HMV says dull Christmas music sales to hit profits | Business | Reuters.co.uk

LONDON (Reuters) - An uninspiring Christmas music chart, topped by Take That, and discounting by online rivals has hit sales at HMV Group, causing the music and book retailer to warn on profits. The value of the UK music market, including digital downloading, fell by 14 percent during October and November, HMV said in a statement on Wednesday.

"If you compare the line-up (of music releases) this Christmas with last, it isn't as exciting," Chief Executive Simon Fox said.

"It's not as impressive, with Take That at number one," he added. "We are likely to come in at the bottom end of City expectations." Investment banks had been forecasting year pretax profit anywhere between 69 million pounds and 90 million.

HMV said the bottom end of the range was 68-69 million pounds. Fox said the group had still managed to build market share, but analysts said this had been done by cutting margins heavily to compete with the likes of Amazon and the group had not kept pace with technological advances. The Christmas shopping season has made an encouraging start, with retail sales rising at their sharpest rate in two years, the Confederation of British Industry said on Wednesday.