The company credited with turning around the fortunes of HMV, Hilco Capital, has negotiated a new CAN $30 million (21m Euro) working capital facility for the retailer’s business in Canada.
In what Hilco chief exec – and HMV Canada chairman – Paul McGowan calls a “massive vote of confidence” for the company, the funding has become available through a refinancing of HMV Canada’s banking facilities with Bank of Montreal (BMO). Hilco subsidiary Re:Capital represented the retailer.
HMV operates across 108 stores in Canada. It is the retail market leader for entertainment audio and recently launched a new website in the region (www.hmv.ca).
Paul McGowan Chief Executive of HMV’s owners, Re:Capital, and Chairman of HMV Canada, commented: “This is a great vote of confidence in the HMV business from a major Canadian institution, demonstrating the strength of the business and emphasising its position at the preeminent entertainment retailer in Canada.”
Nick Williams, Chief Executive of HMV Canada, commented: “This is a Christmas present for our business, at our busiest time of year. Everyone who has visited our stores over the holiday season will be able to see the strength of our business and the huge demand for our unrivalled range of entertainment product. We look forward to building a strong relationship with BMO.”
HMV Canada was acquired by Hilco subsidiary Re:Capital in July 2011. Hilco Capital acquired HMV UK after it went into administration in January, 2013.
According to annual accounts, HMV UK posted nearly £17m in operating profit in the 11 months after Hilco swooped for the business: between January 29 and December 28 2013, the chain made £16.7m of operating profit from £311.2m of turnover.
Due to one-off costs, including £10m in inter-company charges, £4m of one-off restructuring costs and £2.3m in interest, HMV posted a pre-tax loss of £4.8m in the period. But Hilco claims every store it operates in the UK – a now manageable tally of around 140 outlets – is now profitable.Music Business Worldwide
