Toy firm Hornby warned it was facing a tough Christmas yesterday after disappointing sales of Olympics merchandise left it nursing a half-year loss.
It made £3.5 million on sales of London 2012 goods such as model taxis and buses but margins were weaker than expected and after provisions to cover unsold stock it slid to a £541,000 loss in the six months to September.
The Margate-based firm admitted it was battling against “significant short term challenges” as the Olympics blow added to supply chain woes and poor consumer demand.
UK sales lifted by 3 per cent in the half-year but plunged by 15 per cent with Olympics sales stripped out.
Hornby, which makes model railways, Scalextric racing cars and also owns the Airfix and Corgi brands, said conditions were likely to be weak in the current half year as retailers remain cautious on order intake.