Travel recovery lifts WH Smith sales ahead of targets
The retail group revealed that total sales in the six months to August 31 were 65% of pre-pandemic levels.
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.WH Smith said its sales for the past year are expected to be “slightly ahead” of expectations as its travel business continued its recovery in recent weeks.
However, shares in the company slipped after it said next year’s profits will be at the bottom of its previous guidance.
The retail group revealed that total sales in the six months to August 31 were 65% of pre-pandemic levels from the same period in 2019.
It said it was boosted by improvement in the last eight weeks of the period, with group sales at 71% of 2019 levels, after a lift in travel trade as airport and train station stores saw footfall recover more.
UK traveller numbers are still “significantly down” versus 2019 but the group highlighted the “gradual recovery” in activity in July and August.
We remain confident in revenues returning to pre-Covid levels in the next two to three years
The retailer said it will grow its UK travel arm despite uncertainty in the sector caused by Covid restrictions, with plans for four more stores in Scottish airports after previously announcing plans to expand its InMotion brand across 18 former Dixons Travel sites.
WH Smith said its North American business performed “well” over the past two months, with sales in July and August at 93% of pre-pandemic levels.
Meanwhile, the firm said its high street business reported revenues at 85% of 2019 levels for the half-year to the end of August.
The retailer also told shareholders however that finance charges linked to recent bonds mean it currently expects its profit for the next financial year to be “at the lower end of market expectations”.
In a statement, WH Smith said: “As previously stated, we remain confident in revenues returning to pre-Covid levels in the next two to three years.
“While there will be a return to good levels of profitability in the year ending August 2022, the trajectory of the recovery in travel remains uncertain.
“Although the pace of recovery varies across our markets, we are financially strong and well placed to capitalise on the multiple growth opportunities in our key markets.”
Shares dropped by 4.9% to 1,552.5p in early trading.