Second train chief resigns

Hornby trains: growing in quality and popularity

Model railway land has mirrored the UK's real train sector in losing its business leader on Friday.

Peter Newey has announced his resignation as chairman of train-set stalwart Hornby, hours before Gerald Corbett quit as chief executive of Railtrack.

Mr Newey, who has overseen the revival of Hornby despite challenges of the strong pound and a revolutionised toy market, said it was time for a new team to lead the firm "into its next stage of development".

The resignation was announced as Hornby revealed profits more than doubled to £524,000 for the six months to the end of September, on turnover of £9.3m.

Factory move

Under Mr Newey's leadership the firm, which also makes Scalextric car racing sets, moved production to China in a drive to reduce manufacturing costs.

"The outsourcing programme has been a major factor in the improvement of the company's performance," Mr Newey said.

The design and build quality of the models was also improved in an effort to attract collectors, and reduce reliance on the younger customers targeted by computer games makers.

This strategy "is leading to particularly strong sales in the model and hobby shop sector", Mr Newey said.

Christmas boom

The firm has been able to reap long term rewards from a sales boom last Christmas and early in the new year, a company statement revealed.

Hornby, which in the spring said it was open to merger offers, last month said it was capable of thriving as an independent.

Mr Newey will be replaced as chairman by Neil Johnson, a former chief executive of the RAC and board director at Jaguar.

Shares in Hornby steamed 26p ahead to 156p in London on Friday.