WH Smith to open more than 120 travel stores after post-pandemic sales rebound

Retail stalwart WH Smith has revealed plans to open more than 120 new stores in railway stations and airports after resurgent travel demand provided a sales boost.

The group also saw profits more than double as it continues to shift its focus further towards airport and railway station shops instead of its traditional high street outlets. Chief executive Carl Cowling hailed “strong” current trading and told shareholders performance was “ahead of expectations for the full year”. Group revenues increased by 41 per cent to £859 million for the six months to February 28, compared with the same period a year earlier. As a result, pre-tax profits climbed to £45m from £18m in the previous half-year.

WH Smith benefited from a strong rebound in passenger numbers after the easing of pandemic travel restrictions. The group’s UK travel business saw sales jump by two-thirds to £314m against the same period a year ago, making it the firm’s largest division. Meanwhile, it saw high street sales dip 1 per cent to £266m.

Bosses of the group, which has a history stretching back more than 230 years, said its growing travel arm is set to represent over 70 per cent of all revenues by the end of the year, as well as 85 per cent of its profits. The focus on travel is set to increase further, with the company confirming more than 120 new travel shops are earmarked to open, with 50 set to launch in the current half-year. The pipeline of new shops will include significant investment to grow the North American business.

Cowling said: “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. Looking ahead, 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.”

Adam Vettese, an analyst at social investing network eToro, noted: “WH Smith’s strong recovery has been largely powered by its booming travel division, which was hammered by the severe restrictions imposed on the travel industry during Covid. While the UK remains the firm’s most important revenue generator, its rapid expansion into the rest of the world is encouraging and hints at significant growth potential. It wasn’t so long ago that people were downbeat on WH Smith, but its performance coming out of the pandemic has been impressive. Switching its focus from the high street to travel has paid off.”

John Moore, senior investment manager at wealth firm RBC Brewin Dolphin, said: “There is some natural recovery still playing through in WH Smith’s results, with a considerable rise in profits and cash generation. The retailer has been using cash from established, but low return, businesses like its high street operation to invest heavily in the highly fragmented North American travel market. That is beginning to make a difference to its bottom line. WH Smith is a really under-appreciated, well managed and financially stewarded business.”