Hmv Group Regulatory News (HMV)

28 Sep 2006 07:02

HMV Group PLC28 September 2006 28 September 2006 HMV Group plc Annual General Meeting and Trading Update HMV Group plc will today issue the following trading update at its annualgeneral meeting ('AGM'). Total Group sales were up 9.5% for the 12 weeks ended 23 September 2006,including the benefit of the acquisition of Ottakar's. Excluding Ottakar's,total sales showed an improved trend on the Group's previous disclosure,declining by 0.6% in the 12-week period, including like for like sales down3.7%. At HMV UK & Ireland, total sales were down 1.2% over the same 12-week period,including like for like sales down by 5.4%, compared to a decline of 16.7% likefor like for the first nine weeks already reported. In an extremely difficultmarket, more competitive pricing in our stores drove the improved performancecompared to the previous nine weeks of the new financial year, and year on yeargrowth of market share in both music and DVD. In hmv.co.uk, sales growth hasaccelerated to over 150% compared to the prior year. Gross margins are, aspreviously indicated, down by 250 basis points. HMV UK launched new simplified, lower prices nationally on 6 September,supported by a high-profile advertising campaign, which will continue throughthe autumn to provide HMV UK with a strong competitive platform going into thecrucial Christmas trading period. HMV UK is also today launching hmvdigital.com,an enhancement to its existing digital downloading service, which enablesconsumers to download music and, eventually, video without the need to installany additional software. In Waterstone's, total sales were down 3.6% during the 12-week period, includinglike for like sales down by 3.0%, compared to a decline of 6.1% like for likefor the first nine weeks already reported. Gross margin was down 70 basispoints, reflecting a more promotional book market. We are making excellent progress on the integration of Ottakar's. To date, morethan 70 Ottakar's stores have been successfully converted to Waterstone's, andthe remainder will be completed on schedule by early November. The consolidationof Ottakar's three head offices and integration of the two teams remains oncourse for completion prior to Christmas. Key elements of the Ottakar's businessare also being exported into Waterstone's, including a highly developed Intranetfor sharing product knowledge between the stores and head office, and manyOttakar's managers now have key roles within the enlarged business. Waterstone's is today announcing the consumer launch of waterstones.com, whichhas been trading successfully since a soft launch in early September. Thewebsite offers a choice of over 2 million titles, with free delivery on ordersover £15 and extensive functionality, including 'Ask A Bookseller' for personale-mail recommendations. In our international businesses, total sales at constant exchange rates in HMVAsia grew by 0.7% in the last 12 weeks, including like for like sales down 1.5%.In HMV Canada, total sales at constant exchange rates grew by 7.3%, inclusive oflike for like sales down 1.0%. Simon Fox joined the Group on 4 September and succeeds Alan Giles as the Group'sChief Executive following the AGM. At the AGM, Carl Symon, HMV Group plc Chairman, will comment: "The markets in which the Group operates, particularly music, continue toexperience very difficult trading conditions. However, I am pleased to reportthat we are exactly on track with the implementation of the strategicinitiatives which we outlined earlier this year. These include integratingOttakar's within Waterstone's, simplified, lower prices in HMV UK and ramping upour online channels, with which we have taken our first major steps to becominga truly integrated, multi-channel retailer." The Group's next trading update will coincide with the release of interimresults on 11 January 2006, and will cover the Christmas trading period. Enquiries: Alan Giles, Chief Executive Susan GilchristNeil Bright, Finance Director Alex TweedPaul Barker, Head of Corporate CommunicationsHMV Group plc Brunswick Group01628 818 355 020 7404 5959 Total Sales Growth Constant Exchange Rates Actual Exchange Rates Weeks 1 to 9 Weeks 10 to Year to Date Year to Date Growth % 21 Growth % Growth % Growth %HMVUK & Ireland (12.1) (1.2) (6.1) (6.1)Asia 0.8 0.7 0.8 (4.1)Canada 6.4 7.3 6.9 6.9Total HMV (7.0) 0.4 (2.8) (3.9)Waterstone's (6.4) (3.6) (4.8) (4.8)HMV Group (6.9) (0.6) (3.3) (4.1)HMV Group (inc (6.9) 9.5 2.5 1.7Ottakar's) Like for Like Sales Growth Weeks 1 to 9 Weeks 10 to Year to Date Growth % 21 Growth % Growth %HMVUK & Ireland (16.7) (5.4) (10.5)Asia 1.4 (1.5) (0.2)Canada (2.4) (1.0) (1.6)Total HMV (11.2) (4.0) (7.2)Waterstone's (6.1) (3.0) (4.1)HMV Group (10.1) (3.7) (6.4) Weeks 1 to 9 covers the period 30 April 2006 to 1 July 2006. Weeks 10 to 21 covers the period 2 July 2006 to 23 September 2006. Year to date covers the 21 weeks ended 23 September 2006. Total sales growth and like for like sales growth at constant exchange rates aretranslated at the weighted average exchange rates for the 52 weeks ended 29April 2006. Total sales growth at actual exchange rates is translated at theweighted average rates for the 21 weeks ended 23 September 2006 and the 52 weeksended 29 April 2006. Waterstone's sales growth excludes the results of Ottakar's, acquired on 3 July2006. HMV Asia excludes HMV Australia, disposed of on 28 September 2005. This information is provided by RNS The company news service from the London Stock Exchange