EMI remains in danger of defaulting on banking covenants despite several cash injections and a corporate restructuring which led to a significant decrease in its annual loss, according to the company's latest annual report.

The well-known UK music company, home to acts like the Beatles and Pink Floyd, along with artists including Gorillaz and Lily Allen, was acquired for £4.2bn in 2007 by Guy Hands' private equity firm Terra Firma in a deal largely financed by loans from Citigroup which remains saddled with £3bn debt.