LONDON - Music and books chain HMV's Ottakar’s bid may have been the headline for most of last month, but the takeover was far from the mind as it reported that the sales in its stores had been affected by the tough conditions prevailing in the UK markets.
Alan Giles, HMV's chief executive also blamed the London bombings for this dismal sales record and said that the sales were hit all over the country and not just in the capital city. "The effects of terrorism were by no means confined to central London ... We have also seen a substantial effect in other major city centres," he said.
HMV's flagship Waterstone's chain of bookshops was also affected in this slowdown as the group reported that like-for-like sales had dropped 4.4 percent for the 21 weeks since May 1. Same-store sales at HMV UK & Ireland registered a 9.2 percent dip, but HMV Canada and HMV Asia Pacific sales, which were up 7.7 percent and 6.6 percent respectively, gave some cause for cheer. These figures underline the difficulty that UK retailers are facing since the world markets are surging, while the domestic front is quite. The total sales at Waterstone's fell by 4.6 percent with same-store sales dropping by 6.4 percent. "Conditions for high street retailing in the UK have been tough during our financial year to date, and there are few signs of an improvement," said the HMV chairman David Kappler in a statement.
HMV has now turned its attention to Christmas and hopes that Robbie Williams and Franz Ferdinand would boost music sales and Star Wars: Episode III - Revenge of the Sith and War of the Worlds do the same for DVD sales. "The British consumer has come out for the previous 30 Christmases so I've got no reason to believe that they won't come out for the 31st," said Mr. Giles expressing hope that Christmas would turnaround the group's flagging sales.
Mr. Kappler said that the £96 million offer for Ottakar's would result in a "stronger and more efficient book business, which will present a more attractive case for investment in the expansion of the combined business and, therefore, the UK book market."
Posted
on : Thu, 29 Sep 2005 00:05 GMT | Business News
By : Mark Richardson
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