Profits before tax at WH Smith increased 8% in the 12 months to the end of August 2015, compared to the year before, with "colouring therapy" books helping to deliver a strong second half for the high street sector of the business. The group also noted that second-half book sales were "flat".
In preliminary results announced today (15th October) WH Smith reported a group profit before tax of £121m, against £112m in the 12 months to August 2014.
Its high street trading profit was £59m, up 2% from £58m the year before. Travel was up from £73m in the 12 months to August-end 2014 to £80m in the year to 31st August 2015. This is an increase of 10%.
Full year total sales in the travel wing were up 9% to £521m, with like-for-like sales up 4%. Second half like-for-like sales were up 5%. High Street sales were down 3% on a like-for-like basis with total sales down 4% to £657m.
WHS said like-for-like sales in physical books were down 2% for the year with the second half flat to last year. It said that kids book sales remained the most resilient category and its space allocation reflected market dynamics. WHS said its strategy around books was to improve its books operating model which helps to deliver margin improvements and efficiency savings. In e-books WHS said market growth of e-book content had slowed as e-book consumption “continues to migrate to apps on tablets rather than dedicated eReading devices”.
Stephen Clarke, group chief executive, said: "We have delivered a good performance across the group. Our travel business continues to perform well with strong sales across all channels in the UK, reflecting our ongoing investment and growth in passenger numbers. Internationally, we have made good progress in growing our sales and profit.
"In the High Street business, our profit focused strategy continues to deliver sustainable growth. In our core categories of stationery and books we had a stronger second half helped by the new phenomenon of 'colour therapy' for adults.
"The group is highly cash generative delivering a free cash flow of £109m and we have today announced a further share buyback of up to £50m and a 13% increase in the final dividend.
"This performance would not be possible without the ongoing hard work and commitment of all our colleagues across the business and I'm grateful for their continued support.
"Looking ahead, our focus will remain on profitable growth, cash generation, investing in new opportunities and evolving our customer proposition, all to ensure we are well positioned for the future."