Partly Cloudy

Partly Cloudy

max temp: 2°C

min temp: -1°C

ESTD 1874 Search

Retail: WH Smith continues progress on margins despite dip in festive period sales

09:47 22 January 2014

WH Smith today reported further progress on improving its margins.

WH Smith today reported further progress on improving its margins.

Archant

WH Smith today shrugged off a tenth successive year of falling Christmas sales as it highlighted a “good profit performance” driven by a continued squeeze on costs.

Like-for-like sales were down 4% for the 20 weeks to January 18 and have been consistently negative for the period since 2005 but the retailer’s strategy of focusing instead on margins has won-over City analysts.

Its 615 high street stores saw a fall of 6% but WH Smith said there was good margin improvement and costs were tightly managed.

In the retailer’s travel division, which has 673 units at airports, railway stations and motorway services, like-for-like sales were down 1%, again with margin improvement, and a store opening programme progressing well.

The group said it had identified further opportunities for growth in both the UK and abroad.

It also began to deliver on its pledge of returning £50million of cash to investors, buying 1.6m shares at an average price of £9.57, after last year reporting annual profits up 6% at £108m.

Chief executive Stephen Clarke said: “During the period we have delivered another good profit performance across the group with costs tightly controlled and further improvement in gross margin.

“Looking ahead, we continue to plan cautiously and manage the business tightly while investing in new opportunities for future growth. We are confident in making further progress in the year.”

WH Smith slashed £18m of costs from its high street network during 2012/13 and has said it is targeting a further £22 million savings over the following three years.

The chain has weathered the downturn with the help of “impulse” offers such as a free bottle of water with the Telegraph newspaper, while shifting its focus away from lower-margin CDs and DVDs towards books and stationery.

WH Smith shares opened more than 2% higher today, with analysts at Cantor Fitzgerald Stockbrokers sticking by their forecast for profits of £108m in the current financial year.

Search hundreds of local jobs at Jobs24

0 comments

Residents say no to Anglian Water development at Ardleigh Reservoir. Photo: Steve Argent

Campaigners are objecting to a utility company’s plans for a new office building in a north Essex village.

An artist's impression of the Bombardier Aventra train that will operate from Liverpool Street to Essex and Ipswich,

One of the largest conglomerates in Japan has agreed to buy a 40% stake in the company running East Anglia’s passenger trains.

Jan Cavelle, founder of the Jan Cavelle Furniture Company, photographed in 2011.

Around 16 jobs have been lost at a specialist furniture manufacturer based in Suffolk.

ScottishPower's West of Duddon Sands offshore windfarm in the Irish Sea, off the coast of Cumbria, one of the company's 30 offshore installations already operational.

The East Anglia One wind farm project off the coast of Suffolk has taken another major step forward with the award of a contract to transport and install foundation “jackets” for the turbines.

Britain's Prime Minister Theresa May delivers a speech on leaving the European Union at Lancaster House in London.

A business leader said he was “underwhelmed” by prime minister Theresa May’s much-anticipated speech on Brexit today.

Management Jobs

Show Job Lists

Most read

Most commented

Topic pages

Streetlife

Newsletter Sign Up

Sign up to the following newsletters:

MyDate24 MyPhotos24