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WH Smith considers sale of high street business including more than 500 stores WH Smith considers sale of high street business including more than 500 stores
(about 4 hours later)
Retailer says it plans to explore ‘strategic options’ for the future of ‘cash generative’ arm of the companyRetailer says it plans to explore ‘strategic options’ for the future of ‘cash generative’ arm of the company
WH Smith is exploring potential options for its high street business, including a sale, the British retailer said. One of the world’s oldest retailers, WH Smith, has confirmed it is in talks to sell its city- and town-centre stores, which it has described as the “hub of the high street”.
The company was holding “secret talks” about the sale of its entire high street arm, which has more than 500 stores, Sky News first reported on Saturday. First established in 1792 in Little Grosvenor Street in London by Henry Walton Smith and his wife, Anna, it expanded to become one of the UK’s best-known retail chains. Company bosses said this weekend they were exploring “potential strategic options”, including a possible sale.
Responding to the reports, the group said: “WH Smith confirms that it is exploring potential strategic options for this profitable and cash generative part of the group, including a possible sale.” The potential sell-off of about 500 high street stores, first reported by Sky News, is being explored as WH Smith concentrates on its global travel retail business focusing on transport hubs, which operates across 32 countries. The high street stores employ about 5,000 staff out of a total retail workforce of about 13,870.
The company said there was no certainty that any agreement would be reached, and that it would provide updates on the process “as and when appropriate”. The company said: “WH Smith confirms that it is exploring potential strategic options for this profitable and cash generative part of the group, including a possible sale.
The high street arm of WH Smith is part of the retailer’s more profitable travel business. Its high street business now accounts for only about 15% of annual group trading profit. “Over the past decade, WH Smith has become a focused global travel retailer. There can be no certainty that any agreement will be reached, and further updates will be provided as and when appropriate.”
“Over the past decade, WH Smith has become a focused global travel retailer,” the statement continued. Over the years a string of retailers have disappeared from the high street, including Woolworths, British Home Stores and Comet. WH Smith says its high street business is successful, with £452m of revenue in 2024 and £32m of profit.
“The group’s travel business has over 1,200 stores across 32 countries, and three-quarters of the group’s revenue and 85% of its trading profit comes from the travel business. WH Smith grew rapidly in the 19th century, building a newspaper distribution business with the expansion of the railway network. It opened its first retail travel store in Euston station in London in 1848.
“There can be no certainty that any agreement will be reached and further updates will be provided as and when appropriate.” The company now operates about 1,290 travel stores across the globe, with shops mainly in airports, railway stations and hospitals. Its travel business accounts for about three-quarters of the group’s revenue of about £1.9bn in the year to 31 August 2024.
The group reported underlying pre-tax profits of £166m for the year to 31 August – up from £143m the previous year. The high street business faces tough competition from online sales and has become a small part of the overall group. It now only accounts for about 15% of full-year group profit, with the group’s most recent accounts stating “our high street division delivered a good, profitable performance and continues to generate cash allowing us to invest across the group”.
But earnings remained flat at £32m in its traditional high street business despite a 2% drop in like-for-like sales thanks to cost-saving efforts. The firm says its high street stores have supported generations of customers, with newspapers, books, stationery, cards and gifts. Its website states: “We’re proud to help people discover new passions and today we’re proud to be the hub of the high street.”
Sky News reported that the listed company, with a market capitalisation of almost £1.5bn, has been in talks with a number of prospective buyers for several weeks, with investment bank Greenhill appointed to run the sale process. It said there had been questions about the future of WH Smith’s high street division for years as other major chains disappeared.
Carl Cowling, the chief executive of WH Smith, told the BBC in June 2023 that it would not be opening any more UK high street stores. He said it would focus on UK airports and train stations, as well as opening shops in the US and Europe.
The firm closed 14 of its high street stores in 2023 and said it would only renew store leases “where we are confident of delivering economic value over the life of that lease”. It was reported on Monday that WH Smith is to close 17 stores across the UK this year, including outlets in Greater Manchester, Luton, Basingstoke and Bournemouth.
In 2006, the firm “demerged” its news distribution arms, now Smith News, into a separate listed company.
Analysis by the Centre for Retail Research, a firm that provides analysis and research of the retail sector, found 13,479 stores closed across the UK in 2024, an increase of 28% on 2023. The centre has described the retail sector as in “permacrisis” since 2008 and is forecasting more than 17,000 store closures this year.