Retailer HMV has admitted that ongoing market turmoil and its continued poor performance could force it out of business after another miserable set of financial results saw its losses grow 62 per cent.
Sales in the 26 weeks to October 29 fell 17.6 per cent to £364.9 million, with the firm hit with a loss after tax of £50.1 million, up from £30.9 million this time last year.
While HMV's cost-cutting drive has been a success - its net expenditure reduced from last year's £56.8 million to £12.6 million - it is now sitting on debts of £163.7 million. In a statement couched in caveats, the board says it has a "reasonable expectation that the Group will have adequate resources to continue in operation for the foreseeable future.
"However, the economic environment and trading circumstances create material uncertainties which may cast significant doubt on the Group's ability to continue as a going concern in future."
Chief executive Simon Fox said: "This has been a challenging start to the year. Like all consumer-facing companies we are facing tough trading conditions but we continue to push forwards through this period. We remain well prepared for the key trading days ahead."
It's not all bad news: sales of technology rose 42 per cent in the 144 stores refitted to give greater prominence given to headphones, speaker-docks and tablets, with sales of those items up 147 per cent. Its concert business, HMV Live, also grew, with attendance of summer festivals up 30 per cent on last year, but the board has begun a strategic review that may result in the division being sold off.
Source: HMV