Good results despite fall in like-for-like sales
Stationery and magazine retailer WHSmith has revealed a 31 per cent jump in pre-tax profits to£51 million for the year to August 31, despite seeing high street like-for-like sales drop 7 per cent.

The company, which completed a demerger from its news distribution business last month, also said that overall revenue for its 542 high street and 127 airport stores had fallen 5.8 per cent to£1.34 billion.

WHSmith group chief executive Kate Swann admitted that trading 'remains subdued and we expect the Christmas season to be competitive and we have planned accordingly'.

In the five weeks to October 7 like-for-like retail sales were down 3 per cent and gross margin was described by the company as being 'up on last year'.

Swann added that the business had made£22 million in cost savings in the past year and that a further£15 million - mostly in logistics and IT - would be saved in the next three years.

'Despite tough trading conditions on the UK high street, [our high street division] has improved its profitability by 14 per cent and we continue to make progress in -rebuilding our authority in our core categories,' said Swann.

The company said it had conducted 'thorough reviews across all categories' in the past six months and has introduced fresh ranges in 70 stores.

It has also abandoned selling electronics in favour of devoting more sales space to extended food and snack ranges as well as books.

Like-for-like sales in books fell 5 per cent, were 4 per cent down in stationery and plunged 19 per cent in DVD and CDs due to an extremely competitive market.

Broker Numis said that the like-for-like growth of 3 per cent in the travel division was 'particularly impressive' and that there 'remains further room for gross margin improvement over this year'.