Pressure on WH Smith sales

Fears of a tough Christmas for retailers were fuelled yesterday after WH Smith revealed fresh pressure on sales of its books, stationery and sweets.

The high street bellwether said sales on a like-for-like basis, which excludes changes in store space, were down 6 per cent on a year ago in the ten weeks since 1 September.

While the company remains on track for profits growth, analysts worried about prospects ahead of the peak trading season.

Total sales at its 561 stores at airports, motorway service areas and railway stations were flat on a year earlier but down 4 per cent when new space is stripped out. Total sales at the chain’s 612 high street stores were down 5 per cent and by 6 per cent at a like-for-like level.

David Jeary, a retail analyst at Investec Securities, made no change to his forecasts ahead of Christmas and said he retained a buy rating on the stock.

However, he added: “The figures today may disappoint some and provide some fuel for any bears of the stock.”

Jeary pointed out that WH Smith faced tough comparisons with a year earlier, when sales were driven by Tony Blair’s autobiography and Jamie Oliver’s 30 minute meals book.

WH Smith has focused on core areas such as books, news and impulse buys. The strategy recently helped it announce a 4 per cent increase in profits to £93 million for the year to 31 August, despite like-for-like sales falling 5 per cent.