HMV sales boosted by Harry Potter and wet weather

HMV Group, the music and books retailer, has announced that the wet summer weather and the latest Harry Potter best-seller have boosted sales.

The group, which runs Waterstone’s bookstores as well as music shops under its own name, said that the summer showers had boosted DVD sales which has led to strong trading leaving the business in a strong position and they expect to approach the key Christmas trading period in good operational shape.

The Chairman of HMV said in a trading update that the group has had a good start to the current financial year with good momentum in sales, margins and cost management.

The company said like-for-like group sales were up 5.8% in the 18 week period to 1st September, which compares with sales growth of 3.8% in the first 8 weeks.

In spite of the above, Numis, the investment banking and stockbroking business, believes that HMV is still a business in structural decline and in their opinion, the new initiatives are not enough to counterbalance the forces of deteriorating markets in both DVDs and music. Numis concluded that HMV are faced with increased competition from both online retailers and supermarkets. It kept its 80p price target on the stock.

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