Shares in FTSE 250 newsagent WH Smith (LON:SMWH) declined by 5.31% to 867.80p (as of 13:20 BST) as pre-tax profits dropped by 3% for the six months ended 29th February. Trading profits on the high street were down by 8% and revenues were 5% lower than during the comparative period, outweighing continuing improvement in the group’s travel arm.
CEO Carl Cowling commented: “The emergence of Covid-19 and the associated global pandemic has affected all of us in ways that were unimaginable only a short while ago. I have enormous admiration for how our colleagues across WH Smith have responded to these unprecedented times and I would like to thank them all.
“[…]There was very little impact of Covid-19 on our first half results, however inevitably the performance in the second half will be very different. During the first half, we continued to see strong sales growth in our Travel business with total revenue up 19%, driven by our ongoing investment and initiatives in our UK business and our growing international businesses. Trading profit in the first half was up 11%. Our recently acquired US business, MRG, continued to perform well and maintained its momentum of securing significant tender wins across major US airports. Our High Street business also performed well delivering Trading profit of £44m in the period.
“Since March, we have seen a significant impact on our business as a result of Covid-19, with the majority of our stores closed around the world. We were fast to react to the situation and issued new equity via a placing, raising c.£162m on 6 April 2020. We also secured an additional £120m of bank funding.
“We are a resilient and versatile business and with the operational actions we have taken including managing costs and the new financing arrangements, we are in a strong position to navigate this time of uncertainty and are well positioned to benefit in due course from the normalisation and growth of our key markets“.