Retailer’s ceo reveals group has no plans to expand current estate
WHSmith is happy with its “very healthy High Street business” and has no plans to expand its current 550-store estate.
The revelation came from ceo Carl Cowling in an interview with the BBC World Service Marketplace Morning Report, in which he said the 230-year-old British retail stalwart’s biggest growth market is the US where it has captured about 12% of the retail market in US airports, and his ambition is to reach 20% over the next four years.
Carl told the BBC on Friday, 30 June: “We’ve got a very healthy High Street business in the UK but we’ve got no ambitions to grow that,” adding that to open any more than its current 550 stores “would just be a duplication” as the retailer is already present in the main cities across England, Wales and Scotland with its offer of greeting cards, stationery, books and convenience products.
Although WHS recently launched its Curi-o-city retail store concept to go after former Paperchase customers in Britain, and has the online greetings platform Funky Pigeon, the Travel arm is the main growth area with the upbeat trading statement on 31 May reporting a 31% rise in revenue in the 13 weeks to 27 May, following on from the group’s £63million profit before tax in 2022.
Over the past 20 years, WH Smith has expanded its presence in airports, train stations, motorway service areas and US-based casino resorts, and Carl said it will spend about £120m this year opening shops in America and Europe – 30 in North America in the first half of this financial year with another 30 in the second half – and he said: “We’re constantly winning tenders in airports.”
Having twice been ranked among the UK’s worst High Street retailers by consumer group Which? in 2018 and 2019 for its messy shops, Carl told the BBC it continues to invest in its stores.
He cited the new retail partnership with Toys R Us which has seen the toy retailer reappear in the UK following its collapse into administration in 2018 with concessions opening in nine WHS outlets over the past month.
He added that the rise in interest rates has increased the costs of the company’s investments since the cost of borrowing is higher, and told the BBC it has to be considered following the acquisition of US travel retailers InMotion in 2018 and Marshall Retail Group in 2019, with the resulting debt from the purchases.
Carl said: “But our business has come out of the pandemic in a good place. We’re very cash generative, and we haven’t got a ceiling on our investments at the moment.”
