Snow derails Christmas for Hornby

TOY maker Hornby warned that its pre-tax profit for the current fiscal would fall short of market expectations, as Christmas sales were hit by bad weather conditions.

Hornby's shares, which have lost nearly 14 per cent over the past three months, were trading down 14 per cent at 118p this morning.

The company, whose founder invented Meccano construction toys in the early 1900s, said the lower-than-expected sales resulted in higher inventories at its retail supply chains.

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Hornby said the supply chain issues it faced last year were continuing to improve, but sales in Europe would not recover ground lost in the first half.

In November, the company had said the fall in its first half pre-tax profit was entirely due to problems at suppliers, but it was seeing a pick-up in demand ahead of Christmas, helped by demand for toys based on the film "Toy Story 3".

Harsh weather and higher inflation combined to give British retailers their worst December on record, reinforcing signs that UK growth slowed sharply in the last three months of 2010.

The company, which is designing merchandise associated with the 2012 London Olympics, said lower sales forced its retailers to reduce restocking orders in the remaining weeks of the current fiscal.

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