Struggling British entertainment retailer HMV forecast a worse than expected loss for the 2011/12 year.
It blamed a weak new release schedule in CDs and DVDs in its final quarter.
But the 91-year-old retailer also said today it was confident of returning to profit in the 2012/13 year.
This was due to disruption to rival computer games retailer Game and better terms with key music and film suppliers.
HMV, famous for its Nipper the dog trademark, forecast a pretax loss of £16m for the year to April 28, ending the period with net debt of about £168m. It had previously forecast a loss of about £10m and net debt of up to £180m.
The firm said sales at stores open over a year fell 12.9% in the final 17 weeks of the year, particularly reflecting a very weak January.
For 2012/13 HMV forecast a pretax profit of at least £10m, well ahead of analysts' consensus forecast for a loss of around £5m. HMV added that the strategic review of its Live music venue business was ongoing.
The firm, which trades from about 250 stores in Britain and Ireland, employing about 4,500, has been shifting its emphasis from fast-declining CD and DVD markets into the growth markets of new technology products, live music and event ticketing.
It has closed stores, and sold its Waterstone's book chain and Canadian arm. It is facing intense competition from internet retailers and the rise of digital downloading as well as the march of grocers such as Tesco into general merchandise ranges.
