[WWI] Hornby - not doing that well

[Scottrik]

I believe the "home" market (UK) is still their largest market.

The weakness of the dollar relative to the GBP is that they've been
investing pretty heavily in developing the American market, but continued
(and increasing, it seems) weakness of the dollar makes pricing/profit a
challenge. Fortunately Scalextric production has been in China a few years
now--moving it there saw AMAZING increases in model detail and quality while
keeping prices in the same mid-$40 range as when cars were produced in
England at Havant(?).

I was a little surprised they closed their "store" in Tacoma (was actually
in Auburn, but wee won't tell...). Then again, I'm a big Scalextric hobbyist
and only visited the site once though it was only a half-hour away from
home. It was a pretty short-lived experiment that I think would have had
better success had it been in a "normal" mall rather than the oddball one
selected.




-----Original Message-----
From: wwi-bounces at wwi-models.org [mailto:wwi-bounces at wwi-models.org]On
Behalf Of Michael Kendix
Sent: Saturday, June 02, 2007 5:50 AM
To: wwi at wwi-models.org
Subject: Re: [WWI] Hornby - not doing that well


Dave:

Thanks for the elaboration and explanation.

Yes, the article said that profits didn't meet expectations, not that they
weren't making profits. Still, I am guessing the market knew of the Airfix
acquisition and dollar drop issues prior to the figures being announced,
hence the drop in share price. Why is the dollar drop a problem?  Is the US
their major market?  If so, obviously I understand. I thought Japan was the
biggest model market.

Michael


>From: dave fleming <dave.fleming at dial.pipex.com>
>Reply-To: World War I Modeling Mailing List <wwi at wwi-models.org>
>To: World War I Modeling Mailing List <wwi at wwi-models.org>
>Subject: Re: [WWI] Hornby - not doing that well
>Date: Sat, 02 Jun 2007 00:44:35 +0100
>
>They got hit by the falling dollar and the unexpected aquisition of Airfix.
>Year on year, perhaps not as strong as expected, but still a hell of a lot
>better long term than before.
>
>Airfix tool making has been sourced from around the world for a while -
>H*wks &
>TSR2 in China, Lifeboat in Portugal, the N*mr*d and C*nB*rr*s are being
>tooled
>by Trumpeter. What Hornby are doing is moving all production to China (The
>paints have been made there for some time) - previously most (but not all)
>was
>done at heller in France. Hull had been a distribution centre only for a
>number
>of years.
>
>Dave

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