WH Smith’s high street chain remains under pressure after Funky Pigeon cyber hit
The group said it is looking to strip out more costs in the high street arm, with ‘significant’ savings earmarked.
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Your support makes all the difference.Retailer WH Smith has seen sales at its high street arm remain below pre-pandemic levels after a hit from the recent cyber attack on its Funky Pigeon online greeting cards business.
The group said it is looking to strip out more costs in the high street arm, with “significant” savings earmarked, “most notably through reductions in rent”.
Its full-year trading update showed that sales across its high street division over the second half fell to 80% of 2019 pre-Covid levels, down from 86% in the first six months.
But a rebound in its travel division helped overall group sales remain “comfortably” ahead of pre-pandemic levels, according to the group.
The chain said that, despite some ongoing disruption, the bounceback in the global travel market has boosted its sites across airports and railway stations, with travel store sales over its second half at 129% of levels seen in 2019.
In the most recent 11 weeks to August 27, sales were 135% compared with three years ago.
In April, its Funky Pigeon business was forced to stop taking orders after being hacked.
It said at the time that “no customer payment data” was at risk and that it did not believe any customers’ account passwords had been affected, but it took its systems offline “as a precaution”.
Thanks to the travel performance, WH Smith said group sales ended the second half at 112% of 2019 revenues, with the most recent 11 weeks at 117% of 2019 levels.
The travel division includes more than 580 stores in airports, hospitals, railway stations and motorway service areas, while there are around 560 sites in the high street business.
WH Smith kept its full-year guidance unchanged, having raised its outlook in June after the reopening of travel markets drove sales beyond pre-pandemic levels for the first time since the heavy toll of coronavirus.
It has been buoyed by expansion in the travel sector, having purchased US-based airport technology retailer InMotion in 2018.
The group added that it is due to expand further across the travel retail sector, with agreements on 130 new stores which have yet to open after recently winning a further six new stores in Brussels airport and across North America, including at Salt Lake City and Los Angeles International airports.