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

The MoneyWeek Podcast: picking stocks is fun, but you need to do your homework
Investment strategy

The MoneyWeek Podcast: picking stocks is fun, but you need to do your homework

John Stepek talks to Steve Clapham, investor, analyst and author of The Smart Money Method, about the dangers in picking individual stocks and why you…
8 Apr 2021
BP looks set to return more money to shareholders as it beats expectations
Energy stocks

BP looks set to return more money to shareholders as it beats expectations

Oil major BP is to embark on a share buyback programme after significantly reducing its debts. Saloni Sardana looks at what it means for your portfoli…
6 Apr 2021
Deliveroo has hit the market – but it’s not getting the warmest welcome
UK stockmarkets

Deliveroo has hit the market – but it’s not getting the warmest welcome

Food delivery company Deliveroo made its debut on the stockmarket this morning. But with the share price sliding by 30% straight away, it’s not made t…
31 Mar 2021
Three stocks to buy now that will come back stronger after Covid-19
Share tips

Three stocks to buy now that will come back stronger after Covid-19

Professional investor Ed Wielechowski of Odyssean Capital, chooses three compelling stocks that should thrive in a post-pandemic world.
29 Mar 2021

Most Popular

The bitcoin bubble will burst: here’s how to play it
Bitcoin

The bitcoin bubble will burst: here’s how to play it

The cryptocurrency’s price has soared far beyond its fundamentals, says Matthew Partridge. Here, he looks at how to short bitcoin.
12 Apr 2021
Four investment trusts for income investors to buy now
Investment trusts

Four investment trusts for income investors to buy now

Some high-yielding listed lending funds have come through the crisis with flying colours. David Stevenson picks four of the best.
12 Apr 2021
Central banks are rushing to build digital currencies. What are they, and what do they mean for you?
Bitcoin

Central banks are rushing to build digital currencies. What are they, and what do they mean for you?

As bitcoin continues to soar in value, many of the world’s central banks are looking to emulate it by issuing their own digital currencies. But centra…
8 Apr 2021