HMV profits from demise of rivals Zavvi and Woolworths

Music and games sales rise but Waterstone's struggles

The entertainment retail group HMV has vowed to drive home its market-leading position this year after the collapse of its rivals, as it posted robust annual profits and sales growth.

HMV, which runs the eponymous chain and the bookseller Waterstone's, benefited not only by grabbing sales from now defunct retailers, such as Woolworths, but also by acquiring 25 stores from Zavvi, another failed rival. HMV UK & Ireland's performance was further boosted by a surge in sales of computer games and resilient music sales, but Waterstone's continued to endure tough trading on the high street.

Simon Fox, the chief executive of HMV, said: "We are working hard to maximise the market share opportunity that has arisen from the withdrawal of competitors." The group trumpeted a 11.5 per cent rise in pre-tax profits, before exceptional items, to £63m for the year to 25 April, and analysts believe the demise of its rivals will give its figures another shot in the arm this year.

John Stevenson, an analyst at KBC Peel Hunt, said: "For the coming year, we believe the group can deliver material sales and profits benefits from the collapse of Woolworths and Zavvi, noting the sales transfer is in line with forecasts at this time." Mr Stevenson said Woolworths and Zavvi had annual entertainment sales of about £800m.

The entertainment retailer's robust trading demonstrates how some retailers are prospering from the demise of rivals during the downturn, although HMV has recently moved to diversify its operations into the live music market through a joint venture with Mama Group, as well as strategic partnerships with Curzon for cinemas and Orange for mobile phone concessions in its stores, which it will start rolling out this week.

For the year to 25 April, HMV UK & Ireland posted like-for-like sales up by 1.9 per cent. The retailer added that sales of game and technology sales now account for 24 per cent of total sales – boosted by sales of Grand Theft Auto last year – up from 14 per cent at the beginning of its three-year plan in April 2007. HMV said that its unit sales of music grew by 5 per cent, outperforming the broader UK market, where volumes declined by 3 per cent. HMV's total sales jumped by 4.4 per cent to £1.96bn, and group like-for-like sales declined by 0.4 per cent. However, underlying sales at Waterstone's fell by 3.8 per cent over the year, in a declining book market. But Mr Fox said that publishers were feeling more bullish about the year ahead, citing a strong pipeline of books from the autumn onwards, including Dan Brown's new novel in September.

Like-for-like sales at the group's international division, which includes 129 HMV stores in Canada, fell by 3.4 per cent. HMV will pay a final dividend of 5.6p, making its total dividend unchanged at 7.4p.

Sales of Michael Jackson albums outstrip Elvis and Lennon

HMV has revealed that sales of Michael Jackson's albums have rocketed since his death last week and have even surpassed posthumous sales of John Lennon and Elvis tracks.

Simon Fox, chief executive of HMV, said the retailer sold 50,000 Jackson albums last Friday and Saturday – an 80-fold increase. He said HMV had looked back at previous sales following the death of Elvis and the former Beatles star and Jackson's fans had bought "considerably more".

He added: "We were overwhelmed on Friday by customers coming in store and online."

The death of the King of Pop catapulted his Number Ones album to the top spot in the UK charts on Sunday, up from a 121st ranking the week before. The best-selling single download on hmv.com is his 1988 hit "Man in the Mirror".

HMV had been building up stocks of his albums ahead of Jackson's tour of London this summer, but had been "overwhelmed" by demand on Friday.

Mr Fox said: "We are out of stock in many stores. We are replenishing fast and we are hoping to have stock back in today."

Staff in HMV's flagship store on Oxford Street in London said the CDs on sale were the only ones remaining, although they said more were on order.

Fans have created a temporary shrine to the singer outside HMV's store in the Trocadero in central London.

James Thompson and Helena Nathan-King

Start your day with The Independent, sign up for daily news emails
Life and Style
Steve Shaw shows Kate how to get wet behind the ears and how to align her neck
healthSteven Shaw - the 'Buddha of Breaststroke' - applies Alexander Technique to the watery sport
Arts and Entertainment
The sight of a bucking bronco in the shape of a pink penis was too much for Hollywood actor and gay rights supporter Martin Sheen, prompting him to boycott a scene in the TV series Grace and Frankie
tv
Sport
footballShirt then goes on sale on Gumtree
Voices
Terry Sue-Patt as Benny in the BBC children’s soap ‘Grange Hill’
voicesGrace Dent on Grange Hill and Terry Sue-Patt
Arts and Entertainment
Performers drink tea at the Glastonbury festival in 2010
music
Arts and Entertainment
Twin Peaks stars Joan Chen, Michael Ontkean, Kyle Maclachlan and Piper Laurie
tvName confirmed for third series
Sport
Cameron Jerome
footballCanaries beat Boro to gain promotion to the Premier League
Arts and Entertainment
art
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Neil Pavier: Management Accountant

£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...

Sheridan Maine: Commercial Accountant

£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...

Laura Norton: Project Accountant

£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...

Day In a Page

Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine