Travel division boosts WH Smith profits

The travel arm, which operates from 495 sites, lifted half-year operating profits by 15 per cent to 23 million as tight cost controls and better margins helped it overcome continued pressure on air passenger numbers.

Sales in the division were down by two per cent on a like-for-like basis but WH Smith said it continued to outperform the trend in passenger numbers.

Overall, group profits for the six months to February 28 rose two per cent to 62 million after a steady performance from the core high street business.

The division delivered operating profits of 47 million, unchanged on a year earlier and despite a four per cent fall in like-for-like sales.

This was in line with expectations after WH Smith rebalanced the mix of the business away from lower margin CD and DVDs and on to books, stationery and confectionery markets.

Like-for-like sales excluding entertainment products were down one per cent on a year earlier.

WH Smith's defensive qualities - with an average transaction cost of around 5 - has helped it weather the tough trading conditions.

Chief executive Kate Swann said: "Looking forward, we remain cautious about consumer spending and our plans reflect this. We are confident in the outcome for the full year."

The company underlined its optimism by offering a 13 per cent hike in its half-year dividend payment.