Retailer WH Smith has hailed a “good start” to the new financial year amid a continued recovery in its travel stores and said it expects to return to profit next year.
It came as the company cut its annual losses by more than half as it was boosted by sales growth in its high street stores.
The company reported a group pre-tax loss of £104 million for the year to August, reducing its losses from £226 million last year.
Total revenues for the year dropped by 13% to £886 million compared with the previous year.
WH Smith’s high street business returned to growth over the year, although this was more than offset by lower sales from train station and airport shops amid reduced traveller footfall.
High street revenues increased by 4% to £485 million for the year.
The group said the high street retail business has continued to deliver a “robust performance” since the new financial year started in September.
Carl Cowling, group chief executive, said: “Despite the challenges of the UK high street, more generally, our high street business has delivered a resilient and profitable performance.
“Our online businesses have delivered strong growth in the year, including a record performance from funkypigeon.com.”
However, the firm’s travel business saw sales tumble by 27% to £401 million over the past year, with a 43% slump across its UK travel stores.
The retailer said it has seen “improving trends” within its travel arm, with sales for last month at 84% of the levels from October 2019.
Over the year the group expanded its airport technology stores businesses and said it has a “very strong pipeline of new store openings, with over 100 stores already won and due to open in travel over the next three years”, with the majority of these in North America.
Mr Cowling added: “The group has delivered a good performance in the evolving trading environment.
“We are a financially strong and resilient group with significant opportunities to grow.
“While we continue to plan with caution, the group is well positioned to capitalise on the recovery in our key markets and take advantage of the many exciting opportunities ahead.”
WH Smith also confirmed that it is set to open its first “frictionless” store in North America, using Amazon’s Just Walk Out technology from the retail giant’s cashier-less stores.
Mr Cowling told the PA news agency the store will be a trial and there are “no plans” for a till-free outlet in the UK.
Shares in the company were 0.5% lower at 1,606.5p on Thursday.