low-slung die-cast metal chassis has been designed. This not only lowers the centre of gravity, making a more convincing and stable ride, but also encloses the flywheel-equipped high torque motor and cardan shafts. These in turn drive the durable gear trains in each bogie, with pick-ups on every wheel. A fully detailed cab interior, sprung metal buffers and couplings are, of course, included. All five running liveries are being produced, along with two Limited Editions; the Liverpool Street pilot and D8233 – the proceeds of which go directly to the C15PS. Each standard model will include alignment assisted numbering and detailing transfers with a choice of shed plates, making your loco unique to you. The price for the standard models is only £375, or £395 for the fully decorated Limited Editions. We are currently talking to retailers, and approved stockists will be listed on our website. You can also purchase directly from us with PayPal or secure online card payments. Delivery is expected in May, and you can reserve yours from this weekend on our website. BTH15-GDB Green with duck egg blue cab panels £375 BTH15-GDS As above with small warning panels £375 BTH15-GDF As BTH15-GDB with full yellow ends £375 BTH15-GSY All green with small warning panels £375 BTH15-GFY All green with full yellow ends £375 BTH15-LSP Liverpool Street pilot Limited Edition, fully decorated £395 BTH15-CPS D8233 Limited Edition, fully decorated £395 Thanks for your continued support and speculation – who wins the kitty? Steve

Now I've had some time to go through your previous thread I see you not got a couple 88s, but you've got five! Brilliant modelling. This takes me back to when I used to play 1/300 WWII battles. I moved away so didn't get to play anymore, but I'd love to get back into it.

It would be difficult to get a better combination of railway and WWII modelling. Truly wonderful. How about a couple 88s defending the bridge?

This looks likes an amazing project!

I thought you were the front-runner David. I have a feeling I know which group it is, and if I'm correct it is in very good hands indeed – certainly better than mine!

Well, it wasn't me...

I was surprised how close the prices are in Eastern Europe - I would estimate that setting up a factory would bring in a fist full of government grants too. They are more expensive, but not 'orders of magnitude' more expensive, and your employment costs can be regulated with types of contract. You could also bring in more work from outside - didn't Hornby used to make combs too? Plus, how much is a delay of a month or two worth when you have no control over schedules and miss your Christmas sales period? Quite a lot I reckon.

Why don't Hornby PLC own their own production facility? I'm totally lost on that. Every single product, except Humbrol, requires die-cast or injection moulded parts. Contracting this out to numerous factories must be very expensive, not to mention a logistics headache. My company is very small - I don't have the funds or expertise to create such facilities within it - but were I the size of Hornby it would be one of my priorities, and not in China either. I would choose Eastern Europe. the trade-off for a slightly higher production cost can be offset by setting my own schedules, maintaining much higher quality control and a more local oversight and speed to market strategy. I'm struggling to understand why a volume of product like Hornby's still needs to be contracted to higher-priced suppliers.

The article may have been referring to the period when Airfix was owned by Humbrol. Humbrol was indeed losing money - it went into receivership - but Humbrol was an expensive lumbering company with a factory in France, which was notoriously expensive to run and impossible to close because of French law. This was quite a while ago. Since Hornby's ownership it has become a much, much more efficient enterprise. How much it contributes has not been disclosed, but I very much doubt this particular business is making a loss.

Only two things can happen in the immediate future; they secure new terms/funding or they don't. The outcomes of both are very different. I'm confident enough to invest in them though. To answer your question, I have no idea!

In favour of model railways, of course. Because you don't specifically know of any other Hornby PLC product or market does not mean they are the reason for Hornby PLCs misfortune. As I've been saying, the PLC and the limited company are two entirely different entities which focus on two entirely different tasks. They are being mixed freely by most people. Have a look at the kit modelling forms – they are saying exactly the opposite to what you are saying. They are equally biased and equally ignorant of the company as they focus only on one product line. Or how about the die-cast vehicle collectors – they are saying something similar, too.

If you don't mind me saying, that's quite a biased and ignorant statement, and I disagree with every word of it. Hornby PLC is already segmented - each of the businesses operate their own budgets, management structure and development. It's only at the PLC level that they combine. The rest of it makes no business sense at all. Entry level 'anything' can, if marketed well, produce loyal and dedicated customers of higher value products. And as for kits, I would imagine they are considerable contributers to the bottom line, even though their share in total volume is lower than railways.

I'm the proud owner of 3000 shares this morning. It's looking quite good for a short-term investment, especially if a renegotiated finance facility can be quickly put in place before next month.

From my reading of the statement and the previous AR&A, I think your opening para may not be true – and I'm using 'may' because nobody knows how the model railway businesses are performing except Hornby PLC and Hornby Hobbies Ltd. Hornby PLC are the organisation in trouble – they are the company who have borrowed heavily to invest (ahem...) in the Group's reorganisation, etc. All they do is take money from each of the businesses (and those who lend it to them) and spend it. They effectively earn nothing themselves. The individual businesses within the PLC are performing OK, but not great, with the possible exception of Scalextric, who are tanking from what I read yesterday. I'm thinking that Hornby Hobbies Ltd, and the rest of the model railway brands would be a successful small company on its own, so too with the Airfix/Pocher/Humbrol mini-group. It seems that by trying to streamline the organisation, plus the disorganisation that followed, has created a less-than-expected return on its investment for this accounting period. With such tight margins, any small miss-hap will have disastrous effects on the bottom line, as they appear to have done here.

Fascinating reading through this thread, and a little nerve-wracking considering I've just started my own RTR company (gulp...). The only thing stopping me going greyer than I already am is that it seems Hornby PLC is the company in trouble, not necessarily the businesses within it. The PLC has spent a lot of money implementing its new data analysis software, reorganising its supply chain and distribution network - the infrastructure and logistics of the group as a whole. The individual businesses within the group seem to be trading OKish (baring the ERP mess), except maybe one. I think I had found a legitimate reference to a large loss in one of the businesses, but between cooking dinner and putting the little fella to bed I've lost it. I was reading about how Hornby PLC was hoping to revitalise traditional toys by sticking iPads onto them and giving them blogs and apps for the yoof market. They srarted the process with Scalextric, and had made a significant investment, but the financial results were awful, being well below expectations, especially in the US where they hoped to make significant sales. That was as far as I got up to, but there was quite a bit more to read. It was by a US tech/toy analyst written in early January. I'll carry on looking, but if anyone finds it can they post a link here perhaps?

Regarding share price, remember there is a buy price and a sell price. Everyone so far has been quoting the sell price, so you would have to hold stock already. Buying stock is usually priced higher - in Hornby's case, at this price level, it is 2p per share higher.

Does anyone know the quantity of model railway stockists in this country, or how that number has changed over the last five years, say? From that number, how many are so-called 'box-shifters' – or those that primary trade from their website? I would take a guess that the number of model railway stockists is declining and the vast majority of sales are internet-based. I'm not necessarily defending Hornby's strategy, but if the majority of sales are done online, why wouldn't they do that themselves to preserve their margins, instead of essentially 'paying' someone else for the privilege?

Hornby PLC has 39,160,000 shares issued, each one of those is worth less than 40p currently. It is possible that the whole PLC could be bought for a little over £15M at todays prices. The brands alone are worth more than that.