- Hornby said Black Friday contributed to 10% revenue growth
- Hornby’s share price has fallen by over 40% in the last year
Hornby shares rose on Wednesday after the group unveiled strong sales and a flurry of new customers in the run up to Christmas.
The British-based model railways manufacturer said sales were 5 per cent higher from 1 October to 31 December compared to the same spell the previous year.
Cumulative group sales for the financial year-to-date were 6 per cent higher than the previous year.
Sales growth: Hornby shares rose on Wednesday after the group unveiled strong sales for the Black Friday and Christmas periods
Hornby said solid Black Friday sales contributed to 10 per cent revenue growth when compared to November the year before.
Over 50 per cent of all Black Friday transactions came from first time purchasers.
Margins for the quarter were 46 per cent, up from 43.8 per cent at the half year point. Direct to consumer sales came in 30 per cent ahead of the same period the previous year.
On stock levels, the group said: ‘Inventory is £22million, down from £24million at the end of September 2023 as a consequence of our ongoing focus on reducing aged stock in tandem with driving sales of newer product.’
Hornby shares were up 3.16 per cent or 0.49p to 15.99p on Wednesday, having slumped over 43 per cent in the last year.
While the group enjoyed a strong quarter, its performance has been turbulent for some time.
The group wants to cut excess stock levels, turn its financial fortunes around and continue attracting new customers.
On Wednesday, it said its net debt at the end of December was £13.5million, down from £14.6million at the end of September.
Olly Raeburn, Hornby’s chief executive, said: ‘As outlined in our Interim results to end of September, this is a year of significant strategic, structural and operational change, requiring investment in many areas.
‘We continue to make good progress on our key strategic initiatives and look forward to a return to profitable growth in the next financial year’.
The group added: ‘Our current forecast to year end March 2024 remains on track for year on year growth, and we continue to work on responsibly reducing the excessive, historical, inventory position through the remainder of the year.’
The maker of model trains posted a £5.9million loss for the 12 months ending 31 March 2023, as many consumers reined in discretionary spending.
In June, the group announced it had acquired a 25 per cent stake in Warlord Games, based in Nottingham, for £1.25million.
Hornby will announce its preliminary results for the year ending 31 March 2024 in June.
Founded in 1901 by Liverpudlian businessman Frank Hornby, the company’s model train brands include Jouef, Lima and Electrotran, but it also sells Scalextric car racing sets, Corgi cars and Airfix model planes.
