WH Smith buys Dixons airport shops
WH Smith has snapped up a raft of former Dixons Travel stores in airports as it expands its Inmotion technology and accessories business into the UK, while flagging an improving trading backdrop.
The retail stalwart said it had bought 18 stores, including 17 Dixons Travel outlets, at sites including major UK airports London Heathrow, London Stansted, Manchester and Birmingham, which will deliver sales of about £60 million a year, in a “fully recovered travel environment”.
In April, Dixons Carphone confirmed plans to close its 35-strong airport store business Dixons Travel after it was hammered by the pandemic and the end of tax-free tourist shopping.
WH Smith plans to take on around 200 of the 400 Dixons Travel staff who were impacted by the closures.
The 229-year-old newsagent and book seller bought US airport-based retail firm Inmotion in late 2018 in a deal that doubled the size of its international travel business. At the time, Inmotion was the largest airport-based digital accessories retailer in North America, with 750 staff and 114 stores across 43 airports in the US.
Details of the UK expansion plans came as WH Smith said sales remained under pressure, with high street trading sitting at 86 per cent of 2019
levels in the 18 weeks to July 3, though this is up from 84 per cent in the second quarter.
Its travel chain covering airport and railway station sites continues to be impacted by global pandemic restrictions, with UK sales at just 32 per cent of 2019 levels and global sales at 48 per cent of pre-covid levels.
Total group revenues stood at 62 per cent of 2019 levels in the 18 weeks to July 3.
But bosses have been “encouraged” by the improving trends and the group
expects a “small improvement” on its full-year expectations thanks to a better-thanforecast performance across North America.
Its US business saw total sales improve to 88 per cent of 2019 levels in June, with the division’s trading boosted by the removal of all Covid-19 restrictions in Las Vegas from the start of June.
In the UK, travel sales have improved to 38 per cent of 2019 levels in the week to July 3 as restrictions have eased.
“Following the stronger than anticipatedperformancefrom our North America business, we anticipate a small improvement to management’s expectations for the current financial year,” the firm told investors.
In April, the group, which has been forced to cut hundreds of jobs, announced new financing arrangements as it slumped to a first-half loss.
It reported a headline group loss before tax of £17 million for the six months to the end
of February, compared with a profit of £80m a year earlier.
Chief executive Carl Cowling said at the time: “We have positioned the group well. We are financially strong as a result of the actions we have taken, and the new financing arrangements also announced today will put us in an even stronger position to capitalise on the growth of our key markets and take advantage of the many exciting opportunities ahead.”