Hornby, which is largely famous for manufacturing toy trains, Airfix models and Corgi toy cars, reported a nine per cent drop in underlying profits for the year to March 31.

 

However, with an extremely strong interest in existing and proposed London 2012 ranges, the company have predicted that products linked to the Games should offer a major boost to revenues in the financial years to March 2012 and 2013.

 

The company recently released the first products from this range and professed itself delighted at the initial rate of sales.

 

The agreement to become the official toymaker toy maker to London 2012 Games, which was agreed last summer, follows Hornby’s previous experience of producing toys under license.

 

The company has a deal with Disney/Pixar to make characters for the Toy Story franchise as well as agreements with the McLaren and Mercedes Formula One teams.

 

Frank Martin, the chief executive of Hornby said: "Looking forward, Hornby is in excellent shape.

 

"We have agreed a number of new exciting licenses including collaboration with Disney/Pixar to produce products associated with the new Toy Story 3 movie.

 

"Importantly, we continue to introduce more merchandise associated with the London 2012 Olympic Games.

 

"We expect these product lines to perform well as we get closer to the Games."

 

Prices are set to range from below £5 ($7) for London 2012 Corgi vehicles to more than £100 ($145) for limited edition London 2012 Hornby train sets.

 

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