Bosses at high street retailer HMV will not be changing their tune for a while, after a renewed focus on vinyl and live music has helped the firm return to profit after it fell into administration.
The retailer, which is now owned by Sunshine Records and Entertainment, has reported its highest profits since it was rescued from administration by Canadian businessman Doug Putman in 2019.
The company has enjoyed surging sales of vinyl records, which became more popular than any other physical music format for the first time since 1987 last year.
They are particularly popular among younger music fans, with the likes of Taylor Swift and Harry Styles propelling total UK record sales above 5.5 million units in 2022. The total value of record sales grew 11 per cent to £150.5m last year, according to the Entertainment and Retail Association.
Sales at Sunshine, which also owns the smaller chain Fopp, jumped from £90m to £150m in the 12 months to May 2022, the latest accounts filed with Companies House show, helping it to return to a £1.9m profit, up from £240,000 in 2021, when Covid lockdowns kept many stores closed.
It comes as a result of Mr Putman’s refocusing of the once-troubled retailer. HMV fell into administration in 2013 and was bought by restructuring firm Hilco, only to collapse once again in 2019.
The Canadian businessmen, who also owns Toys’R’Us Canada, bought HMV in a deal worth a reported C$1.5m (£920,000) and managed to rescue its 100 stores, though later closed 27 of those, including its flagship Oxford Street location.
Mr Putman changed the music at HMV, making changes such as signing deals to stock exclusive record pressings that could not be found in other retailers, and launching his own record label in September 2022.
At the time, he said that the HMV label would focus on signing two or three “unknowns” a year, after unveiling Newcastle singer songwriter India Arkin as its first signee.
“Streaming algorithms mean it’s hard for new artists to get their voices heard, so we’re giving them the chance to get their albums in our stores, where music fans can discover them for themselves,” he added.
HMV has also expanded since Mr Putman acquired the firm, opening 10 new stores in 2022, including one in Dudley that is focused on stocking the latest vinyl.
“Vinyl has enjoyed an ongoing revival, and many of the world’s biggest music artists now make vinyl a key part of their new album promotions, attracting collectors of all ages,” Mr Putman added.
“Looking ahead, we expect another solid performance. We’re committed to further expanding the HMV store estate where there are opportunities that make sense.”
Another focus has been on pop culture merchandise, with items such as “Funko Pop” figurines of Spider-man, Stranger Things and Star Wars characters proving particularly popular.
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