Debbie O’Shea has been named as the new Group IT Director for troubled entertainment retailer HMV Group, it was confirmed on Friday afternoon.
The appointment followed the announcement that the firm was selling its bookselling arm Waterstone’s to significant share holder Alexander Mamut in a deal worth £53 million.
O’Shea takes over from Garry Arthurs, who had held the position since 2007, on June 27th 2011 having already spent four years at the retailer.
She is currently Head of IT Business Systems and has previously worked as Head of IT Development within GTS, and has also held roles at fellow retailers Comet and Gap.
HMV will be keen to streamline its operations and minimise costs in the months ahead as it looks to arrange new credit facilities with its banks, and re-organise its business model post Waterstone’s.
Waterstone’s was seeing a dramatic fall in trading prior to its sale but worryingly for the retailer its main business had seen even steeper declines.
Like-for-like (LFL) group sales for HMV, excluding its live music segment, dropped 11 per cent in the year to April 30th 2011, whilst the final 17 weeks of this period saw LFL trading drop by 12.1 per cent year-on-year.
Commenting on the disposal on Friday, HMV CEO Simon Fox said: “We expect this deal to enable the group to achieve a reduction in the group’s borrowing requirements, and, in turn, focus on plans for transforming the HMV Group into a broad-based entertainment business.”
Although including the revenues from HMV Live improves the group’s trading figures slightly for the last year, its core domestic market was the worst performing part of the business.
Over the full 53 weeks LFL sales for HMV stores in the UK & Ireland plummeted 14.7 per cent, and were even worse – down 15.1 per cent – over the final 17 weeks.
HMV claims that its strategy to sell more technology products has already paid dividends at the stores it has been trialled at, but some fear that the company need to thinks seriously about which direction it is moving in after letting Waterstone’s go.
“They have lost one of the key assets in their long-term re-invention,” argued Matt Piner, Retail Analyst at Verdict Research.
“It is well known that spending on music, video, computer games and books is transferring online and to digital formats. Yet there will always be a proportion of consumers that prefer the store environment, for book shopping in particular.
“Creating dual branded destination stores, offering a range of entertainment products, could have been a major draw for HMV. Now they will need to think of other ways to drive footfall to their remaining outlets.”