Much has been made on the current financial climate that is affecting most of the world, and the retail trade is suffering tough times in what is normally the busiest time of the year. Today we have news that HMV is facing an uncertain future as more assets are considered for sale.
The tech and music retailer has admitted it faces “material uncertainties” after it reported losses of £36.4 million, and according to The Guardian is thinking of selling off some of its assets. These include live venues such as the Hammersmith Apollo as the game and DVD retailer saw sales for the 26 weeks to the end of October fall 17.6 percent.
This resulted in the retailer reporting a bigger loss than the £27.4 million it saw for the same time last year. Sales have continued to fall in the run up to Christmas with some suppliers having doubts about the retailer’s viability, with a reported drop in sales for the seven weeks up to December 17th of 13 percent.
Philip Dorgan retail analyst of Panmure, feels the group is currently “in a very difficult position“, with the coming days really important to stop the financial situation getting worse. This has seen shares lose almost 90 of their value in the last year, and only values the business at £16.4 million now.
The company currently has net debts of £163.7 million with some suggesting a rights issue is needed to keep the retailer trading. HMV has commented that it has enough resources to continue for the “foreseeable future“. It is believed the group’s directors are having ‘constructive’ talks with the group’s banks.
HMV currently has 249 stores with a further nine Fopp outlets, and the HMV Live arm that runs its live venues. But HMV Live could now be sold off to keep the business going and comes after it recently sold off the Waterstone book chain.
Do you still purchase items from HMV?
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