WH Smith to start closing stores as it struggles on the high street

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Retailer WH Smith has launched an overhaul of its under-pressure high street business as it revealed sliding sales and profits at the division.

The group said it has kicked off a detailed review of the high street business that will see it close six stores and wind down trials such as its online card arm Cardmarket and convenience store chain WH Smith Local.

The company plans to close the 20 Cardmarket stores as their leases come to an end, with affected staff transferring to nearby WH Smith stores. The group said it has kicked off a detailed review of the high street business that will see it close six stores and wind down trials.

The WH Smith Local franchises – which are run as concessions within independent newsagents and convenience stores – will be wound down as contracts come to an end.

WH Smith – which has 839 travel outlets and 610 high street stores in the UK – said the move was designed to ‘better structure the business for the future’

Shares in the company fell by more than 7 per cent in early morning trading.

The company will also see a restructure of some operational activities and a renewed focus on core ranges. One-off costs of the review sent group pre-tax profits down 4 per cent to £134 million for the year to August 31. It will also see a restructure of some operational activities and a renewed focus on core ranges.

But with these costs stripped out, underlying pre-tax profits rose 4 per cent to £145 million. WH Smith saw trading profits in its high street stores fall 3 per cent to £60 million, but this was offset by a 7 per cent rise in profits at its travel arm to £103 million. The group said high street like-for-like sales dropped 3 per cent, although it said the ‘slime’ craze helped drive an ‘encouraging’ performance in the final six months. Sales rose 3 per cent across its outlets based in airports and train stations.

Stephen Clarke, group chief executive of WH Smith, said: ‘We had a good year in high street despite the well documented challenges of the UK high street. ‘During an encouraging second half, the business traded well and we quickly identified the latest trend in the market, becoming a one-stop-shop for all slime-related products. ‘Despite this good performance, we are not ignoring the broader challenges on the UK high street and, during the second half, we conducted a business review to ensure our high street business is fit for purpose now and for the future.’