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Hornby into the fast lane with Lewis Hamilton; TOYS.

The 'Lewis Hamilton effect' helped boost sales of Hornby's range of Scalextric slotcar and digital Formula 1 racing car sets by 23 per cent last year - and with the driver currently leading this year's F1 championships, the group is confident it will see demand build ahead of the all-important Christmas selling season.

"His return to form has generated a lot of interest. If he wins the title this year, it will be good for sales," said Hornby's chief executive, Frank Martin.

He expects Scalextric sets to be a big seller this Christmas.

Apart from Formula 1, the group has just signed a licensing agreement for a new range of James Bond-themed Scalextric sets based on the new Quantum of Solace movie. It features James Bond's famous Aston Martin DBS and the Alfa Romeo chase car. "We've got an exciting range of products in the pipeline that will be ready in time for Christmas. Despite talk of a slowdown in consumer spending, we've seen no evidence of it in our forward orders so far. Our order intake in the UK is currently well into double-digits and the feedback we've had from retailers has been positive," he added.

He was speaking after the release of Hornby's preliminary results for the year to end-March 2008. These showed a 3.7 per cent increase in underlying pretax profits to pounds 8.4 million on total sales 19 per cent ahead at pounds 55.7 million, broadly in line with market expectations.

"We had a cracking year in the UK, helped by buoyant sales of Scalextric. The continuing shift to our new digital formats for both Scalextric and Hornby trains is driving a higher return on sales," Mr Martin said.

Total UK sales rose by 17 per cent to pounds 40.4 million last year, while underlying pretax profits increased by 1.3 per cent to pounds 7.7 million.

The figures also included a first full contribution from Airfix - bought in November 2006 - and Humbrol, the model paints business. "These two businesses have been fully integrated and are performing well ahead of expectations," said Mr Martin.

Airfix generated turnover of pounds 5 million last year and Mr Martin expects sales to move towards the pounds 7 million mark in 2008-09.

In Europe, a major focus for the group moving forward, sales were held back in the latter part of the year as supply chain problems delayed new products from reaching the market.

"This has now been rectified," said Mr Martin. "It was partly a timing issue and sales lost in the closing months of last year will now fall into 2008-09.

"Demand for models and collectables is extremely high in Europe and we're confident that sales and profits here will continue to grow,' he added.

The group is planning a major re-launch for the iconic Corgi Classics die-cast models business next year. Hornby bought the Corgi Classics business for pounds 7.5 million last month and plans to restore sales to their historical high levels.

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Hornby chief executive Frank Martin. Results showed a 3.7 per cent increase in underlying pretax profits to pounds 8.4 million and a 19 per cent sales increase to the end of March
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Title Annotation:Business
Publication:The Birmingham Post (England)
Date:Jun 7, 2008
Words:537
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