WH Smith hailed its resilience today as departing chief executive Kate Swann continued the retail chain's focus on profitability over sales.

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Like-for-like revenues fell 5pc in the 20 weeks to January 20 but with close management of margins and costs the company said it still delivered a "good" profits performance for the period.

It is a formula that has worked well for the company, which operates around 618 stores on the high street and another 619 at travel sites such as airports, train stations and motorway service areas.

Shares rose more than a third last year and opened 1pc higher today as analysts backed the company's strategy.

In October, WH Smith's profits lifted 10pc to £102 million, compared with the £135 million loss it made in 2004 prior to Ms Swann's appointment. The figure is expected to rise to £106 million in this financial year.

Ms Swann has shifted the company's focus away from lower-margin CDs and DVDs towards books and stationery, as well as reduced its dependence on the Christmas season and the need for heavy discounting.

However Ms Swann disappointed investors in October by announcing plans to leave the group. She will hand over the reins to Steve Clarke, who is managing director of the high street division, having joined the group in 2004.

Ms Swann said she expected trading conditions to remain challenging but that the company's resilience and profits record meant she was confident of further growth.

Seymour Pierce analyst Kate Calvert said: "We believe there is still plenty of growth to go for, particularly in travel and internationally, and the high street business market position is probably strengthening given recent administrations as there become fewer places to shop on the high street."

3 comments

  • All these shops that are in trouble on the high street all seem to have one thing in common. They specialise in one main area, hmv -cd's and dvds , jessops- cameras,wh smith - books . The biggest problem for all the above is you can buy books,cd's and cameras anywhere I cant see niche shops being around at this rate I blame tesco

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    david106

    Wednesday, January 23, 2013

  • The only one to blame is the public and the culture change in shopping ... More so when like now spendable income is under so much pressure... So you go and shop where things are cheapest... That said the Internet will close many shops in the next few years ... The high street shops have to pay high council business rate .. The Internet sites do not have that amount of expense ... With 3 to 5 million sales per day lost from uk high streets to the Internet ... It is basic logic that many shops will struggle to create enough viable profit to stay open ... 5 years time will probably see big changes to many high streets ... Incomes are now stretched far to much for more and more people and sadly more shops will disappear in coming years... Supermarkets and online shopping and poundland cheap shops will just grow untill the Internet shopping society bonanza levels off . As the Internet saves, time, money, effort and petrol and often free delivery .. It's a no brainier to the growing amount of people that buy whatever they do buy on line ... as we know ... Time changes everything ..!

    Report this comment

    Lionel

    Wednesday, January 23, 2013

  • "The biggest problem for all the above is you can buy books,cd's and cameras anywhere I cant see niche shops being around at this rate I blame tesco" @david106 Only Tesco? Not Amazon, eBay, Apple or online services supplying subscriptions to extra television channels, downloadable music or e-books?

    Report this comment

    Musto_Fan

    Wednesday, January 23, 2013

The views expressed in the above comments do not necessarily reflect the views of this site

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