‘Consistently good’ High Street performance, Curi.o.city up to six stores and Funkypigeon brings in £32m
Strong sales and profit growth have boosted WH Smith’s full-year revenue to £1.7billion, thanks to its Travel arm’s performance, according to the greetings, stationery and convenience retailer’s latest results.
CEO Carl Cowling commented on WHS being “a highly cash-generative business” in the report released yesterday, 9 November, with preliminary results for the year to 31 August.
The headline figures give a 28% group revenue increase and show total Travel trading profit grew to £164million from £89m the previous year, increasing revenue performance by 43% to £1,324m from £927m, helped by increased footfall as global travel bounced back from the pandemic lows.
In the High Street division, trading profit dipped slightly to £32m from £33m, and revenue performance was down 1% at £469m from £473m, with like-for-like having increased 1%.
The report stated: “We saw a consistently good performance in High Street throughout the year, with the Christmas trading period flat year on year on a LFL basis,” adding that the headline trading profit was “in line with expectations”.
The recently-launched premium greeting card, souvenir and gifting brand Curi.o.city is said to demonstrate how the group is “able to adapt, innovate and create a bespoke, localised brand and product offer”, with six stores now open in Gatwick airport, Bristol airport, St Pancras station and Selfridges in Birmingham and Manchester.
The concept also offers an “incremental sales opportunity” in locations where there is already a WHSmith store by selling high-margin categories such as souvenirs and fashion stationery, freeing up space in the traditional news, books and convenience stores.
The report added: “It is still early days, but we also see opportunities outside the UK with two Curi.o.city stores also due to open in Dubai later this year.”
The Funkypigeon.com online greeting card arm delivered a total revenue of £32m, £3m down on 2022, which was “as expected”, and the company said: “We continue to see opportunities to grow the platform further, growing revenue and profits over the medium term.”
The 231-year-old retailer said driving cost efficiencies remains a core part of the division’s strategy as it looks to deliver savings of £21m over the next three years – it was operating from 514 High Street stores at the end of August, compared to the 537 it had 12 months prior.
Around 480 leases are due for renewal in the next three years, including 100 where the company is already in negotiation with the landlords, and WHS said it only renews a lease “where we are confident of delivering economic value over the life of that lease”, and added that the planned savings include cheaper rents at lease renewal, which had been 50% on average over the last 12 months.
Carl added that its global travel business “is growing in all our key markets. It is highly scalable with multiple medium and long-term growth opportunities and we are seeing great results from sharing our expertise and innovation across our different geographies.
“Our North American business is benefiting from our forensic approach to space management which has always been a key feature of our UK Travel operations. In the same way, the ability of our North American business to provide bespoke retail formats is now being successfully harnessed outside of the US.
“We have started the new financial year well with total revenue in Travel UK up 13%, North America up 15%, and ROW up 27%. With good trading and very positive prospects, despite the uncertainty in the economic environment, we are confident in the group’s outlook for the new financial year.”
