WH Smith has returned to profit after overcoming the challenges of the Omicron variant of Covid. The Swindon-headquartered retailer said it has its travel shops to thank for the turnaround in its fortunes.
Before tax, profit was £18m in the six months to the end of February, compared with a £38m loss in the same period a year ago. The company said in November it was well positioned to return to "meaningful profit" in 2022.
Chief executive Carl Cowling said the group had delivered a "good performance".
“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," he said.
The travel business, which runs shops in airports and railway stations, reported a 125% rise in revenue to £338m over the six months. In the UK, which is WH Smith’s biggest travel market, revenue in the unit was up 139%.
During the first few months of the financial year travel had been steadily improving, but was hit by the emergence of Omicron. The business said it continued trading and anticipated the variant’s impact would be short-lived.
“Since February, as travel restrictions have been further eased, we have seen the recovery in our travel markets continue, with a strong performance over the Easter holiday period,” it said.
Bosses said they plan to invest in new travel shops as the market recovers and have 125 new sites in the pipeline.
Revenue from WH Smith’s high street shops remained unchanged at £270m.
“Our high street business delivered a resilient and profitable performance in the period, despite the challenges facing the UK high street,” Mr Cowling said.
“During the period, our online businesses continued to perform well against a strong pandemic-related performance in the prior year. 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.
“We have improved the scale and footprint of the business and are operationally stronger than prior to the pandemic.”
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