WH Smith sales hit 14-year high as travel takes off again
A POST-PANDEMIC boom in travel has helped propel WH Smith back into the black as sales at the retailer soar to a 14-year high.
WH Smith said there was a strong recovery in its airport stores, even as major transport hubs including Heathrow and Gatwick enforced caps on passenger numbers over the summer.
It posted pre-tax profits of £63m for the year to the end of August compared with a £116m loss the previous year, buoyed by its travel business.
WH Smith reinstated shareholder payouts, and said there had been a significant step-up in airport sales over July and August.
Revenues from its airport stores was at 93pc of 2019 levels in the year to the end of August, but rose to 132pc in the 10 weeks to Nov 5. The retailer said there was “further recovery to go” as more people are using airports after booking getaways following years of lockdowns.
Carl Cowling, the chief executive, said there was unlikely to be pressure from a cost of living spending slump.
He said: “You’ve got to remember that passengers are still significantly down on 2019 levels. If you think about the amount of people flying out of Britain for holidays, the passenger numbers even now are still down something like 15pc so there’s still a lot of pent up demand.”
He said that during the last recession the slip in passenger numbers was about 5pc. He added: “So all the forecasts suggest that we will see growth in passengers.”
The rise in sales in the travel business sent WH Smith’s revenues up 58pc on last year to hit £1.4bn. The company said this was “the highest annual revenue generated by the group since its creation in its current form in 2006”.
It came despite some dampening in footfall from the rail strikes. But Mr Cowling said most of WH Smith customers to its rail stores were not commuters during rush hour, and so the hit was less severe.
Overall, the return to the office meant revenue from rail was running at 92pc of 2019 revenue in the 10 weeks to Nov 5, compared with 79pc in the year to the end of August.