5th Aug 2020 10:01
(Alliance News) - WH Smith PLC said Wednesday that Covid-19 has continued to have a significant impact on trading, so much so that the books and stationery retailer is proposing a restructuring of operations that could lead to up to 1,500 job cuts.
WH Smith said that due to the impact of the pandemic on passenger numbers and lower footfall on the UK high street, it will review its store operations for both its Travel and High Street businesses.
In addition, following the impact of Covid-19, WH Smith expects to report a headline pretax loss for the year ending August 31 of between GBP70 million and GBP75 million, compared to a profit of GBP155 million in financial 2019.
Shares in WH Smith were up 4.6% at 1,030.59 pence on Wednesday in London.
WH Smith did note its situation has started to improve since April, with revenue for the month of July down by 57% year-on-year, compared to an 83% fall in April. However, sales have continued to be materially lower compared to the prior year.
In its Travel business WH Smith has started a phase reopening of its UK stores, and is now trading in 246 of its largest stores, which represents 75% of annual Travel revenue. In the US, WH Smith expects a faster recovery than in the rest of the world, with an encouraging performance from 147 stores that have reopened to date.
As for the High Street business, 575 stores have been reopened to date, even as high street footfall remains significantly lower.
Looking ahead, WH Smith said it has enough funds to allow it to operate throughout a prolonged downturn in markets, with GBP63 million in cash, a revolving credit facility of GBP200 million, and a committed bank facility of GBP120 million.
WH Smith will publish its annual results on November 12.
By Dayo Laniyan; [email protected]
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