W H Smith’s book sales fell 7% in the first six months of its financial year, but the retailer said it has seen some “encouraging results” for its new high street book offer for customers.
Sales and profit at W H Smith’s High Street arm were down in the period, with profit falling 6% to £50m, while like-for-like sales were down 4%.The company said the results were “as expected” following a challenging books market over Christmas.
As usual W H Smith’s Travel arm performed better, with Trading profit up 5% to £41m, while revenue was up 3% on a like-for-like basis, driven by investment and ongoing growth in passenger numbers.
Overall, group profit decreased by 1% on the prior year to £91m.
Stripping out the books category specifically, sales were down 7% in the period, although gross margin was up in comparison to last year. The chain put the decline down to a “challenging” Christmas period with no new book trend following the success of colour therapy and spoof humour books for the preceding two Christmas periods.
“Our approach to the books business is to focus on areas of market growth, build on our relative strengths and drive the overall net profitability of the category,” the retailer said.
Earlier this year the chain unveiled a new books strategy designed to “futureproof” sales for the next decade, which on Thursday (12the April) the company said was “seeing some encouraging results”.
However, it added: “We continue to look at how we can improve the efficiency of our books operating model, both in store and across our distribution and supply network, and expect to deliver further cost efficiencies in this area going forward.”
In Travel, the firm’s standalone book store format was making “good progress”, with the next such store to open in London Bridge in May, as previously reported by The Bookseller. In addition, the company continues to strengthen its recommendation credentials with in store promotions and book clubs which are “key” for customers in both Travel and High Street, it said.
Stephen Clarke, group chief executive, added: “These results are only possible through the hard work of all of our teams across the business and I am very grateful for their hard work and support.
“While there is some uncertainty in the broader economic environment, we have made a good start to the second half of the financial year, increased the interim dividend by 10% and are confident in the outcome for the full year.”