WH Smith upbeat on profits despite fall in sales
Book and stationery retailer WH Smith has reported a decline in sales over the Christmas trading period although improved margin and tight cost control helped underpin profits.
In the 20 weeks to 20 January 2013, the group’s total sales were down 4% with like-for-like sales falling by 5%.
Kate Swann, group chief executive, said: “During the period we saw a good profit performance across the group. Margin was well managed and costs were tightly controlled throughout the business.”
In WH Smith’s high street stores, total sales fell by 5% while like-for-like sales dropped by 5%. However, gross margin improved strongly in the period and costs were tightly managed.
In the travel business, which includes stores in railway stations, airports and motorway service areas, total sales were flat with like-for-like sales down 4%. There was a further improvement in gross margin and the new store development programme continued to progress well. The retailer said it had identified further opportunities for growth both in the UK and overseas.
Swann added: “Looking ahead, we expect the trading environment to remain challenging however we are a resilient business with a consistent record of both profit growth and cash generation, and are confident in making further progress in the year.”
