'Passion' books set to make racy reading for WH Smith as it aims for £100m pre-tax profit

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The Independent Online

WH Smith chief executive Kate Swann will thank the hot demand for "passion" books, notably Fifty Shades of Grey, for a sizzling set of results this week.

Sales of the spicy titles could help the Swindon-based high-street chain, which has more than 600 shops, reach £100m in pre-tax profit in the year to 31 August.

That would be an 8 per cent increase on the previous 12 months and a sixth successive year of profit growth for the 220-year-old retail chain.

In a pre-close update in the summer, the FTSE 250 group cited an "improvement in the sales trend of books following the recent positive publishing schedule", referring partly to Fifty Shades of Grey – a bestseller in markets around the world – and similarly saucy books, such as Bared to You by Sylvia Day.

Less explicit recent bestsellers include those recommended by the celebrities Richard and Judy, such as Victoria Hislop's The Thread.

Ms Swann, WH Smith's chief executive since 2003, is likely to be quizzed on which of these titles are expected to sell strongly this Christmas, with publishers already tipping the celebrity chef Jamie Oliver's 15-Minute Meals to be a major success.

There should also be continued big sales of The Casual Vacancy, the first adult-aimed novel from Harry Potter author J K Rowling which is currently topping the fiction charts.

WH Smith will provide an update on Thursday about the progress of its latest £50m share buy-back programme after the completion of the company's previous scheme for the same amount in 2011-12.

Dan Homan, an analyst at Citi, said: "In each of the past five years, WH Smith had returned on average 11 per cent of its market capital through dividend and buy-backs."

Investors will be keen to hear about the group's plans for its fast-growing "travel" business, which are non-high street stores, such as those in airports, railway stations and hospitals.

The group is looking to expand this distinct division overseas, from India to Australia.

WH Smith's shares closed at 659p on Friday, which was up 1 per cent on the start of the day's trading and an increase of nearly 190p since June.