Hornby sales are down after Houthis block Red Sea cargo

Hornby has seen a drop in sales due to delays in deliveries caused by shipping attacks in the Red Sea.

Margate-based model trains and collectibles said that sales fell 8 percent in the final quarter of their financial year, ending March 31, as compared to a year earlier.

The decline in deliveries was partially due to delays. Ships have been attacked by Houthi Rebels and forced to take longer routes. Some container ship schedules have been moved from March to April.

Due to the disruptions in the Middle East, other retailers, such as Pepco Group (which owns Poundland) and Next, have reported higher freight costs and delays.

Hornby attributed the lower figures to Easter being earlier than normal, which affected comparisons between years. Sales for the entire year were only 2 percent higher due to the weak fourth quarter. The net debt increased from £5.5m to £14.3m at the end March.

The company stated that “While we end the year in a losing position, and both our net debt and inventory remain too high,” we have seen an improvement in our trajectory over the past half-year and we aim to continue with this positive trend throughout the entire financial year.

Frank Hornby founded Hornby in 1920, after he patented Meccano toys and created his first clockwork trains. The Aim index lists it and includes Sir Rod Stewart and Pete Waterman as celebrity fans.

Phoenix Asset Management owns 73,4% of the company, while Artemis Investment Group holds 9.7%. Mike Ashley’s Frasers Group is the group’s third-largest shareholder, with an 8.9% stake disclosed in February.

Hornby’s share price closed at 34 1/2p, down by 3 1/2p or 9.2 percent.