Shares in Hornby (LON:HRN) built up a head of steam as investors hoped the group would get back on track following the departure of its chief executive.
The stock raced ahead 26.5% to 31p after the Kent-based company said Richard Ames, who took up his role in February 2014, was leaving immediately.
Chairman Roger Canham will lead the group for the foreseeable future in an executive capacity.
Hornby, which also makes Airfix model kits and Scalextric slot cars, warned last week that losses would hit £6mln after weak New Year sales offset a good run-up to Christmas.
The trading loss was significantly wider than previously forecast, meaning the group was in danger of breaching banking covenants.
The company has sorted out historical problems in its supply base in China, taking on more suppliers to reduce reliance on any one firm.
It has brought some manufacturing back to the UK, including production of new-style clip-together Airfix kits, and has opened a new distribution hub near Canterbury.
But it has also faced one-off costs from speeding up a reorganisation of its European subsidiaries.
Numis Securities, which has an 'add' recommendation on the stock, increased its 2016 pre-tax loss forecast to £5.8mln from £2mln following last week's update.
Analyst Andrew Wade said: "Despite the clear operational progress being made and strong stable of brands, we move our recommendation 'under review' as the 'causes and consequences' of this poor trading period are reviewed."