WH Smith shares were down 5.1% to 1,433 in late afternoon trading following the company’s release of its interim results, reporting a swing back to pre-tax profit of £14 million compared to a loss of £19 million in 2021.
The group reported a total travel trading profit of £10 million against a loss of £28 million the previous year, alongside a high street trading profit of £26 million from £24 million.
“The Group has delivered a good performance with a strong rebound in profitability. We have seen a recovery across all our travel markets despite the impact of the Omicron variant in Q2, and we are in a strong position to capture growth as the recovery continues,” said WH Smith CEO Carl Cowling.
The company said it had a new store pipeline of over 125 outlets in its travel sector, including 63 in North America and 31 in Spain.
The firm also noted 28 new InMotion technology stores across UK airports in its global rollout.
“We have opened 28 new technology stores in the UK under our InMotion brand, including our recently opened flagship store at Heathrow Terminal 5,” said Cowling.
“These stores have received excellent feedback from landlords and customers. Outside of the US and the UK, we have opened and won a further 11 InMotion stores across 6 countries and we see significant potential to grow the brand globally.”
The group added that it had £336 million in headline debt, with access to £315 million of liquidity, consisting of £65 million cash on deposit and £250 million undrawn revolving credit facility.
WH Smith confirmed continued recovery across its travel stores in its outlook for 2022, with its high street stores positioned to maintain cash generation across the company.
The group added that its low ticket-value categories and strong supplier relationships helped it in mitigating the impact of inflationary pressures.
“Looking ahead, we continue to invest in the business where we see attractive growth opportunities and have positioned the Group well to benefit from the return of passenger numbers,” said Cowling.
“We have improved the scale and footprint of the business and are operationally stronger than prior to the pandemic.”
“While there are some uncertainties in the broader global economy, the Group is well positioned to capitalise on the ongoing recovery in our key markets and take advantage of the many opportunities ahead.”