HMV losses widen as it considers sale of live music business
HMV saw like-for-like sales fall 11.6% in the half year to 29 October. The struggling entertainment retailer made an underlying pre-tax loss of £36.4 million compared to a loss of £27.4 million in the same period last year.
Total sales fell 17.6% in the period to £364.9 million.
The group said like-for-like sales had fallen particularly sharply in the seven weeks to 17 December, down 13.2%.
Hit badly by the trend for downloading music instead of buying CDs, HMV has shifted its focus to selling more technology products in 147 specially extended stores. The retailer said the strategy was beginning to pay off with sales up 42% in the refitted stores.
The group confirmed that it was maintaining "constructive discussions" with its banks amid reports by the Guardian this weekend that suppliers are harbouring doubts about the group's viability.
HMV also said it had initiated a strategic review of live music business HMV Live which may lead to its sale, the proceeds of which would be used to strengthen the financial position of the group. Earlier this year, the group sold the Waterstones bookshop chain for £53 million.
Commenting on the results, CEO, Simon Fox, said: "This has been a challenging start to the year. However, we have taken decisive action to restructure the business and are now seeing the benefits of this, particularly in our Technology products business. Like all consumer-facing companies we are facing tough trading conditions but we continue to push forwards through this period. We remain well prepared for the key trading days ahead."
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