WH Smith travel store sales overshadow high street as retailer hikes dividend

Rebecca Smith
High street sales have been overshadowed by the retailer's travel business
High street sales have been overshadowed by the retailer's travel business (Source: Getty)

WH Smith's booming travel business has been propelling the high street stalwart for a while now.

And today the company announced that revenue for its 815 shops across train stations and airport terminals has trumped high street sales for the very first time.

Read more: WH Smith to benefit from higher travel sales

The figures

Profit in travel was up 10 per cent to £96m. Travel is the largest part of WH Smith, in both revenue and profit.

The board has also proposed a 10 per cent hike to the final dividend, and announced a further share buyback of up to £50m.

Group profit before tax rose seven per cent from £131m last year to £140m for the 12 months to August 2017.

Group revenue rose two per cent to £1.2bn, in line with analyst forecasts, with travel revenue up nine per cent, while high street revenue dipped five per cent.

And while travel trading profit rose 10 per cent, high street trading profit remained flat at £62m.

Why it's interesting

Fads such as spoof books (think Enid Blyton parody Five on Brexit Island) and adult colouring books have provided a boon to the retailer's high street sales in recent results, but its travel arm has been doing much of the heavy lifting.

And WH Smith's stores in airports, train stations and motorways, have truly left its high street stores in the shade, now accounting for over 60 per cent of the firm's trading profit.

For the firm's 225th anniversary year it fittingly opened its 225th international store, and now has 233 open in total. It's continuing the focus on travel, with 15 new units opened in the UK during the year.

What the company said

Stephen Clarke, WH Smith's chief executive, said:

The board has proposed a 10 per cent increase in the final dividend and we have today announced a further share buyback of up to £50m reflecting the group's cash generation and our confidence in the future prospects of the group.

This performance is only possible through the hard work and commitment of our 14,000 colleagues across the business and I am grateful for their continued support.

Looking ahead, we will focus on profitable growth, cash generation and new opportunities to profitably invest in the future. While the economic environment remains uncertain, we are well positioned for the current year and beyond.

Read more: WH Smith says trading is on track as it opens stores in Italy

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