Waterstone's boss leaves after 'unsatisfactory' sales

HMV Group today branded Waterstone's Christmas performance "unsatisfactory" as it announced the departure of the book chain's boss.

Waterstone's saw its like-for-like sales slump 8.5 per cent in the five weeks to 2 January, as it suffered from the weakness in the high street book market and the collapse of Borders, which finished its closing down sales on Christmas Eve.

HMV today said it had appointed Dominic Myers as managing director of Waterstone's, replacing Gerry Johnson who will also leave the group's board.

Meanwhile, the HMV chain enjoyed record trading in the period in the UK and Ireland, helped by its improved position after the disappearance of rival Zavvi from the market and the addition of temporary Christmas stores.

HMV group chief executive Simon Fox said the appointment of Mr Myers at Waterstone's would herald a period of change for the high street bookseller.

The new strategy will include tailoring its offer to local markets and growing the chain's online presence.

He said the firm would seek to build on its position as the "only remaining specialist bookseller in the high street" and should be looking to grow its market share as HMV had done after the collapse of its rivals.

An extra headache for Waterstone's recently came from usually lucrative non-fiction big name autobiographies, which "underperformed" over the Christmas period.

But Mr Fox said the chain "needs to be doing better and needs to differentiate its offer in a more substantial way".

He added: "Whilst the recent performance of Waterstone's has been unsatisfactory, it remains an excellent business and brand, with a great opportunity as the only remaining specialist bookseller on the high street."

HMV saw like-for-like sales rise 2.2 per cent in the UK and Ireland, with total sales up 14.6 per cent.

Mr Fox said the chain had seen 20 per cent growth in CD sales - helped by demand for artists such as Susan Boyle - and a 10 per cent rise in DVD and games.

He said the firm's 10 temporary Christmas outlets had performed well and there were plans to keep some stores.

But he said HMV could also have done better in the period.

"Had it not been for the adverse weather which disrupted trading on some key days, our like-for-likes would have been about 1 per cent higher," he said.

The group, which reported an overall like-for-like sales decline of 1.2 per cent in the period, said it would issue a formal takeover offer for the MAMA Group tomorrow.

HMV's £46 million bid comes less than a year after the two companies formed a joint venture which owns 11 music venues and an interest in events such as London's Lovebox festival.

The 11 venues owned by the Mean Fiddler joint venture are the Hammersmith Apollo, the Forum, the Garage, Jazz Cafe, Heaven, G-A-Y Bar, G-A-Y Late, and the Borderline in London, as well as the Edinburgh Picture House, the Birmingham Institute, and Aberdeen's The Warehouse.