SALES OF best-selling CDs by Lady Gaga, Adele, Katy Perry and Take That were not enough to prevent the Irish arm of HMV going into the red last year.
Accounts just filed by HMV Ireland Ltd show that the company recorded a pretax loss of €2.5 million in the 53 weeks to the end of April 30th last. This follows a pretax profit of €631,000 the previous year.
The firm went into the red after sales fell 11 per cent to €76.4 million. The loss includes exceptional costs of €1 million relating mostly to the impairment of retail assets, with €50,000 accounted for by redundancy costs relating to non-store employees.
At the end of April last, the Irish arm of the music, video, electronic games and book retailer operated 16 shops here. According to the directors’ report, “the company continues to trade and will continue its existing business for the foreseeable future”.
The accounts show that the company paid €38 million in dividends in fiscal 2010 and that the loss sustained last year further reduced the company’s accumulated profits to €7.2 million. No dividend was paid last year.
Shares in HMV Ireland’s parent, the UK-based HMV, dropped last month after sales fell across its 256-store network by 8 per cent in the Christmas shopping period.
HMV is facing intensive competition from online retailers. The directors of its Irish unit say one of the principal risks and uncertainties is “the growth of new methods of digital delivery”.
The figures show the company’s operating loss before exceptional costs was €1.53 million last year – a sharp deterioration from the €426,000 pre-exceptional operating profit the previous year.
There was a cut of 79 in the number of people working for the company, reducing staff numbers to 293. Directors emoluments for the year declined from €272,000 to €159,000.
