Retailer WH Smith, which is exploring a potential sale of its UK high street business, has today reported a 4% rise in group revenue for the 21-week period to January 25, supported by strong growth in its travel division, sending its shares up 7%.
WH Smith's travel business, which has around 1,200 stores across 32 countries, is thriving even though retailers in general face pressure from inflation and consumers' curbing non-essential spending.
Last week, WH Smith said it was exploring potential strategic options for the UK high street business, including a sale.
"There are hopes that buyers will be found to remove what's been more of a burden than a diversified blessing," Susannah Streeter, head of money and markets, at Hargreaves Lansdown said.
The travel division, the company's largest, produced a 7% revenue increase in the 21-week period. WH Smith said its new food and extended health and beauty ranges was driving further profitability.
The company said it planned to open 60 new stores in North America where like-for-like revenue rose 3% in the 21-week period.
"Investors are enthused by the travel arm's continued success," Streeter said.
Analysts predict that following an increase in Britain's minimum wage the outlook for the travel industry has improved, and consumers will have more cash to spend on dining out and holidays.
They also expect retailers to benefit from consumers indulging in small treats, buying paperbacks, or purchasing electronic essentials while travelling.
The retailer, which is focused on becoming a one-stop-shop for travel essentials across airports and railway stations, said: "We have made a good start to the financial year and, while there is some economic uncertainty, we are confident of another year of good growth in 2025."
