(qlmbusinessnews.com . Thurs 30th Jan, 2025) London, UK —
WH Smith has revealed a drop in High Street sales as the company considers selling 500 of its UK stores.
Sales for its High Street division fell by 6% in the 21 weeks leading up to 25 January, which included the crucial Christmas trading period. This represents a 3% decline compared to the same period last year.
Despite challenges in the traditional retail sector, the company reported strong growth in its travel retail division, which now accounts for over 85% of its profits. The travel arm operates 1,200 stores across 32 countries, including airports, train stations, and hospitals.
Shift Towards Travel Retail
Group Chief Executive Carl Cowling expressed optimism about the company's future: “The group is in a strong position, and while there is some economic uncertainty, we are confident of another year of good growth in 2025.”
The retailer, established 233 years ago, confirmed discussions about selling its High Street stores, which employ around 5,000 people. However, it assured that post offices within 195 of these locations would remain operational if the sale goes ahead.
Cowling highlighted the company’s ongoing success in the US travel market, with plans to open additional stores in major airports, including Orlando and Portland. WH Smith has secured contracts for eight stores at Orlando International Airport in Florida and plans to open 60 stores across the US in total.
High Street Challenges and Future Prospects
Julie Palmer, a partner at Begbies Traynor, commented on the company's strategic shift: “WH Smith's decision to exit the UK High Street after more than 200 years demonstrates the challenges of traditional retail.”
Palmer suggested that private equity firms may show interest in acquiring the High Street division but cautioned that success is not guaranteed.
“Finding a buyer willing to take on the challenges of the High Street may prove difficult,” she added.
Despite these challenges, WH Smith remained on track to deliver its target of £11 million in annual cost savings, with analysts predicting that the High Street business could fetch £100 million or more in the coming months.
As WH Smith continues to expand its travel business and navigate the evolving retail landscape, its next chapter may signal a significant transformation in the company’s storied history.
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