January 26 2015 Latest news:
Wednesday, January 5, 2011
UK: Music chain HMV - which has severl branches in the region - today announced it is to close 60 of its 400 stores after reporting dismal sales figures.
STAFF at retail group HMV were left facing an uncertain future today as the troubled firm announced plans to close 60 stores across the UK over the next 12 months.
The news came as HMV delivered a dismal set of Christmas sales figures after its peak trading season was “significantly undermined” by severe weather.
HMV, which also owns the Waterstone’s chain of book shops, warned that profits for the year to April were set to be near the bottom of the current range of City forecasts, of between £46million and £60m.
The group reported a 13.6% slump in HMV’s like-for-like sales in UK and Ireland in the five weeks to January 1, although Waterstone’s improved on its recent performances with a like-for-like fall of just 0.4% for the same period.
Around 40 HMV stores are expected to be closed together with about 20 Waterstone’s branches, but no details of the locations have been confirmed.
The HMV network includes town centre branches in Ipswich, Bury St Edmunds, Colchester and Chelmsford, and shops at Stansted Airport and the Freeport Braintree shopping village.
Waterstone’s has two stores in Bury St Edmunds (one in the Buttermarket and the other within the Arc shopping centre), two Colchester (one in the town centre and the other on the University of Essex campus), and one each in Ipswich, Lowestoft and Chelmsford.
Fiona Allen, a spokeswoman for Waterstone’s, said it was too early to give any indication as to which of its stores may be affected, adding that no assumption should be made that because there were two stores in Bury one would close.
Gennaro Castaldo, head of press and PR at HMV UK and Ireland, said the stores to be closed were “likely to be located primarily in large-city conurbations and may be in close proximity to each other, thus resulting in a degree of duplication in relation to local demand, which is not really the case in Suffolk and Essex”.
He added: “This move in no way signals any intention to pull out of entertainment retail, which remains at the heart of our offer, and is ultimately aimed at safeguarding our core business as we continue our transformation into a broad-based entertainment brand that now also encompasses live music venues and festivals.”
In its trading update today, HMV said that as well as disruption caused by snow and ice before Christmas, its core entertainment markets remained weak, underlining the urgency of its turnaround strategy.
Faced with competition from supermarkets in the CD and DVD markets, HMV has branched into new areas such as 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.