WH Smith boss reverses no-deal Brexit stockpiling

The boss of WH Smith on Thursday said he will start selling some of the drinks, stationery and chocolate he stockpiled as Britain is now not expected to leave the EU until at least Halloween.

Chief executive Stephen Clarke said “we’ll have to unwind [the stockpiling] and build it again” to avoid products going off. WH Smith has spent about £5 million to also store extra pens, notepads and diaries in case of a disorderly Brexit.

Pre-tax profits at the retailer edged down 1% to £81 million for the six months to February 28 but that’s mostly because it now tends to make more money in the second half of the year, boosted by summer travel spending and back-to-school products.

WH Smith has been increasingly focusing on lucrative travel locations such as airports and railways stations. Sales at its travel arm grew 18% to £364 million, a big chunk of the increase coming from its £155 million acquisition of US airport chain InMotion last year. This lifted profits by 7% to £44 million.

Meanwhile, High Street revenues fell slightly, to £331 million, with a 2% fall in same-store sales. Profits were down 4% to £48 million. Despite this, it was the second best High Street trading performance in 10 years. David Walliams’s books have been flying off the shelves, Clarke said, as well as diaries and pencil cases.

Emma-Lou Montgomery, associate director at Fidelity Personal Investing, said of the retailer: “The big surprise though came from the High Street side. Stationery it might focus on, but stationary it is not — contrary to all expectations.”

WH Smith, known for its generous returns of cash to shareholders, on Thursday increased its dividend by 8% to 17.2p for the half year. Shares rose 2.4% to 24.5p.