WH Smith sales down but profit margins up
High street news and stationery retailer WH Smith has said its profitability is still improving despite a 9% slump in sales over the 20-week period to 20th January.
However, the company claimed that lower costs on its UK investment and higher margins meant that profitability was continuing to improve, an announcement that lifted its shares 3% in London.
“In a competitive period on the High Street we continued to deliver our strategy to improve profitability on our UK investment,” said chief executive Kate Swann.
“We increased the pace at which we are rebalancing the mix of our business towards our core categories,” she continued, a statement taken to mean that the retailer is getting back to its roots in selling newspapers, magazines and stationery – an activity in which it has a proven track record of UK investment and delivery.
The travel division recorded a like-for-like rise in sales of 4% over the 20-week period, with profit margins increasing in that division too. For the group as a whole, WH Smith’s sales were down 6%.
“As anticipated, we saw competitive trading in our markets, but we continued to deliver good profit performance in line with our expectations,” said a spokesperson.