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koala_bear

Peston "hmv: It Gets Worse"

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I have been told by two music and entertainment companies that they can no longer get credit insurance for additional sales to HMV.

HMV shop

Here is an extract from an e-mail sent by the "head of credit and collections" at the UK arm of a major UK manufacturer and distributor of CDs and DVDs:

"I need to advise you that our credit insurers have significantly reduced our insured credit limit on all HMV entities. Based on the current HMV balances, the limit is not sufficient to support any sales on an insured basis moving forward.

"I have this morning met with the Chief Executive and Risk Director at the insurance company to understand the reasons for such a quick and drastic reduction. Due to HMV's listing on the stock exchange, they are unable to divulge the reasons for their decision. They met with Simon Fox last week and whilst they have said that HMV has provided everything asked for, they are clearly worried following the public announcement that bank covenants may not be met. A further review will take place in 4 weeks time."

Potentially thousand of jobs loss and hundreds of vacant shops on the high street.

The next step of the probable end in slow motion.

Wollies lasted about a month from this point

Edited by koala_bear

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Crikey! I'll have to get an instrument out, or two, and make my own music like the Victorians! :blink:

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My lad got a 20 pound voucher of theirs for Xmas. Even when we went in there, knocking 20 quid off the game he wanted still wasn't much cheaper than the internet.

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Could this be a record bankruptcy?

Will be music to some Lawyers ears?

Lawyers rarely hear music! :huh:

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Could this be a record bankruptcy?

Will be music to some Lawyers ears?

No it won't be a record bankruptcy. Nowhere near the size of Lehman Bros.

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HMV has been doomed for years. Even in the '90s I didn't understand why anyone shopped there, as the prices were far too high.

In the internet era, I'm amazed that HMV has survived as long as it has.

Like Blockbuster, this isn't indicative of the wider economy, merely just an outdated business model.

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Like Blockbuster, this isn't indicative of the wider economy, merely just an outdated business model.

Yes, like Woolworth! :unsure:

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Surely there cannot be any problems at HMV? I mean their top staff got inflation busting pay rises in 2010. They must be doing something right????

Executive Directors

Simon Fox 2010 £874,000 2009 £579,000 +51%

Neil Bright 2010 £559,000 2009 £349,000 +60%

Gerry Johnson 2010 £494,000 2009 £312,000 +58%

Non-Executive Director

Robert Swannell 2010 £200,000 2009 £50,000 +300%

And thats before looking at bonuses and share options

http://www.hmvgroup.com/investors/financial-reports/reports-results/~/media/Files/H/HMV-Group/Annual%20Reports/hmv_annual-report-2010.pdf

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HMV has been doomed for years. Even in the '90s I didn't understand why anyone shopped there, as the prices were far too high.

In the internet era, I'm amazed that HMV has survived as long as it has.

Like Blockbuster, this isn't indicative of the wider economy, merely just an outdated business model.

actually i think its very indicative of the wider economy, as you say you arent sure how it survived unttil now, it survived all the way through the internet boom/downloading because its business model was based on added value that people would pay extra for, Nothing has changed with regards that so the change has to be because added value is now a luxury people cant afford.

Im not sure what benefits peston thinks he brings by divulging this information, it can only hurt hmv, and his source has probably had their last invite to the table of their credit insurers if they are so blase in divulging market sensitive, confidential information

Edited by Tamara De Lempicka

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In the internet era, I'm amazed that HMV has survived as long as it has.

Like Blockbuster, this isn't indicative of the wider economy, merely just an outdated business model.

Correct... bricks and mortar can't possibly compete with the range of music available online, and for the recent releases you can pick it up with your weekly groceries.

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Surely there cannot be any problems at HMV? I mean their top staff got inflation busting pay rises in 2010. They must be doing something right????

Executive Directors

Simon Fox 2010 £874,000 2009 £579,000 +51%

Neil Bright 2010 £559,000 2009 £349,000 +60%

Gerry Johnson 2010 £494,000 2009 £312,000 +58%

Non-Executive Director

Robert Swannell 2010 £200,000 2009 £50,000 +300%

And thats before looking at bonuses and share options

http://www.hmvgroup....report-2010.pdf

I suspect that the share options might not be worth too much right now....

Anecdotally, I was looking for a CD as an xmas prezzie a month ago; it was £15 in HMV and £12 in Morrisons, where I bought it from.

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Surely there cannot be any problems at HMV? I mean their top staff got inflation busting pay rises in 2010. They must be doing something right????

Executive Directors

Simon Fox 2010 £874,000 2009 £579,000 +51%

Neil Bright 2010 £559,000 2009 £349,000 +60%

Gerry Johnson 2010 £494,000 2009 £312,000 +58%

Non-Executive Director

Robert Swannell 2010 £200,000 2009 £50,000 +300%

And thats before looking at bonuses and share options

http://www.hmvgroup.com/investors/financial-reports/reports-results/~/media/Files/H/HMV-Group/Annual%20Reports/hmv_annual-report-2010.pdf

Clearly the writing was on the wall then, so they were emptying the tills whilst there was still some spare change in them.

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Correct... bricks and mortar can't possibly compete with the range of music available online, and for the recent releases you can pick it up with your weekly groceries.

Yep it's an old business model, Amazon has got the stitched up. If you want an old release your not going to pay £10 for it unless you are mental or seriously loaded and need it NOW. If you want an old album you might get it 2nd hand for 1p + shipping from Amazon which comes to £1.27 once you've got it as low as that new old album sales are dead unless they are £3 or £4 and you fancy paying the premium for having it new. It's just hard to see who HMV can compete as Amazon just has a couple of warehouses against a massive high street presence once more our high cost economy comes into play and HMV lose.

Not bought anything from HMV for years, it must have been either an album or DVD on sale have no idea what or when must be at least 5 or 6 years ago if not more. I'll probably never set foot in one of there shops again.

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Surely there cannot be any problems at HMV? I mean their top staff got inflation busting pay rises in 2010. They must be doing something right????

Executive Directors

Simon Fox 2010 £874,000 2009 £579,000 +51%

Neil Bright 2010 £559,000 2009 £349,000 +60%

Gerry Johnson 2010 £494,000 2009 £312,000 +58%

Non-Executive Director

Robert Swannell 2010 £200,000 2009 £50,000 +300%

And thats before looking at bonuses and share options

http://www.hmvgroup.com/investors/financial-reports/reports-results/~/media/Files/H/HMV-Group/Annual%20Reports/hmv_annual-report-2010.pdf

It would be interesting to hear why they got such big increases.

And profits for 2010 where what?

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I suspect that the share options might not be worth too much right now....

Anecdotally, I was looking for a CD as an xmas prezzie a month ago; it was £15 in HMV and £12 in Morrisons, where I bought it from.

How blind are the shareholders?

Massive pay rises at the top.

Price rises on goods to pay for them.

Customers go elsewhere.

Shares lose value.

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The optimistic half of me (waist down) sees HMV doing an Officer's Club.

Um what did they do? (Not been on the highstreet for a very long time bar Bolton when I had to pay a bill and it looked like WWII stalingrad)

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Correct... bricks and mortar can't possibly compete with the range of music available online, and for the recent releases you can pick it up with your weekly groceries.

A while ago though there was talk about the EU wanting a law which said that for X amount of products there had to be Y number of brick and mortar stores.

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It's just hard to see who HMV can compete as Amazon just has a couple of warehouses against a massive high street presence once more our high cost economy comes into play and HMV lose.

Amazon are actually BAD for business though, as they also act as a shop front for smaller shops, they gain incredible advantages from this though notably drop shipping whereby stuff ordered via Amazon doesn't even hit the amazon warehouse it comes direct from the manufacturer who prints amazon packaging!

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How blind are the shareholders?

Massive pay rises at the top.

Price rises on goods to pay for them.

Customers go elsewhere.

Shares lose value.

The shares are sitting in yours, mine and everyone elses pension funds. It is the fund managers speaking up for us right ? you know the ones who's ops run from the same district as their 'mates' at HMV

Edited by tomposh101

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  • 285 Brexit, House prices and Summer 2020

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      • down 5% +
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      • up 5%



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