WH Smith suffers on High Street but thrives in travel

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Despite a solid Christmas and the switch by chief executive Kate Swann fromcompetitive low-margin products like DVDs and CDs to core items like magazines and stationery, the group's first-half same-store sales fell by 2%. In the latest six weeks the decline continued at the same rate.

Highlight of the group is its faster-growing travel division, which runs 433 kiosks and outlets at airports, stations and hospitals.

It produced 14% sales growth in the first half mainly through new openings with like-for-like sales edging ahead by 1%.

But on the High Street Smith's 546 stores saw a 3% fall in like-for-like sales. Swann said the chain had delivered £4 million of savings in the first half as she concentrated on logistics and information systems.

Book sales rose marginally, stationery was flat and newspaper and impulse sales fell by 2%.

Across the group, gross profit margins rose by 0.7% with emphasis on better sourcing of products and less stock left over to shift in the sales.

Pre-tax profits for the half-year to 29 February rose by 8% to £64 million. The dividend for the half goes up by 24% to 4.6p a share.

The group is also in the middle of returning £90 million to shareholders through a special dividend and share buyback.

Swann said: "The economic environment remains uncertain and, whilst we continue to be cautious, we are confident in the outcome for the year."