HMV 300
HMV admitted it is facing a battle to meet a test on its bank covenants in April, which is linked to its rental bill.
But the group said HMV was still confident over its long-term future, and believed the cost-cutting measures would help it meet the bank covenant test.
Shares plummeted 24% after the company warned that profits for the year to April would be near the bottom of the current range of City forecasts of between £46m and £60m.
Faced with competition from supermarkets in its core CD and DVD markets, the group has branched into new areas like technology sales, recently including Apple’s iPad, as well as entertainment-related products. It has also pushed into fashion, mobile phones and Blu-ray discs, while its swoop for festivals and gig venue owner MAMA Group cemented its position in the fast-growing live market.
HMV said its turnaround strategy was working, with strong sales in its live music division and technology products which were up 20% in the period. Waterstones sales fell 0.4%.
