HMV shares plummet following news of upcoming sale

Shares in entertainment retailer HMV plunged 28.80 per cent to 1.10p at 14:04 on Friday afternoon following an announcement that the company would have a sale over the weekend.

Shares in entertainment retailer HMV plunged 28.80 per cent to 1.10p at 14:04 on Friday afternoon following an announcement that the company would have a sale over the weekend.

The news comes less than a month after the company published its interim results disclosing that there was uncertainty as to the level of trading results that could be achieved in the year ahead due in part to the volatility in the group's core music, visual and games markets and current market trading conditions.

A spokesman at HMV, told ShareCast: "We are launching a Blue Cross sale on Saturday across the chain offering a 25% saving on a wide range of titles and products that will run for the remainder of the month."

He added: "It's just a promotional event, not linked to anything else, at a time of year when there are no major releases and we're looking extend even greater value to our customers."

The December interim results stated that HMV's current trading performance was not in line with expectations and that the group was unlikely to achieve previous expectations for the full year.

"The next covenant test date under the banking facility is at the end of January 2013. In light of current trading performance, and market conditions, it is probable that the banking covenants will not be complied with at that time.

"However, the group is currently operating within the terms of its banking facility and the directors continue to maintain regular and constructive discussions with the group's banks," the interim statement continued.

The statement added further: "The directors believe that the group will be able to meet their liabilities as they fall due, including the £30m amortisation payment due in January 2013, and will have adequate resources to continue in operational existence for the foreseeable future."

MF

Recommended

Three top-notch Asian stocks to buy
Share tips

Three top-notch Asian stocks to buy

Professional investors Adrian Lim and Pruksa Iamthongthong, managers of the Asia Dragon Trust, pick three of their favourite Asian stocks to buy now.
23 Sep 2022
Why you should short this satellite broadband company
Trading

Why you should short this satellite broadband company

With an ill-considered business plan, satellite broadband company AST SpaceMobile is doomed to failure, says Matthew Partridge. Here's how to short th…
23 Sep 2022
Share tips of the week – 23 September
Share tips

Share tips of the week – 23 September

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
23 Sep 2022
Momentum investing – and why price matters more than anything else
Investment strategy

Momentum investing – and why price matters more than anything else

The recent fashion for momentum investing, with investors piling into expensive growth stocks, is nothing new, says Merryn Somerset Webb. And the dang…
21 Sep 2022

Most Popular

Beating inflation takes more luck than skill – but are we about to get lucky?
Inflation

Beating inflation takes more luck than skill – but are we about to get lucky?

The US Federal Reserve managed to beat inflation in the 1980s. But much of that was down to pure luck. Thankfully, says Merryn Somerset Webb, the Bank…
26 Sep 2022
Earn 4.1% from the best savings accounts
Savings

Earn 4.1% from the best savings accounts

With inflation topping 10%, your savings won't keep pace with the rising cost of living. But you can at least slow the rate at which your money is los…
27 Sep 2022
The pick of this year's best-performing investment trusts
Investment trusts

The pick of this year's best-performing investment trusts

Market conditions haven’t been easy, but these investment trusts have delivered strong growth, says David Stevenson.
23 Sep 2022