Hornby (Airfix) in trouble ?

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Airframes

Airframes

Benevolens Magister
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12,577
Aug 24, 2008
Cheshire, UK
After announcing a fall in sales, and a fall in pre-tax profits of between £5.5 to £6 million, shares in Hornby fell today by 62 % !!!
Hornby Group, famous for model railway products, also own the Airfix, Humbrol and Scalextricks brands, the former two the subject of a number of take-overs in recent years, since being divested from Borden Group.
The announcement, on BBC News, doesn't clarify which part of the group is making the loss, although I suspect it might be the traditional Hornby railway brand, and company bosses have blamed part of the fall is due to poblems with suppliers in China, and also stated they are confident that things will improve.
Let's hope they do, or the new lines of Airfix kits could become history, along with the brand, although I suspect the latter would be snapped-up by another model manufacturer, based outside of the UK.
 
Well I'm hoping Airfix will survive Jim, especially after the obvious hard work in turning round the company, and the investment in re-tooling and some superb, new tool kits.
The company is the same age a me, and we sort of 'grew up together' !
I don't know much about model railway products these days, although as a kid I had a lot of Hornby stuff, but to me, the prices seem exceptionally high for what is on offer, and more so considering most items are plastic these days, instead of the die-cast metal of yesteryear.
How the Hornby prices compare to other model railway brands, I don't know, but the problem is that companies are in the hands of the banking industry - a small loss can mean the winding-up of a company, or at best, selling-off of some brands, even if there are very strong and realistic recovery plans. The banks want their investments back, and if they can't get them, they take the company !
Keeping my fingers crossed that all turns out well eventually - meanwhile, i'll grab the new 1/48th scale Defiant whilst I can !
 
buffnut453 said:
Grab a couple for me, too, Tony. It may be a while before we see any Daffies on this side o' t' Pond.
Click to expand...

1.jpg


Geo
 
Some have gone for silly prices, and not just their older kits. Ask Karl about trying to get a Buccaneer !
 
I agree Wayne.
Of course, the fairly brief News report paints a dull picture, and things might not be as bad as they seem - although a 62% drop in share prices is not to be shrugged off easily.
But if things do go t*ts up, then with the Airfix brand name and products being so well established, and especially with their latest releases, I'm sure a buyer will emerge to continue the brand.
 
Yeah, we raised enough cash to buy half a frame in which to place a photo of a B-25 !

I'm guessing you're probably right Jan.
Hornby have produced model railway stuff for almost a century, but it's always been British only, and nothing wrong with that.
But from what I've seen of the current prices, compared to other , 'foreign', manufacturers, they seem quite expensive, in relation to years passed, and their market might be limited to the UK only, whereas many other manufacturers are in HO gauge, with an International market. It's also highly likely that most (Hornby) manufacturing is done outside of the UK, which is not always the most economical solution in the long term, as it may have been not many years ago, when packaging, shipping and import costs are taken into account,
Now although there's been a drop in profits, that doesn't necessarily mean there's been no profits - but from a bankers / financier's point of view, that could be irrelevant. It's the fall in profit which counts, and if the numbers don't add up to the pre-forecast profits, it could mean trouble, regardless if a company is still achieving sales, and making a profit.
It may well be that their other brand lines, especially Airfix, and probably the Scalextricks slot-cars, are reaching or exceeding forecasted sales, and profitable, but it's the overall profit which will effect any outcome.
Any fall in sales of Airfix lines, which I expect did happen at one stage, partly due to their re- releasing 1950's kits at 21st century prices, I would think would have recovered since the launch of re-tooled, and new kits, which we know have been excellent, although this will have taken time, and will still have 'lost' at least a small percentage of 'traditional' customer base.
It also wouldn't surprise me if sales of 'Humbrol' paints are down, given the inconsistency, and in many cases, poor quality, of the range over the last few years of changes of manufacturing source(s).
Whatever the outcome, I think it's doubtful that any of the brands, including Hornby railways, will disappear totally - there'll be another company, or companies, which I think would 'buy up' at least the stronger 'areas', perhaps selectively, and market them, either under existing brand names, or their own label, after reorganisation to ensure a more 'efficient' return on investment.
It's apparent from the various 'newsletters', announcements and so on, released by Airfix, that this side of the business, at least, is being taken very seriously, and obvious that much time, investment and effort has been, and is being, expended on research, design and tooling for new kits, such as the Meteor and Defiant. However, there have still been a few errors, relatively minor I'll admit, that have resulted in a kit being very good, rather than exceptionally good, and these seem to be the result of perhaps not quite getting initial research totally right, by following-up any slightly 'doubtful' areas with relevant questions at the source of the information. Some of this, I admit, is understandable, as it may well be that the relevant researchers / designers may be excellent in their assigned role, but might not have the extensive subject knowledge needed to identify subtle detail areas which may be in doubt.
That said, the recent releases of new kits have been and are, good value for money, especially when compared to some other manufacturers prices, although I have noticed a couple which have caused me to raise an eyebrow.

Whatever the outcome, let's hope that the company survives intact, with all its brands, even if just to see what is virtually a British 'institution' remain so, and for many years to come.
 
Airframes said:
Yeah, we raised enough cash to buy half a frame in which to place a photo of a B-25 !

I'm guessing you're probably right Jan.
Hornby have produced model railway stuff for almost a century, but it's always been British only, and nothing wrong with that.
Click to expand...

True indeed old chap, always had a wee soft spot for the pre-48, pre BR era....
 
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