Waterstone's continues to struggle

Music and games group HMV today said a worsening performance from its Waterstone’s book chain was hitting sales growth as the business suffers in tough markets.

Waterstone’s saw like-for-like sales slide 5.1% in the 26 weeks to October 26 but said sales weakened as the period wore on.

Although the chain should eventually benefit from the recent demise of rival Borders, the decline more than offset a 1.6% rise from HMV’s main UK and Ireland arm to leave the overall group’s like-for-like sales 2.1% down.

The firm remains “confident” over prospects for the full year but added: “The group continues to operate in challenging and highly competitive markets, particularly the book market, where Waterstone’s performance remains weak.”

HMV’s results depend on the crucial Christmas trading period, with profits being delivered in the second half of the year.

The firm’s first-half seasonal loss narrowed to £24.9m (€27.6m) from £27.5m (€30.4m) a year earlier, broadly in line with City hopes.

Operating losses at Waterstone's for the first half widened by £3.6m (€3.9m) £12.9m (€14.2m), HMV said. Sales have deteriorated from the 3.4% like-for-like falls seen at the end of August.

The pressure on the chain, which has 312 stores, has been echoed across the high street as supermarkets and online competitors grab a greater share of the consumer book market.