WH Smith has benefited significantly from the return of global air travel with a big boost in profit on last year.
The popular high street newsagent reported £45m in pre-tax profits, up from £18m last year, as millions came through airports where Smiths has many outlets.
In the six months to February 2023, it announced £314m revenue for UK air travel, up 66 per cent on last year, while overall, the group revenue was more than £850m, an increase of 41 per cent.
The retailer however reported a drop in its high street arm, with revenue down one per cent, as the cost of living crisis continued to bite into Brits’ spending habits.
When asked if it will be winding down or scaling back its high street operation, a spokesperson for WH Smith said the firm is fully committed to the high street.
WH Smith announced it has a new “pipeline” for 120 stores including 60 in North America.
“We have seen a strong performance in the first half of the year further strengthening our confidence in the prospects of our global travel business”, said chief executive Carl Cowling.
In a nod to the increasing dependence on the travel market, he said the company expects it to “represent over 70 per cent of Group revenue and around 85 per cent of Group profit from trading operations by the end of this financial year.”
“In North America, we continue to open new stores with 29 opened in the period and these are performing well. At the same time, we have grown our new store pipeline with significant tender wins.
“We have won a further 28 stores so far this year, including 11 in Canada”, he added.
He said the firm’s largest division, Travel UK, reported its “revenues are 19 per cent ahead of 2019 levels despite passenger numbers being considerably below 2019 levels.
“I am increasingly excited by the opportunity in our Rest of the World division” while
looking ahead for the rest of the year “we are very well positioned to capitalise on the substantial growth drivers across our markets and we expect to make further good progress in the years ahead. Current trading is strong and we are ahead of expectations for the full year.”
Following its results, its share price was down by around 2.5 per cent.