Model train firm Hornby has issued a profits warning after supply chain problems and softening UK demand hit sales.

The group has been stopped in its tracks by shipment delays from the Far East and a consumer spending slowdown in the UK.

Hornby, which also makes Scalextric model racing car sets, said pre-tax profits for the year to March 31 would come in between £8.75 million and £9 million as a result, compared to market estimates of £9.2 million.

Sales would be £56 million for the year, up 19% on the previous year, but short of previous forecasts, the group added.

Chairman Neil Johnson said he expected the economic environment to remain challenging, but that the business had a strong pipeline of new products for the coming year.

'As a hobby based business, we expect demand for our products to remain resilient,' the group added.

Shares in Hornby fell 7% to 191.5p.