Under new CEO Carl Cowling, the retailer has been named worst on the high street for two years in the Which? polls in 2018 and 2019 are now looking at global expansion. In particular, the US airport arm, including InMotion’s tech stores, is booming. Profits from this business will surpass those from the UK high street this year. The company saw revenue for the year rise from £886m to £1.4bn, with a profit of £73m compared to a loss of £55m last time. Cowling says the business is “in the strongest position it has ever been as a global travel retailer with multiple growth opportunities around the world”. WH Smith still has 530 high street stores, but analysts say the company will focus investment on its travel arm. In the UK, the health and beauty offer will be extended to London train stations such as Paddington. This gives Boots some serious competition. Today’s statement said: “We will trial the one-stop-shop format for Rail travel essentials at eight other major Network Rail locations, including London Paddington, London Victoria and London Liverpool Street stations. In these stores, we will invest in new store layouts and strengthen the space provided in categories such as health and beauty.” In the US, local airport stores are now a serious rival to the flagship Hudson News brand, which is increasingly seen as outdated by retail observers. Tesco and M&S are among the litany of British retailers that have made bold moves into the US market and failed. WH Smith is confident enough to resume dividend payments, which were suspended during the Covid crisis which severely curtailed travel. A final share split of 9.1pa will be paid. The strength of US business and the weakness of the pound flatter the results somewhat. Broker Peel Hunt raised its forecast, saying: “The upgrade is currency-driven but should please the market in the short-term: over the long-term we believe this is a top-quality business that warrants a much higher multiple as contracts are won.” Shares were up 27p at 1314am, valuing the business at £1.7bn.
