British music and books retailer HMV Group Plc said on Wednesday it was well set up for the key Christmas trading period as it unveiled an expected first-half loss.
The retailer, which runs Waterstone’s bookstores as well as music shops under its own name, said its pretax loss before exceptional items was 28.7 million pounds ($58.8 million) in the six months to October 27. versus a 29.2 million loss last year.
According to a Reuters poll of six analysts, the company had been expected to report on average a loss of about 27.2 million pounds, with forecasts ranging from 24 million to 30.9 million.
“At this stage, the most important days and weeks of our financial calendar are still ahead of us, and our stores and websites are very well prepared for Christmas,” Chief Executive Simon Fox said in a statement.
“The group’s first half was driven in particular by like for like sales growth in HMV UK & Ireland, where we are successfully exploiting the high growth games and technology categories and increasing our share of music and DVD,” Fox added.
Group like-for-like sales grew 5 percent in the first six months, including growth of 9.2 percent at HMV UK and Ireland and 1.4 percent at Waterstone’s.
This compared with group like-for-like sales growth of 5.8 percent in the first 18 weeks to September 1, which included growth of 9.6 percent at HMV UK and 2.7 percent at Waterstone’s.
Fox told reporters on a conference call that music sales had been boosted by records from Leona Lewis and Led Zeppelin, while DVD bestsellers had included “The Simpsons Movie”, “The Bourne Ultimatum” and “Transformers”.
The latest Harry Potter bestseller boosted Waterstone’s sales, which otherwise would have been flat, Fox added.
HMV said it would provide an update on current trading, including the key Christmas period, on January 17.
“In all, a positive update, albeit largely driven by the strength of the UK games market,” Seymour Pierce analyst Andrew Wade said in a note, reiterating a ‘Hold’ rating on the stock.
Shares in HMV, which have outperformed the UK general retailers’ index .FTASX5370 by around 6 percent so far this year, were unchanged at 117 pence by 0850 GMT, valuing the company at around 454 million pounds.
The company proposed an unchanged interim dividend of 1.8 pence.