Magazine and book retailer WH Smith Plc (SMWH.L), Wednesday, in its trading update for the 21 weeks to January 23, reported a decrease in both total and like-for-like sales for the period. The group noted that the performance was in line with expectations and that it is confident in the outcome of the year.
For the 21-week period, total WH Smith sales dropped 2%, with a 4% decline in like-for-like sales. The London-based company operates mainly in two segments: High Street and Travel.
In High Street division, like-for-like sales for the 11 weeks to January 23 were down 5%, and like-for-like sales for the 21-week period decreased 4%. WH Smith attributed the declines to its strategy to rebalance the business mix towards its core categories. Excluding entertainment, High Street like-for-like sales for both the 11-week and 21-week period slipped 1%.
In Travel segment, total sales for the 21-week period increased 2%, whereas like-for-like sales were down 2%.
According to the company gross margins increased in both divisions and costs were tightly controlled.
In October 2009, WH Smith announced its intention to return up to GBP 35 million of cash to shareholders via a rolling share buyback program. The company said today it has purchased nearly 6.0 million shares to date at an average price of 512.941 pence as of January 22, 2010.
Going forward, chief executive Kate Swann said, "Although we remain cautious about consumer spending, we have planned accordingly and are confident in the outcome for the full year." The company intends to announce its interim results for 2010 on April 22, 2010.
As at August 31, 2009, WH Smith has 565 high street stores and 490 travel outlets at airport, train station, hospital, workplace and motorway service area locations mainly in UK. The company presently employs more than 17 thousand people.
SMWH is currently trading on the London Stock Exchange at 489.10 pence per share, down 0.90 pence or 0.18%, on a volume of 4,898 shares. In the past 52-week period, the shares have been trading in a range of 306.75 pence to 551.00 pence.
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