WH Smith recovers to pounds 38.6m profit despite weak sales growth

WH Smith signalled the start of a long-awaited recovery yesterday with a sharp increase in profits though sales growth is still among the weakest on the high street.

Announcing half-year profits of pounds 38.6m compared with pounds 17.3m last year, the chief executive, Bill Cockburn, restated that turning around WH Smith would be a four-year job but stressed that the company was moving in the right direction.

"The group has been focused on its core activities, management has been strengthened and efficiency has been improved," he said. "But until we can demonstrate that we can grow the business I think there will still be a reservation about our progress." He admitted that first-half sales growth was "not that good".

As part of the campaign to revitalise the core WH Smith chain, the group is testing a new blue logo on its shop fronts. The signage is on trial at a handful of stores and features an exclamation mark at the end of the name though this may be jettisoned. If successful, the new look will be rolled out to all stores and will signal the end of Smith's orange and brown identity.

Sales at the core WH Smith chain grew by just 1.5 per cent in the seven months to 30 November and at the same rate over Christmas. The number of product lines has been cut by 30 per cent and the number of suppliers reduced. This space will be used to develop more Discovery zones for children. These areas, which group together books, games and multimedia products, have been tested in larger branches and will be added across the chain over the next two years. Music will be added to a further 90 stores.

Mr Cockburn said WH Smith still had to improve stock availability, store layouts and the company culture to one that encouraged more innovation.

Group like-for-like sales grew by 2 per cent in the period. Of the remaining chains, Waterstones was the star performer with like-for-like sales 9 per cent higher and profits 23 per cent ahead at pounds 9.1m.

But Virgin Our Price performed poorly with sales 2 per cent lower. The group slid into a pounds 1.4m loss in the first half compared with a pounds 2.9m profit last time. Mr Cockburn blamed a poor roster of new album and video releases in 1996.

Of WH Smith's US businesses, its music chain, The Wall, increased losses to pounds 3.4m.

Group sales in the six months to 30 November were marginally lower at pounds 1.29bn due to disposals. The half-year dividend was maintained at 5.25p. The shares closed 4.5p higher at 434.5p.

Investment column, page 20

Suggested Topics
Start your day with The Independent, sign up for daily news emails
News
Kim Wilde began gardening in the 1990s when she moved to the countryside
peopleThe singer is leading an appeal for the charity Thrive, which uses the therapy of horticulture
Sport
Alexis Sanchez celebrates scoring a second for Arsenal against Reading
football
Life and Style
health
Voices
An easy-peel potato; Dave Hax has come up with an ingenious method in food preparation
voicesDave Hax's domestic tips are reminiscent of George Orwell's tea routine. The world might need revolution, but we like to sweat the small stuff, says DJ Taylor
News
i100
News
Japan's population is projected to fall dramatically in the next 50 years (Wikimedia)
news
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

Ashdown Group: Training Programme Manager - City, London

£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

Day In a Page

NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

Who's monitoring the outsourced NHS services?

A report finds that private firms are not being properly assessed for their quality of care
Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

How do Greeks feel about Syriza?

Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
From Iraq to Libya and Syria: The wars that come back to haunt us

The wars that come back to haunt us

David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

Too busy to surf? Head to The Pool

A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders
Heston Blumenthal to cook up a spice odyssey for British astronaut manning the International Space Station

UK's Major Tum to blast off on a spice odyssey

Nothing but the best for British astronaut as chef Heston Blumenthal cooks up his rations
John Harrison's 'longitude' clock sets new record - 300 years on

‘Longitude’ clock sets new record - 300 years on

Greenwich horologists celebrate as it keeps to within a second of real time over a 100-day test
Fears in the US of being outgunned in the vital propaganda wars by Russia, China - and even Isis - have prompted a rethink on overseas broadcasters

Let the propaganda wars begin - again

'Accurate, objective, comprehensive': that was Voice of America's creed, but now its masters want it to promote US policy, reports Rupert Cornwell
Why Japan's incredible long-distance runners will never win the London Marathon

Japan's incredible long-distance runners

Every year, Japanese long-distance runners post some of the world's fastest times – yet, come next weekend, not a single elite competitor from the country will be at the London Marathon
Why does Tom Drury remain the greatest writer you've never heard of?

Tom Drury: The quiet American

His debut was considered one of the finest novels of the past 50 years, and he is every bit the equal of his contemporaries, Jonathan Franzen, Dave Eggers and David Foster Wallace
You should judge a person by how they peel a potato

You should judge a person by how they peel a potato

Dave Hax's domestic tips are reminiscent of George Orwell's tea routine. The world might need revolution, but we like to sweat the small stuff, says DJ Taylor
Beige is back: The drab car colours of the 1970s are proving popular again

Beige to the future

Flares and flounce are back on catwalks but a revival in ’70s car paintjobs was a stack-heeled step too far – until now
Bill Granger recipes: Our chef's dishes highlight the delicate essence of fresh cheeses

Bill Granger cooks with fresh cheeses

More delicate on the palate, milder, fresh cheeses can also be kinder to the waistline
Aston Villa vs Liverpool: 'This FA Cup run has been wonderful,' says veteran Shay Given

Shay Given: 'This FA Cup run has been wonderful'

The Villa keeper has been overlooked for a long time and has unhappy memories of the national stadium – but he is savouring his chance to play at Wembley
Timeless drama of Championship race in league of its own - Michael Calvin

Michael Calvin's Last Word

Timeless drama of Championship race in league of its own