WH Smith's financial results for the year ending 31 August 2016 show a positive overall performance, driven by the retailer's travel business.
Total group sales up 3%
Total sales at WH Smith rose 3% year-on-year to £1.212bn, with like-for-like sales for the group up 1%. The retailer's travel business has driven this performance, with total sales up 10% and like-for-like sales up 4%. By contrast, the group's high street portfolio experienced a tougher year with total sales down 3% and like-for-like sales down 2%.
Group pre-tax profit up 8%
WH Smith has continued to deliver good profit figures with pre-tax profit for the year up 8% to £131m. Trading profit for the high street business, which operatesfrom 612 stores, brought in £62m, up 5% YoY while profit for the travel business increased 9% YoY to £87m. Extended food-to-go and successful meal deal promotions have been a driver for this performance, which led WH Smith to launch its private label brand 'Munch' in H2.
Eighteen new travel locations were opened in the UK in 2015/16, taking travel units to 576. Plans for the next three years are to open between 15-20 new travel stores, with 8-10 being located in hospitals. WH Smith acquired 32 new international sites in the year, taking the portfolio to 232 stores across 22 countries, and total travel units worldwide to 768. Last year the international business delivered total sales of £79m up 39%, and profit of £7m, up £2m on the previous year.
Further opportunities in travel
Having invested in the shopper experience with improved range, better value and clear shopping zones, WH Smith has outlined opportunities to build further on the success of its travel business in the following three ways:
- Existing stores through focusing on improved execution and customer service; investment in store layouts; space and category management
- Developing new formats and opening new space in the UK
- Expanding profitability overseas
UK portfolio progress
Card etailer owned by WH Smith, Funkypigeon.com, continues to perform well and will gain more investment in mobile and the customer journey. New franchise, WH Smith LOCAL, saw 44 stores open in the last year with 127 franchisees now signed up to the convenience concept.
New developments across the estate
Having trialled a digital offer at London's Victoria station, which provides shoppers with display fixtures to be able to try before they buy, this has now been rolled out to 23 stores. New dedicated bookshop stores have been opened at Heathrow T5 and Edinburgh airport, taking the total to seven, while others have been refitted. Most of the 17 hospital cafes have been changed to the new Coffee House brand, with plans to roll out this concept to more hospitals and even rail stores.