With consumer spending still depressed, the firm now expects to break even in the 2012-13 financial year against last year’s profits of £4.5m. Its shares fell more than 40% to 50 pence in the first few minutes of trading.
Hornby gained the licence to sell a range of London 2012 merchandising, including replica mascots and a Scalextric velodrome. This year, the firm said its performance would be ‘constrained significantly’.
It said it would try to find alternative sources of products to try to reduce the disruption created by its Chinese supplier, which is rationalising its manufacturing. This supplier currently represents 35% of Hornby’s purchases, but at its peak had accounted for about 75%.