- WH Smith saw revenue from its travel division rise 9% in the 13 weeks to 1 June.
WH Smith’s expansion into travel centers across the country is more than offsetting the continued decline in its high street business.
The retailer told investors on Wednesday that UK online and in-store revenue fell 4 percent in the 13 weeks to June 1, but like-for-like sales remained stable.
Across the group’s entire travel division, which has stores in transport hubs such as train stations and airports, revenue rose 9 percent over the same period.
Total revenue rose 8 per cent in the airline sector, 14 per cent in hospitals and 8 per cent in rail during the period, WH Smith said.
“It will be interesting to see if the company takes more decisive action in its high street business as the sector continues to struggle,” Russell Pointon, head of consumer at Edison Group, said on Wednesday.
Focus: Travel hubs such as train stations and airports are crucial for WH Smith
WH Smith Stock They rose 2.62 per cent or 30.00 pence to 1,173.00 pence on Wednesday, having fallen more than 26 per cent in the last year.
The group told shareholders it remained on track to hit full-year guidance despite a slowdown in sales growth in the third quarter, as strong growth in the travel division was tempered by the slump. of sales on the main street.
Total group sales rose 5 percent at the end of the period, up from 8 percent.
Turnover in the travel division rose 8 per cent, slowing from 13 per cent, as growth rates in the UK, North America and Rest of the World Travel segments slowed.
In the UK, WH Smith said growth had slowed “as we annualise the strong recovery in passenger numbers in 2023”.
The retailer added: ‘Looking ahead, the group is well positioned as we enter our busiest summer trading period.
“Good business momentum continues across all three travel divisions and we are in a strong position to capitalize on significant growth opportunities in our markets.”
WH Smith has been strengthening its presence in transport hubs and hospitals, both of which have high levels of footfall.
It said the ongoing “transformation” of the business into “a one-stop shop for travel essentials” is generating “strong results, increasing average transaction values and returns”.
Russ Mould, investment director at AJ Bell, said: “WH Smith exploits a captive audience – people who want something but can’t compare prices because there are few alternatives or they don’t have time if they’re about to catch a plane or train.’
In some of its flagship stores, WH Smith has introduced Toys R Us concession sections.
In May, WH Smith unveiled the first 17 locations for the next tranche of Toys R Us stores that will launch within its stores over the summer as the children’s chain’s revival accelerates.
The high street group, which has already opened nine Toys R Us Shop-in-Shop stores as part of its retail partnership with the brand, will open a further 30 concessions by the end of August.
Three of the concessions – in Hereford, Herefordshire, Leamington Spa in Warwickshire and Fosse Park in Leicester – opened on 25 May.
The retailer’s decision to open the first concessions last year marked a comeback for the children’s chain after its collapse more than six years ago.
Victoria Scholar, chief investment officer at Interactive Investor, said: ‘Investors are enjoying a 3 per cent bounce in WH Smith shares today.
‘However, taking a step back, it remains a difficult time for its investors, with shares falling so far this year, underperforming the UK market.
“Longer term, performance has been equally painful: WH Smith has struggled to attract investors with shares still languishing more than 50 per cent below their pre-pandemic highs.”
