Hmv Group Regulatory News (HMV)

5 Sep 2008 07:00



Interim Management Statement

5 September 2008

HMV Group plc will at today's Annual General Meeting (AGM) issue the following trading update for the 18 weeks ended 30 August 2008

Trading Update - 18 weeks ended 30 August 2008

At the AGM, Simon Fox, HMV Group plc Chief Executive, will comment:

"In what is, undoubtedly, a tough consumer environment, the solid start made by the Group to the new financial year means that our plans are in line with the Board's expectations, and I remain confident that our strategic initiatives are on track. 

"As we approach the peak selling period, our focus is on continuing to provide our customers

with the very best offers, from what is shaping up to be a strong line-up across all product

categories for Christmas."

Trading highlights

Like for like sales growth of 4.3% in HMV UK & Ireland was driven by the strategic initiatives to increase the mix of games and technology, and continued market share gains in all product categories

HMV International's like for like sales growth of 2.9% reflects the rapidly increasing mix of games in HMV Canada (now over 10% of sales) and a further increase in market share across all categories

Excluding the impact last year of Harry Potter and the Deathly Hallows, Waterstone's like for like sales were down 1.7%, reflecting a weaker book market. A well-executed marketing strategy ensured that market share was maintained

Gross margins for the period continued to be well managed and are in line with previous guidance

Operational highlights

HMV UK opened its largest Next Generation store to date (15,000 sq ft) at Liverpool One on 4 September, with a further new opening at Worthing and four refits at Aberdeen, Brighton, Norwich and Southampton. HMV Canada opened or refitted a total of eight stores in the Next Generation format

hmv.com will launch an MP3 digital download and streaming offer later this month 

HMV UK's pilot loyalty card and a pre-played games offer will launch before the end of 2008

Waterstone's loyalty card continues to grow strongly, with 1.8m members

Waterstone's, in an exclusive launch partnership with Sony, launched the Sony e-book reader. The launch, which took place yesterday (4 September), is supported by an exclusive range of e-books on waterstones.com

Waterstone's book hub is on track to commence store supply in September, with Internet fulfilment to follow in October

As required by the Interim Management Statement Provisions, the Group confirms that there has been no significant change in the financial position of the Group in the period since the Preliminary Results to the date of the AGM.

The Group's next trading update will be at the announcement of its Interim results on 11 December 2008.

Notes to table:

1.  Like for like sales growth and total sales growth for the 18 week period are stated at constant exchange rates, being the  weighted average exchange rates for the year ended 26 April 2008 

2. HMV Group's like for like sales performance is calculated at constant exchange rates and measures stores that were  open at the beginning of the previous financial year (i.e. open at the beginning of May 2007) and that have not been  resized, closed or re-sited during that time. It includes sales from Internet sites and is only ever the net amount  received.

3. HMV International comprises the results of HMV Canada, Hong Kong and Singapore. The comparative period has been  adjusted to exclude HMV Japan, which was sold on 25 August 2007

4. Like for like sales growth for Waterstone's and HMV Group plc has been adjusted to exclude from the comparative  period the first eight days sales of Harry Potter and the Deathly Hallows, which was released on 21 July 2007.

Enquiries

** All enquiries on 5 September 2008 should be directed via Brunswick