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Indigo Books & Music Inc. slid to a loss in the fourth quarter on heavy charges for investments in its digital business such as its Kobo e-reader, results showed on Tuesday.

Canada's biggest retailer of books, electronic books and e-readers said earnings fell to a loss of $11.7-million, or 47 cents a share for the three months ended April 2.

That compared with earnings of $497,000, or 2 cents a share, in the same period a year earlier.

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The company, which is spending heavily to tap into the trend of reading books on smartphones, tablets or notebooks, paid $21.8-million in financing charges and interest during the quarter. That compared with charges of $936,000 in the same period a year ago.

E-reading service Kobo, which was spun off in late 2009, but in which Indigo is still the majority shareholder, comes pre-installed on devices such as Samsung's Galaxy Tab and Research In Motion's PlayBook.

Kobo raised $50-million in funds from investors earlier this year to speed up its expansion and new product development.

Indigo said its revenue fell nearly 8 per cent to $211-million in the fourth quarter, partly because the company lacked a hit equal in success to last year's Twilight trilogy.

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