A website upgrade, video games and “next-generation” stores appear to have helped HMV (LSE: HMV) turn a corner. Pre-tax profit in the year ending April 26 were up 25.2 percent to £56.6 million – a far cry from last year, when profits were cut in two by falling physical-media sales, but still a far cry from 2006′s £98.2 million.
The revamped hmv.com saw 40 percent growth (though it’s not clear whether this is sales or traffic), with online CD and DVD sales now making up 10 percent of company sales. During the year, HMV added MP3 support to its online checkout and started its HMV Jukebox, £5.99-a-month all-you-can-eat music subscription – though no figures were given for this.
It launches its GetCloser music social network in public beta today, with advertising, sponsorship and sales revenue streams – but it’s frankly not clear whether customers want this kind of media library comparison network.
Games and technology sales were up 59 percent and 95 percent respectively and now make up 21 percent of income, up from 14 percent a year ago. DVD sales growth outstripped overall market growth at 18 percent. After opening fancy new stores featuring transactional kiosks, soft areas and game zones, HMV found all products in the experimental shops sold faster, so it’s planning to convert between 10 and 15 more stores to the new format in the next financial year. Waterstones.com sales grew 140 percent by a site upgrade.