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.

3 hours ago, papagolfjuliet said:

I am moved to ask how much of that loss can be ascribed to the legal costs of Hornby's decision to pick a fight with an enormously wealthy French mass media company.

Minimal. A bit of wasted development and artwork but that's about it. No compensation due as Hornby binned the "Inspired by range".

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?

2 hours ago, Pre Grouping fan said:

Dragging this a few pages forward... 

 

Looking at recent quick build releases the sticker with the factory code etc is still the same as it always has. I've stuck enough of them on the boxes to have it engraved in my mind! 

 

The UK company featured in the 1st UKTV series on Hornby so has everything changed since that was aired?

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?

22 hours ago, Oldddudders said:

Where would we like the CEO to come from?

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.

Quote

"Oliver has an extensive background in marketing, becoming Chief Marketing Officer of Paperchase in 2019, whilst it was in a Creditors' Voluntary Arrangement. He was promoted to CEO in 2020 and he guided the company through an administration process during the Covid pandemic. This was followed by a turnaround process, refinancing and sale of the business."

Upon Oliver starting in the business on 23 January 2023, Lyndon Davies, the current Executive Chairman, will become Non-Executive Chairman.

 

https://polaris.brighterir.com/public/Hornby/news/rns/story/wko412x

3 hours ago, toboldlygo said:

Looks promising, no union flag on the box.

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

3 hours ago, bmthtrains - David said:

Having spoken to several people from Airfix about this in a professional context, I got a sense they were possibly regretting this as it’s simply shown up how much better skilled the Chinese are at tooling and injection moulding, particularly for models. I wouldn’t be surprised if this remains a one-off.

 

David 

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.

8 hours ago, Flying Pig said:

 

 

"Got hold of it" just before Christmas.  Hmm...

 

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.

2 minutes ago, toboldlygo said:

The armour range are produce by Academy in  South-Korea.

 

The Spitfire is being produced in limited numbers, so I suspect if you pre-order now, you'll get it in early 2023.

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/

9 minutes ago, JohnR said:

 

Probably under the heading "Exceptional Items"

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. 

14 minutes ago, AY Mod said:

 

It's worth mentioning that we, as in the printed media, tried to give our views at the media briefing on 07 December - before anything was publicly announced.

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.

12 minutes ago, JohnR said:

The statement will have gone through the lawyers, no doubt Hornby's will have wanted it as bland as possible, Studio Canal's will not. So they come to an agreement. 

 

I wonder what the cost of the legal side was, and whether it would be reported in the next set of accounts? I would imagine it would also include the cost of SC's lawyers. 

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. 

9 minutes ago, John M Upton said:

Someone is getting fired....

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. 

7 hours ago, eldomtom2 said:

Plastic kits seem a highly viable field for UK production - see companies like Games Workshop.

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 :

Over the last 12 months we have been planning more production outside of our main China base. This involves

laying down duplicate tooling on some evergreen products in other countries. This should not be seen as a movement out of China, but rather an opportunity to work with new manufacturers on our extensive range of existing products; not just to supply ourselves, but also to build new demand in their local markets.

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.

On 18/06/2022 at 08:48, SamThomas said:

Not really impressed with the new website, although I'm only looking at the European HO side.

 

Someone needs to check the images on the Lima section though - a number of buffer heads missing !

 

Maybe I missed it but an "achieve" section would be nice & useful.

 

I do feel that Hornby are losing out on European sales, I get the impression that these models are overlooked which is a great pity - the current offerings from their European HO stable are certainly up there with the other European manufactures.

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.

Quote

Sales by the European businesses of £11.4 million increased by 93% in the year reflecting the Group's focus on growing these markets through correct product selection and overcoming the shipping issues we experienced post Brexit. The profit before tax was £0.8 million compares to £0.5 million loss last year.

 

Sales in the US business of £4.6 million decreased by 13%. The trading loss of £0.7 million compares to £0.3 million loss in last year. We expect sales to increase in this key market in the longer term and overheads to reduce.

 

However, Simply Wall Street has commented that Hornby's price/earnings ration (ie share price compared to profits) is high on current profits.

Quote

Hornby PLC's (LON:HRN) price-to-earnings (or "P/E") ratio of 35.6x might make it look like a strong sell right now compared to the market in the United Kingdom, where around half of the companies have P/E ratios below 14x and even P/E's below 7x are quite common. However, the P/E might be quite high for a reason and it requires further investigation to determine if it's justified.

 

The earnings growth achieved at Hornby over the last year would be more than acceptable for most companies. One possibility is that the P/E is high because investors think this respectable earnings growth will be enough to outperform the broader market in the near future. You'd really hope so, otherwise you're paying a pretty hefty price for no particular reason.

 

https://uk.finance.yahoo.com/news/Hornby-plcs-lon-hrn-price-074404914.html
 

Just confirmed in the annual accounts as a change of provider.

Quote

32. EVENTS AFTER THE END OF THE REPORTING PERIOD

On the 21 April 2022 we transferred our Asset Based Lending Facility from PNC Credit Limited to Secure Trust Bank PLC.

https://polaris.brighterir.com/public/Hornby/news/rns/story/w13dg3r

8 hours ago, Pandora said:

£12million, but I cannot find anything for the interest rate and term of the loan, the interest rate being a clue to the perceived risk of Hornby,  and  what is the loan secured against,  inventory? The Hornby property portfolio?

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.

On 13/05/2022 at 12:42, AY Mod said:

 

You can do your own specific homework here - https://www.rawnet.com/about - https://www.rawnet.com/our-work/Hornby-hobbies

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.