Hornby revs up sales amid nostalgia for Airfix kits and toy cars

Playing with model cars may be a feature of many a nostalgic childhood memory, but the retro toys are enjoying a revival - with classic toy firms thankful for the boost.

Hornby reported a 17 per cent jump in profits to £9 million for last year.

Sales were 19 per cent up at £55.7 million - and the firm hopes to further increase profits from the recent acquisition of Corgi cars.

Railways sales grew by around 3 per cent  with the digital Virgin Trains Pendolino the best-selling locomotive.

Chairman Neil Johnson said he was confident of further growth this year despite a slower economy.

'Notwithstanding the general economic downturn in many of the markets in which we operate, we are anticipating another year of good progress,' he said.

Hornby, which already owns Airfix and Scalextric, has bought flailing model car firm Corgi for £7.5 million.

It plans to revamp the model car firm which failed to make profits last year.

Corgi is expected to break even with £7 million of sales in the year to March 2009.

This is a dramatic slump since 1999 when the company enjoyed a £20 million turnover and made £3 million of profits.

To boost sales, the company intends to target children as well as adult collectors.

Plans include launching new models such as Formula One racing cars and agricultural models, according to Hornby chief executive Frank Martin.

Mr Martin said he was confident that Corgi could get back to the days of multi-million unit sales and plan to add £4 million of new revenues within the following three years.

He said: 'Corgi retailers and collectors are delighted that Hornby has taken over.

'We are confident that we will quickly rebuild sales, profits and market share.'

He said the success of the Airfix business, bought in November 2006, showed older brands could be re-invigorated.

Sales of Airfix models were around £5 million in the last financial year, well ahead of the group's £4 million forecast.

'That really demonstrates that long-standing brands if handled correctly have got a lot of life left in them,' Mr Martin said.

Model train sales in the final quarter of the financial year were hit by delays in supplying European subsidiaries.

It resulted in the firm warning investors that full year sales and profits would be lower.