WH Smith's Chairman resigns as profits rise

WH Smith on Thursday reported a five per cent rise in half-year pre-tax profit driven by strong performance of its travel division.

WH Smith on Thursday reported a five per cent rise in half-year pre-tax profit driven by strong performance of its travel division.

At the same time the books and stationary retailer announced the retirement of Chairman Walker Boyd. He will step down on August 31st and be succeeded by Henry Staunton who is the Senior Independent Director. Drummond Hall will take over from Staunton.

Boyd said he felt "the end of the current financial year would be a good time to hand over to a new Chairman".

The retailer posted profit before tax of £69m in the six months ended February 28th, up from £66m the year earlier, but fell slightly short of the £70m predicted by analysts at Deutsche Bank.

The group raised its interim dividend by 13% to 9.4p as earnings per share rose 11% to 44.2p. Gross margin improved by 160 basis points.

Results were boosted by trading profits of travel which grew 7.0% to £29m as further progress was made in the division's international channel with 121 stores open and a further 30 kiosks in China.

The travel business operates 619 stores, mainly in airports, railway stations, motorway service areas, hospitals and workplaces, primarily in the UK. It sells mainly a range of reading materials, food and drinks for people on their journey.

The High Street arm, which sells stationary, books and news, saw profits rise 2.0% to £48m as the group delivered cost savings of £9.0m.

"Both businesses continue to increase profit year on year, despite the challenging economic environment," said Group Chief Executive Kate Swann.

"The group remains highly cash generative enabling us to invest in our businesses and in new opportunities, whilst returning cash to shareholders. So far this financial year, we have returned £28m to shareholders through the share buyback announced in August 2012.

"We expect the trading environment to remain challenging however the business is in good shape and is well positioned for continued growth in both the UK and internationally."

RD

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Most Popular

Why we won’t see a house-price crash in 2021
House prices

Why we won’t see a house-price crash in 2021

Lockdown sent house prices berserk as cooped up home-workers fled for bigger properties in the country. And while they won’t rise quite as much this y…
18 Jan 2021
Prepare for the end of the epic bubble in US stocks
US stockmarkets

Prepare for the end of the epic bubble in US stocks

US stocks are as expensive as they’ve ever been. How can you prepare your portfolio for a bubble bursting?
18 Jan 2021
The best investment trusts to buy for 2021
Investment trusts

The best investment trusts to buy for 2021

Sectors ranging from emerging markets to student accommodation look poised to do well this year, says David Stevenson, as he picks the best investment…
19 Jan 2021