HMV has stated that despite what it describes as “a very challenging year” for the video games market that saw it decline 25 per cent year-on-year, the retailer has gained market share in the sector – thanks in part to “an increasing contribution” from its pre-owned offer Re/Play.
Overall sales for the HMV Group for the year ending April 24th 2010 grew 3.1 per cent year-on-year to over £2bn, though HMV’s like-for-like sales fell 2.4 per cent. Profit increased 17.7 per cent to £74.2m.
“The Group's full year performance was pleasing, with record sales and a 17.7 per cent increase in profits, driven by a strong performance at HMV UK, as we continue to transform this business into a broad-based entertainment brand,” chief executive Simon Fox stated.
“Whilst at an early stage, the three pillars of our new strategy to continue to evolve HMV's product mix, grow in live and ticketing and turn around Waterstone's are progressing on track, as we continue to position the Group for the changes that are taking place in our markets.”
The retailer claims to have made market share games in every single product category, adding that membership of its PureHMV loyalty card scheme has now passed the 1m member mark.
DVDs and Blu-ray remains the chain’s largest single product category, accounting for 45 per cent of sales. Blu-ray sales in isolation grew 85 per cent year-on-year. Music accounts for 28 per cent of sales, though sales volumes were down 4.9 per cent. Technology, which includes games, accounted for nine per cent of total sales.
HMV’s store base now numbers 285 following the successful acquisition of 32 old Zavvi outlets.
“This year, HMV took maximum advantage of its strength as the only specialist retailer of scale in the UK entertainment market,” chairman Robert Swannell added.
“Despite this, our environment remains highly competitive, with some retail and online competitors prepared to offer many of the same products to their customers at loss-leading prices. Therefore, particularly given these changes taking place in our markets it has been, and will continue to be, necessary for us to rapidly diversify into new and related retail products in a way that the powerful HMV brand allows us to do.