By Scott Kanowsky
Investing.com — Shares in WH Smith PLC (LON:) fell in early European trading on Wednesday after the U.K. retail chain said sales at its high street business in the final weeks of its fiscal year remained below pre-pandemic levels.
In a trading update, the FTSE250 group reported revenue at the division at 82% of 2019 figures during the 11 weeks to August 27. WH Smith said a cyber attack on its online greeting card business, funkypigeon.com, “adversely impacted” performance at the unit.
The company added it is aiming to institute cost cuts at the high street business, mainly through reductions in rent.
However, total revenue came in well above pre-pandemic levels during the period, thanks mainly to strength in its key travel business.
Group sales were at 117% of the same period in 2019. The uptick adds to gains made in the 15 weeks to June 11, when WH Smith reported revenue greater than pre-Covid numbers for the first time.
The company, which operates more than 1,100 stores in hubs across the world, said its travel unit has seen demand surge as more passengers return to airports following the lifting of Covid restrictions. The increase has helped offset “some ongoing disruption” throughout the summer travel season, WH Smith said, with sales in the division at 135% of 2019 levels.
“As passenger numbers continue to recover, we have delivered strong [average transaction value] growth and higher penetration, driven by our ongoing strategy to significantly enhance our ranges and develop our categories, such as health and beauty and technology,” WH Smith added.
The firm confirmed its guidance for full-year income to “be in line” with the higher end of analysts’ expectations of £65M – £72M, although this would still be far below the £155M profit it registered in August 2019.