World Cup hits sales at HMV

Total sales fell 13.9% in the 19 weeks to September 4 but the retailer reassured that its market share remains “satisfactory in music and games, with some dilution in video due to competitor discounting”.

At the group’s book chain, Waterstone’s, like-for-likes dropped 2.6% and total sales slipped 1.6%. The retailer said there had been an “improved market share performance at Waterstone’s” in the period, when ebook sales climbed 73% year-on-year.

Group like-for-likes decreased 10.6% and total sales declined 5.9%, including the contribution of its Live arm. Excluding that, total sales dropped 9.9%.

Group chief executive Simon Fox said: “As was highlighted with the preliminary results, trading during the first quarter has been difficult, particularly in HMV UK & Ireland, where the World Cup disrupted the pipeline for new entertainment product, and the games market continued to be weak.

“In line with our new strategic plan, over the summer we progressed the changes to our stores that will enable us to drive our new fashion and enhanced technology offers. These initiatives, combined with a stronger product line-up, particularly in games, are key to the delivery of a successful Christmas.”

The retailer said gross margins “remain well managed and in line with previous guidance”.

HMV group finance director Neil Bright is step down in December to join travel firm Holidaybreak in the same position. The search for his replacement has begun.

The retailer said its live venues are “performing in line with expectations” and like-for-like sales at wholly-owned venues up by 8%.

However the music festivals business performed below expectations because of a disappointing attendance at the High Voltage event.

Fox said: “We continue to make good progress on all three parts of our strategy, including the turnaround of Waterstone’s, where the initiatives to strengthen our specialist positioning, localise our store offer and revitalise our market leading brand have had a positive impact on trading.

“Overall our plans for the peak trading period are in good shape, and our focus is on providing our customers with the best offers across all product categories and live venues.”