WH Smith upbeat despite weak sales

The company said total group sales fell by one per cent in the 18 weeks to July 2, and fell four per cent on a like-for-like basis in the same period.

The high street division saw total sales drop by three per cent and like-for-like sales by four per cent, though the firm said gross margins continue to grow in both arms helped by costs savings.

Elsewhere, the travel business, which operates from more than 530 outlets at airports, train stations and motorway service areas, increased sales by two per cent, but once new openings are stripped out, like-for like sales fell by two per cent.

WH Smith’s strategy recently has been to cut out out products with low margins, such as CDs and DVDs, to focus on core areas of news, magazines, books and stationery, a move that has impacted sales but boosted profits.

Despite posting declining sales, the figures for the first 18 weeks of the second half, were an improvement on the whole of the first half, when travel like-for-like sales were down three per cent and high street sales were down six per cent.

The company said it opened seven international units for its travel business, which brings the total number of units to 47.

WH Smith said its financial position was in line with expectations and its balance sheet remained strong.

The group said: “The economic environment remains uncertain and while we continue to be cautious about consumer spending, we remain confident in the outcome for the full year.”