Model makers celebrate strong sales but urge caution
Model making retailers Hornby and Games Workshop have reported strong sales in their trading updates, but have warned of uncertainty in the coming year.
Hornby, most famous for their model train sets, announced that sales in the third quarter (October 1 – December 31) were ahead of the same period last year.
The group said that as a result, cumulative group sales for the financial year to date were up by 6%.
Hornby said its direct-to-consumer sales have continued to increase and are 44% ahead of 2021 levels.
“We remain cautious in our outlook for the full year and beyond due to a high level of uncertainty around the impact of several factors on our sales such as inflation and mortgage costs for consumers but with employment expected to remain high we are hopeful that the confidence in consumer spending remains”, the retailer said.
Meanwhile, Games Workshop, which operates the Warhammer figurine brand and associated stores, saw a core growth sales increase in December of 4%, with an increase in retail sales of 9.8% and trade increases of 3.4%, while also recording a small dip in online sales of 0.5%.
However, the group saw a fall in operating profit on a constant currency basis of £5.2m, down to £64.5m. Games Workshop cited a number of reasons which were impacting the delivery of its commercial plan, such as COVID-19, Brexit, and the War in Ukraine, which the retailer claims led to a loss in revenue of around £2m from Russian sales.
Games Workshop also listed a number of board changes which have taken place since its last update, with Randal Casson’s appointment as non-executive director, and the appointment of John Brewis as non-executive chair, with Elaine O’Donnell stepping down.