HMV Group posted a pre-tax loss of £28.7 million in the six months to October 27 – excluding proceeds from the disposal of HMV Japan – in line with market expectations.

The loss is down slightly on the£29.2 million for the same period a year ago. HMV Japan was sold for£70.6 million in July.

Total group sales increased 9.5 per cent to£790.2 million, with like-for-likes up 5 per cent.

At HMV’s UK and Ireland music chain, like-for-likes rose 9.2 per cent, driven by the rapidly expanding UK games market. The retailer has also increased games from 9 to 15 per cent of the mix. However, Seymour Pierce analyst Andrew Wade said: “This change in mix has had a negative impact on margins.”

At bookseller Waterstone’s, like-for-likes rose only 1.4 per cent. Wade said: “Performance was less impressive in Waterstone’s, in a market that continues to be competitive.” And international sales were flat year-on-year, with like-for-likes sliding 2.5 per cent, affected by a poor performance at HMV Canada.

HMV chief executive Simon Fox said: “Less than a year into our three-year strategic plan, we are pleased with the progress. The group's first half was driven in particular by like-for-like sales growth at HMV UK & Ireland, where we are exploiting successfully the high growth of games and technology categories and increasing our share of music and DVD.”

Wade added: “In all, a positive update – albeit driven largely by the strength of the UK games market. HMV is beginning to deliver on its plans and we see further opportunities for market share gains as competitors continue to drop away.”

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