WHSmith takes Omicron hit but bosses remain confident

Sales in the retailer’s travel division fell, with airports and railway stations hit, but high street stores had a better time.

WHSmith’s results show sales remain below pre-pandemic levels (Rui Vieira/PA) (PA Archive)

WHSmith has revealed that sales at its stores remain below pre-pandemic levels and those at travel locations including airports and railway stations fell in the final month of 2021 as the Omicron variant of coronavirus spread.

Bosses said high street stores have seen improvements compared with 2019 levels, although these fell in the first two weeks of January.

Chief executive Carl Cowling said: “Looking ahead, although we are seeing a small impact from the Omicron variant, we anticipate a resumption in the recovery of our travel markets over the coming months.

“We are well placed for the key trading period in travel this summer and the ongoing recovery in our markets.”

WHSmith has been hit heavily by various lockdowns and restrictions, along with the collapse of the travel market.

The company revealed that revenues in its travel division in September 2021 were only at 73% of 2019 levels, rising to a high of 94% in November before dropping back to 83% in December and the first two weeks of January.

Split out by location, its hospital sites performed the strongest, while at its air and rail sites recovery was tempered by the Omicron variant.

Airport stores, for example, were trading at just 42% of 2019 levels in September, rising to 71% by November, then falling to just 58% at the start of January.

Rail was more consistent, with sales at 74% of 2019 levels in October and November, before falling back to just 69% in December.

Despite the difficulties, the retailer opened 16 new InMotion tech stores in airports including Heathrow, Manchester and Edinburgh with 14 new sites due in time for the summer holidays. A pharmacy format was also opened at Euston station in London.

There was better news in WHSmith’s high street stores, with sales hitting 90% of 2019 revenues in December – beating sales figures in September, October and November. However, this fell back to 87% in the first two weeks of January.

The company did not give details on why sales have remained below pre-pandemic levels for the past four months, only revealing that online businesses “performed strongly” and the Christmas period ended “with a clean stock position”.

Its North American travel business held up better than the UK, with increased passenger numbers during the festive period, with bosses highlighting its Las Vegas sites in particular.

WHSmith added: “We have seen a small impact from the Omicron variant in January but, as elsewhere, we believe this will be short term.”