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8th July 2021

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HMV revenues fall by 40 per cent

Half-year results show impact of restructuring and tough market conditions

The HMV Group has reported a 40 per cent decline in revenue in its half-year financial results.

For the 26-week period ended 29 October 2011, HMV posted £443.3 million in revenues, a 40.8 per cent drop over the same period last year.

The company made a net loss of £40.6 million, up from last year's loss of £37.8 million. It now has underlying debt of £163.7 million.

The drop in revenues is partly due to the sale of Waterstones and HMV Canada, but the report also warns of "material uncertainties" created by the current economic environment that, "may cast significant doubt on the Group's ability to continue as a going concern in the future."

During the 26-week period, HMV also restructured its 144 retail stores to focus more on technology and portable digital products.

"This has been a challenging start to the year. However, we have taken decisive action to restructure the business and are now seeing the benefits of this, particularly in our Technology products business," said CEO Simon Fox in a statement.

"Like all consumer-facing companies we are facing tough trading conditions but we continue to push forwards through this period. We remain well prepared for the key trading days ahead."

Celebrating employer excellence in the video games industry

8th July 2021

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Latest comments (17)

Alex Byrom Studying Multiplayer Online games design, Staffordshire University9 years ago
With Hmv and game in trouble, it looks like entertainment shops on the high street are going to be a thing of the past
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Terence Gage Freelance writer 9 years ago
The outlook really isn't bright for places like HMV. Putting more onus on technology hardware's all well and good, but Best Buy UK have just closed down, and I don't think DSG are doing too well either. When this recession/financial crisis is over I wonder how many national high-street businesses like this will remain...
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They could always be like specialist shop forbidden planet
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Show all comments (17)
Lee Banyard Senior Sound Designer, Rocksteady Studios9 years ago
As they continue to sell secondhand games, I have absolutely no sympathy.
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Colin McBride Studying MA in 3D Design for Virtual Worlds, Glasgow Caledonian University9 years ago
I'll be very surprised if HMV are still extant by the end of 2012. And that's very bad of the High Street. Aside from the very few remaining independent stores, that means there's pretty much nowhere left to browse music and/or film. If Waterstones ends up going the same way then for people like me there will be pretty much no reason to wander into town...
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Geir Aaslid Producer, Virtual Game Worlds As9 years ago
With a declining retail market for games, the answer is to diversify. There are many other forms of entertainment which can be sold to the same customers.
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Neil Young Programmer, Rebellion Developments9 years ago
They need to find themselves a reason for people to walk through their door, and I don't see how that can be games these days - they can't compete with game on staff knowledge, which seems to be bricks and mortar's last card to play, and they can't challenge supermarkets and online sellers on price.
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Graham Flood9 years ago
No HMV type store is bad for the industry as it removes impulse purchasing. Consumers will be much more likely to be more conservative when buying media. I would sorely miss not having a HMV to visit as part of my Saturday trip to city center :-(
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Mark Richardson Independent developer 9 years ago
To be honest HMV are asking for it. This is what happens when you sell games, films and music at notably higher prices than your competitors. Quite often I take a look in HMV, Game and a few other shops and HMV is always the most expensive. They sell games that are months old at the full RRP and wonder why people don't buy from them, while Game on the other hand sell the same games for about 20-30% less.
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Otto Junior Espinoza Studying Bsc Computer Science, Middlesex University9 years ago
Game is expensive as well!!

I have seen games older than 6 month still costing over 30. Unfortunately Amazon type business are the future, HMV and Game can't compete with those prices!
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Andrew Goodchild Studying development, Train2Game9 years ago
"Amazon type business are the future, HMV and Game can't compete with those prices"
And frankly, they don't even, at least in my experience, try to compete with Amazon's customer service. Every one tries to follow Amazon into the online space, but learn no lessons from all the things Amazon get right. When I had a problem with being double charged twice in one order at Game.co.uk, it took 2 x 45 minute call on a customer service line that cost about 20, then took several attempts to sort out, and apparently this has been happening a lot. On the few occasions I've had a problem with Amazon (and it's always been to do with the product, not the Amazon side) I've only had to type in my phone number, and they phone me within 5 seconds, and sort it out.
Amazon's price gain customers, but their competance retains them.
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Tamir Ibrahim Programmer, Splash Damage9 years ago
I have dealt with Amazon customer service on a few occasions and I have to say I have always found them to be above and beyond acceptable and into exceptional. It is for this reason that I love Amazon and buy from them regularly.
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James Verity9 years ago
HMV will always loose, especially when there online price is different to the in store price... doing that just makes HMV look stupid and tells the customer they are being ripped off on the high street... no wonder they are one of the last places people look to make purchases...

why not have an order online and collect in store service... shift some of that stock that is sitting in the shops and not moving (the stuff that even when HMV have a sale, it dosnt budge)...
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Terence Gage Freelance writer 9 years ago
I do like browsing in HMV and like Graham said, I would miss it if they closed down. I bought a couple of DVDs in there at the weekend for Christmas, which were probably the first thing I've bought from them in about three years. Their games prices - both new and pre-owned - do seem vaguely ridiculous.
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Tommy Thompson Studying Artificial Intelligence (PhD), University of Strathclyde9 years ago
@Terence

I don't see it being that great a loss. As you said yourself, those DVDs were the first purchase in their store you've made in three years. If their prices dropped even 10-15% in some instances then they could boost business. Consumers won't be driven to impulse purchases if that 6 month old product is still > 50% rrp.

Conversely, this brings up ye old debate of the value of entertainment and media. Given how quickly the value depreciates when on the (virtual) shelf, are the retailers buying them at too high a price?
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Matthew Hill Head of Recruitment, Specialmove9 years ago
It's easy to criticise HMV, perhaps justly but with Game also facing major challenges there is a real danger that both could vanish from many high street locations - particularly "secondary" locations. Sadly structural changes in the market perhaps makes this increasingly likely.
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Sam Maxted Journalist / Community / Support 9 years ago
I remember a similar discussion on here around this time last year, where the general consensus was that HMV was pricing itself out of the market, even compared to other high street stores. If their upper management still doesn't realise where they're going wrong, there's simply no hope for them.

With that said though, we may see some narrowing of the gap between online and high street stores come April when the Channel Island VAT loophole will be closed, meaning companies like Play and Amazon will need to start paying VAT on items they ship from there. And given the current level of VAT, that's in no way a small price increase.
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