WH Smith expects to hit full year targets as first Italian shops open
Updated : 08:58
WH Smith said results for the year to the end of August should hit target and that it continues to see further opportunities for international growth in via the airport market.
The Travel division, which operates outlets in train stations and airports, delivered a strong performance for the year and saw the first three Italian stores opened in Rome's Fiumicino and Ciampino airports, and one in Turin.
The FTSE 250 company reported "good" sales across all channels and a new store opening programme both in the UK and internationally that remained in line with plan.
"We continue to see further opportunities in the international news, books and convenience travel market."
The High Street business continued to perform in line with expectations, with the only further line in the short trading update on Wednesday being that cost savings and margin improvements "have been delivered in line with our profit focused strategy".
The fourth quarter followed a third that saw group sales up 2% with like-for-like sales flat, as the travel arm focused on airports and stations saw its gains wiped out by declines from the high street division.
In the fourth quarter of last year the retailer saw a LFL decline of around 5%, while in the travel arm quarterly LFL sales were up close to 4%.
WH Smith shares were modestly higher on Wednesday, still trading around all-time highs.
That shop openings have been back-ended bodes well for momentum going into the new year, said analyst Kate Calvert at Investec, with the company "evolving into a play on the structurally growing global travel retail market".
"WH Smith is set to see a sustainable step up in its Travel growth. The company has gained critical mass in several major geographies (Middle East & Australia). In addition, it is starting to have its early contracts renewed and has recently won a number of ‘game changing’ contracts in Germany, Spain, Italy and Singapore," she said, forecasting full year profit before tax of £139.7m versus consensus of £139m.