Thursday, 17 January 2008

Profits for HMV

HMV and Waterstone's bucked the trend of gloom on Britain's high street and predicted that full year pre-tax profits would be near the top end of the City's expectations after a glooming Christmas period by a bumper DVD, music and books line-up and strong growth online.

In stark contrast to the profit warnings and senior management departures that accompanied a dire Christmas a year ago, HMV said that like-for-like sales were up 9.4% in the five weeks to January 5 this year. HMV reported that it was the best growth by a long way since floating in 2002.

Chief executive Simon Fox, who has been pushing through an overhaul of the business to try to get to grips with shoppers' growing desire to buy online, said the changes had helped "deliver a highly successful Christmas. The product markets that we operate in have generally been buoyant, it was a very strong Christmas for DVD and for games. We've moved into higher growth areas like technology products."

HMV's shares jumped 14% to 115p in early trading after the company pledged that full-year pre-tax profits would "be towards the upper end of current market expectations"

Within the group, HMV UK & Ireland enjoyed like-for-like sales growth of 14.1% over Christmas. Waterstone's performance was less impressive, with sales at the bookseller up 4% on a like-for-like basis. However, the company's international business, which includes stores in Canada, Hong Kong and Singapore, saw like-for-like sales drop 0.6% over the key Christmas period. Fox said that was largely down to a Canadian rival going bust before Christmas and selling off its stock at clearance prices. (source: The Guardian)

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