Hornby PLC - Margate, England-based model train maker - Says revenue in the six months to September rose 6.3% to £23.8 million from £22.4 million a year prior due to the an increase in sales direct to consumers. Meanwhile, pretax loss widened to £5.1 million from £2.9 million the year before, as underlying overheads rose 17% to £14.6 million. This is due to an ‘increase in minimum wages, general inflationary increases and increased focus on direct selling routes and e-commerce costs including personnel.’ Looking ahead, Hornby expects full-year profitability to be ‘depressed’ as it restructures the business and makes ‘necessary investments in people and processes.’ Nevertheless, maintains high single digit or low double digit revenue growth guidance for the full-year. Chief Executive Olly Raeburn comments: ‘Whilst topline revenue is growing, and remains in line with management guidance for the full year, there is a cost increase associated with what’s being implemented. We head into the key Christmas trading period with a strong order book, a full calendar of promotional activity and a strong team in place. Whilst we do not expect the full benefits of this year’s initiatives to take effect until the next financial year, I remain excited about the progress being made and look forward to seeing the impact of these changes over the next 12 months.’

Current stock price: 15.04 pence, down 6.0%

12-month change: down 47%

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