HMV, the music, DVD, games and books retailer posted disappointing fourth quarter sales sending its shares down.
The group, which runs over 400 stores under its own name as well as 313 Waterstone’s bookstores, said its like-for-like sales slipped 13.2 per cent in the 16 weeks to 24 April.
Its stock tumbled 8.6 per cent to close at 72p.
However, the retailer insisted it would meet full-year profit forecasts of around £74.5m, with better margins and tight cost control. The retailer added that a strong summer release schedule gave it confidence that sales trends would improve.
“Prospects for the entertainment markets going into the new financial year are more encouraging,” said chief executive Simon Fox.
He said sci-fi epic Avatar, released on Blu-ray and DVD this week, was expected to be one of the biggest selling films of the year, while new releases include Sherlock Holmes, Alice in Wonderland and Toy Story 3.
Fox said the music roster was also strong, with Robbie Williams, Duffy, Cheryl Cole and Amy Winehouse all releasing albums, while in games, this year sees the release of new motion sensor controllers plus related software for the major consoles.
“Until the core HMV business sees some better trading, 2010 and 2011 profit forecasts will edge down and the shares are likely to remain under a cloud,” said Nick Bubb, analyst at Arden Partners.
City A.M. Reporter