26 September 2018
("Hornby" or "the Group")
AGM Trading Statement
Hornby Plc, the international models and collectibles group, is today issuing the following trading statement ahead of the Group's Annual General Meeting.
Trading and Outlook
For the period from 1 April to 31 August; sales have been lower than both internal budgets and prior year performance due to a lack of discounting, an excess of stock in the supply chain from the previous strategy and late deliveries due to orders being placed late last year.
However, the discontinuation of discounting has improved gross margins. In addition, as outlined in the Annual report, our focus on frugality and doing more with less has resulted in a smaller operating loss compared with last year, despite the lower than expected sales performance.
The balance sheet also remains strong. As of the 31 August, the Group was in a net cash position.
The line plans for next year are complete, 6 months ahead of last year. This will help to get more product to market in time and in full for 2019. This pipeline of products includes some very exciting releases in both the toy and hobby spaces combined with excellent licensing deals such as the Warner Bros one announced last week.
The outcome for the full year is subject to the sales rate over the key Christmas trading period as we rebuild trust and excess stock starts to clear in retail stock rooms. Our ability to receive products in time as we repair our supply chain is also a factor that will influence the rest of the year.
As it currently stands, the trading outlook is in line with the Board's expectations.
Lyndon Davies, CEO, commented: "Much has changed at Hornby over the last 12 months. The business is leaner and the improvement to our planning horizons are well advanced. More detail will be disclosed on the progress being made when the Group announces its interim results for the half year to 30 September in mid-November."
Lyndon Davies, CEO 01843 233 500
Andrew Godber 020 3100 2222
Capital Access Group
Scott Fulton 020 3763 3400
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