WH Smith hurt by travel turbulence

WH Smith has become the latest victim of the turmoil in the travel sector after losing £105m of sales in April due to half its stores being closed.

The retailer’s shops located in airports and railway stations lost 91pc of their revenues, while High Street outlets lost three-quarters of business.

The retailer has furloughed many of its 14,000 staff, deferred tax payments and cancelled the interim dividend, which last year was worth £22m. Executives have also taken a 20pc pay cut. After a ‘significant decline’ in passenger numbers most airport and railway stores have been closed, leaving 337 of its 1,166 stores open.

This includes 130 stores open in hospitals, four at Heathrow, and 203 high street stores open which have post offices inside them.

It has found success online where it sells books, stationery and items for home offices as workers stay at home and parents look for things to keep the children entertained. Online sales of books alone have increased by 400pc in the last month.

Before the pandemic, WH Smith held its own in tough conditions by charging higher prices in train stations, airports and motorway service stations where there is little or competition.

Heading into the crisis, like-for-like sales in the six months to February were down 1pc to £747m, pushing profits down 3pc to £63m. High Street stores performed worse, losing 4pc of sales, compared to travel locations where sales rose 2pc.

Carl Cowling, chief executive, said: ‘Since March, we have seen a significant impact on our business as a result of Covid-19.’