1andrew1

Worth noting that we're now in an era of double-digit inflation. So an increase of sales of 3% is in reality a reduction in sales. The same rules apply to costs. In terms of the below-inflation increase in sales, it's interesting to see what toy company Spinmaster (owners of Meccano, Paw Patrol, Rubik's Cube, et al) said about the UK market in its Q3 results. I appreciate that not all of Hornby Hobbies' products can be classified as toys but I think it's useful background to consider. "The U.K. has been, by and large, the toughest market for a lot of people, us included, more from a promotional price deflation and just overall POS decline, and so that is the situation, and it's not new. It's been basically there for quite a few months." (See p40 Q3 Conference Call https://www.spinmaster.com/en-GB/corporate/investor-relations) In terms of possible cost-cutting, I do wonder if a new CEO might be tempted to integrate Oxford Diecast more into Hornby Hobbies and dispense with the Oxford Rail brand? I could see Basset Lowke being phased out and maybe Lima too.

Maybe real diesel exhaust to go alongside the simulation steam for steam trains? A virtual railway modelling system so you can plan your layout, add trains, share it with friends and see how it looks before creating it. Then ordering it all directly from Hornby.com?

Yes, one of their financial updates mentioned stock had increased as they'd had to increase orders of QuickBuild as they'd moved production to India which required longer production runs than the UK. As you say, the range was originally made in Sussex and Hornby made a bit of a thing about it. Doubtless, Indian-made kits will take a bit of time to trickle through.

Lol. I guess that was meant to be holding text pending the real wording?

I guess the dream would be from a very successful a multi-brand model company with online and third party sales, from another country. The closest to this would be is probably the Simba Dickie toy group owners of Marklin, Majorette die cast cars and Tamiya's continental distributor, alongside running many toy brands.

Interesting to see the new CEO joining from a high street retailer. https://polaris.brighterir.com/public/Hornby/news/rns/story/wko412x

At 1.22, you can see the Union Flag and the text "Designed and manufactured in the UK".

I agree it's likely to remain a one-off. But I saw an Airfix interview which said all their moulds are tooled up in the Far East. Regarding injection moulding for Airfix, that's not done in China but primarily in India with some in South Korea.

Exactly. Got hold of it by reading an email from CT9. 😁 This is the purpose of making that Spitfire kit in the UK - to generate positive stories in the press and remind punters of the Airfix brand. The marketing benefits for a few kits outweigh the savings of making the kit in India.

Yes, just remembered about Academy too after posting, edited it, then read your correction too.

My understanding from watching an Airfix video is that it's now just the 1/24 Spitfire which is being made in the UK. They're really doing this as a novelty as it's such a British plane. The Quick Build range is like most of the rest of the range, now made in India. That range was originally made in the UK as it had smaller production runs but cost increases and sufficient sales volumes made it worthwhile moving to India too. Hornby said that the cost savings are not in moulding but in packing the boxes which is quite labour-intensive. The main exception to India is South Korea. Airfix has an arrangement with Academy (distributed in the UK by Bachmann) whereby some Airfix military vehicles are made in South Korea by Academy, sometimes to Airfix designs, sometimes designed by Academy. This was done due to Academy's expertise in the scale (I think it was 1/35) and Airfix's design capacity.

The move into TT for Hornby makes sense to me but as most people have said, it's a bit of a gamble. On the making sense front: If Hornby is going to introduce newcomers to the Hobby, its marketing budget is best spent on pulling in newcomers to a gauge where it will have a high market share -TT - as oppose to OO gauge where there's robust competition. Hornby Hobbies has successfully introduced Micro Scalextric to fit in with smaller houses of today so there's logic in its doing the same thing with model railways. There are also possibilities, albeit limited, for shared models and accessories with the continental European market. The gamble obviously is whether Hornby can attract sufficient modellers to the gauge (both existing and new modellers) to make it viable. After the lockdown surge in modelling, are there many newcomers left to tap? And at a time when spare income is sucked up by fuel, food and other price hikes, moving gauges becomes harder to justify. I congratulate Hornby on the bold move and wonder whether the Trains on Film debacle was a distraction technique to wrong-foot its competitors? Or perhaps Hornby itself was too distracted by its TT gauge efforts to see the licensing issue with the Trains on Film range?

FYI From page 3 of the 2022 Annual Report and Accounts. Don't know if this relates to online orders too? "Further automation took place at the warehouse with the introduction of robots to improve our efficiency in fulfilling orders and in recent months we have increased our operating hours in order to despatch products more quickly." https://www.Hornby.plc.uk/annual-reports/

I doubt it's a significant enough amount to need to be mentioned. And there will have been other occasions when Hornby decided not to proceed with models after investing in R&D and tooling.

Just very strange that they ploughed on regardless. Two mistakes - the original one to try and release unlicensed models and the second one in not listening to expert feedback. They've a long history of successful licensing which makes it even stranger these models got to the catalogue stage.

I doubt that the accounts will get this granular. Hornby is not in Studio Canal's league but it's still a £50m turnover business.

The strange thing is that one Hornby Hobbies' key strengths must be in licensing. Corgi, Scalextric, Airfix, Hornby all depend on a large number of licences in their ranges. So how this unsatisfactory situation could have arisen beggars belief.

You would think so given the increase in container and fuel prices. A year ago, Hornby has decided to relocate the production of the Quick Build range from the UK to India so its recent move looks like a reversal of this policy. Understandable in the circumstances. In terms of : I wonder what the local markets might be? i'm thinking of emerging markets with tariffs so maybe manufacturing Scalextric track or Corgi in India or Vietnam for those emerging markets?

Appreciate it's share price has form. But even when the share price is at its lowest it has a high P/E ratio. To me, this says the market has a belief that Hornby will generate higher profits in the future.

I think the UK is more into online sales than Continental Europe so weaknesses in the website may not be so critical. Hornby Hobbies' performance in Europe seems to have been turned around from a loss to a profit but performance has worsened in the US. This looks in severe need of attention and I guess if they can't grow sales quickly they'll downsize or sell the US business. I suspect most sales in the US are Corgi, Scalextric and Airfix with the railway ranges being unimportant. However, Simply Wall Street has commented that Hornby's price/earnings ration (ie share price compared to profits) is high on current profits. https://uk.finance.yahoo.com/news/Hornby-plcs-lon-hrn-price-074404914.html

Just confirmed in the annual accounts as a change of provider. https://polaris.brighterir.com/public/Hornby/news/rns/story/w13dg3r

Is this not something like invoice factoring? ie Hornby gets paid for its invoices to shops by Secure Trust Bank who then take on responsibility for getting those invoices paid and chasing up payments? Given the seasonal nature of the business, this might be a more cost-effective way of handling its cash flow rather than having lots of people in credit control who are not needed for half of the year? But in terms of RNS announcements, not very significant.

If Rawnet are reading this (unlikely), they probably want to revise some of the brands in this sentence "Integrating international brands into the online portfolio - Electrotren, Lema, Rivarossi and Arnol, UF (international brands) - as they were badly represented previously" . It looks like someone has used a speech-to-text converter when designing the site. This is evident with UF instead of Jouef.

Cars sell in their thousands, model trains a few hundred.

I don't know if they still are, but in 2012, Scale Model News reported " In London, Humbrol enamels and finishing products are now made by Rustins, a family business established back in 1924 that offered Hornby a winning combo of price, quality and speed." https://www.scalemodelnews.com/2012/12/Hornby-brings-back-humbrol-paints-from.html#:~:text=The Hornby company’s model paint brand%2C Humbrol%2C known,after such operations went to China. US-UK story In 2017 Rustins were still the manufacturer: https://www.sunwardhobbies.ca/wp-content/uploads/2019/04/HUMBROL-ENAMEL-RANGE.pdf