Hornby cheers festive trading boost as it attracts new customers
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Scalextric and model train firm Hornby has revealed a boost to sales after solid Christmas trading as it continues a turnaround with advice from Frasers founder and billionaire Mike Ashley. Hornby said sales lifted 7% in the crucial quarter to December 31, with 23% revenue growth for December alone.
It cheered strong trade from first-time customers as its direct-to-consumer sales pick up pace, with the group seeing nearly half of all Black Friday sales from new customers, up from 42% a year earlier. We are continuing to drive down the inventory levels that had built up in recent years and are delivering our change plans in a steady and sustainable way.
The Margate-based company said the strong festive performance has helped overall group sales lift by 8% in the financial year to date, with gross profits 10% higher. Shares lifted 6% in Wednesday morning trading. The firm said in March that Mr Ashley would advise Hornby after building up an 8.9% stake in the model train specialist, becoming its third largest shareholder.
The toy company said the retail tycoon “entered into a consultancy arrangement” as it sought a financial turnaround. It is hoped the move can help spark a financial turnaround at Hornby after it had seen losses mount. Shares in the company slipped to their lowest price for decades at the end of 2023 as a result.
On Wednesday, Hornby said its turnaround plan was “very much on track”, confirming that it remains on course for growth in the year to March 31. Chief executive Olly Raeburn said: “In a tough economic climate, we are pleased to be able to report growth in revenue, margins and gross profits through this critical quarter.
