HMV, which owns 49 per cent of Daisy & Tom, has written off the value of its stake little more than a year after the chain was valued at pounds 12m. The write-off resulted in a pounds 7.7m exceptional charge in HMV's first full- year accounts.
Daisy & Tom was set up by Mr Waterstone with a single store on London's King's Road and named after his daughter and the son of his business partner. It became part of HMV Media last year when venture capital funds backed the buy-out of HMV and Waterstone's. But since then only one other store, in Manchester, has been opened and the trading losses mean management will concentrate on existing stores before expanding.
HMV Media's first full-year results showed that operating profits before exceptionals rose from pounds 50m to pounds 86m. But heavy financing charges arising from the buyout meant that pre-tax profits were reduced to pounds 15.3m.
The HMV music stores were the star performer with underlying sales up 3.7 per cent in the year to April and 5.1 per cent in current trading. But the Waterstone's bookselling business was flat with underlying sales up 1.5 per cent last year and 0.7 per cent in current trading. Alan Giles, chief executive, said: "The book market has been difficult but Waterstone's has still been outperforming the sector."
The company said it remains on course for a stock market listing though this will not take place until after Christmas at the earliest.Reuse content