Friday 21 February 2020 7:59 am

Hornby eyes £15m raise for 'solid foundation'

Model train maker Hornby is seeking to raise £15m today as it seeks a “solid foundation” to build on with brands like Airfix and Scalextric.

It will do that by issuing almost 42m new shares at 36p each, with chief executive Lyndon Davies saying: “The strengthening of our balance sheet provides a solid foundation for the next steps in our journey.”

Lyndon, who said the company was in “chaos” when he took over in 2017, added: “There is momentum at Hornby. A lot has changed over the last two years and we continue to make good progress.

“We have a bold vision. We will take advantage of technology within our products and how we engage with our customers. We will fully harness the energy of the broad range brands we own. 

“These are some of the most powerful brands that exist in the markets in which we operate. They have history, heritage and an exciting future. This fundraise provides us with the means to take steps towards fully realising their great potential.”

Liberum Capital will lead today’s book building process as sole bookrunner.

Hornby narrowed losses to £2.7m in the first half of its financial year as it stopped discounting to focus on full price sales, it reported last November.

Meanwhile group revenue rose 15 per cent, but building up Christmas stock saw net debt soar more than fourfold to £8.4m.