WHSmith half-year profits crash 21% after InMotion acquisition

// WHSmith half-year profits crashed 21% after acquiring US retailer InMotion
// A restructuring programme has also impacted WHSmith’s costs
// Pre-tax profits dropped from £82m to £65m in the 6 months to February 28

WHSmith has said its half-year profits crashed after the acquisition of US travel accessories retailer InMotion and a restructuring programme.

The British retailer saw half-year profits fall 21 per cent after it was affected by costs, as pre-tax profits dropped from £82 million to £65 million in the six months to February 28.

WHSmith booked £9 million in costs linked to the deal to buy InMotion, and another £7 million linked to restructuring.

The retailer proposed a cost-saving programme in October, which would mean a handful of UK high street stores could shut as the company focuses on growth opportunities in airports and railway stations.

Meanwhile, sales rose eight per cent to £695 million, or one per cent on a like-for-like basis.

WHSmith’s travel division saw its total revenue rise by 18 per cent and three per cent on a comparable basis, while profit was up seven per cent to £44 million.

High street revenue fell one per cent, with like-for-like revenue down two per cent.

“The group has delivered a strong performance in the first half of the financial year,” WHSmith chief executive Stephen Clarke said.

“The integration of InMotion is progressing well. This acquisition doubles the size of our business outside of the UK, where we are now present in 99 airports and 30 countries.

“While there is uncertainty in the broader economic and political environment, we have made a good start to the second half of the financial year and the increase in the interim dividend by eight per cent reflects the board’s confidence in the outcome for the full year.”

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