The company, which is more than 100 years old, said sales have fallen in recent months, with group sales over the first three months of the year 8% lower than the same quarter a year ago
Hornby, the model train manufacturer, has reported that its sales have been impacted by shipping delays in the Red Sea.
The Margate-based company, which specialises in toys and collectibles and has been in business for over a century, has seen a drop in sales in recent months. It revealed that group sales for the first quarter of the year were 8% lower than the same period last year.
This decline was partly due to delivery delays in the Red Sea, with some container ships’ movements being postponed from March to April. Ongoing attacks on key trade routes in the Suez Canal have disrupted international shipping, forcing some container ships to change their routes and increasing freight costs.
Iran-backed Houthi rebels, who claim their attacks are a show of solidarity with Palestinians in Gaza amid the Israel-Hamas conflict, are behind these disruptions. Other retailers such as Pepco Group, the owner of Poundland, and fashion retailer Next have also reported increased freight charges and delays due to the unrest in the Middle East.
Hornby also attributed its lower sales to an earlier Easter this year, which affected year-on-year comparisons. Despite these challenges, the company’s sales for the year ending in March reached £56million, slightly higher than the previous year, driven by a nearly one-fifth increase in direct-to-consumer sales.
The firm admitted to operating at a loss as the year closed, with net debts almost £10million higher than at March’s end in 2023. Yet, they’re optimistic about a sales uptick, aiming for new clientele and fresh product lines.
“We do, however, remain cautious in our outlook due to the natural challenges facing a business in turnaround, and the uncertainty of the wider economic and socio-political factors affecting all businesses at this time,” the company said. This news emerges against a backdrop of industry-wide strain, highlighted by Hattons Model Railways from Widnes announcing its closure after 77 years at the year’s outset.