This week in retail: WHSmith takes centre stage as it issues pre-close update

The retailer has been helped this year by the craze for colouring books for grown-ups and associated spin-offs such as ‘extreme dot to dot’.

But there is nothing ‘kidult’ about WHSmith’s business performance.

The retailer, a target of satire for its supposedly poor in-store standards on feeds such as @WHS_Carpet on Twitter, has proved a past master when it comes to profitability.

When WHSmith issued interims in April it was able to celebrate the “best performance for many years” at its high street division as like-for-likes came in flat. Those colouring books helped deliver “particularly strong” stationery sales.

But when it updated again in June the high street business was down 3% like-for-like – likely a reflection of conditions in town centres rather than anything particular at WHSmith. Nevertheless, gross margin and cost savings were “in line with plan”.

At the flagship travel division, like-for-likes were up 3% at the time of the June update.

Food to go

WHSmith has highlighted the success of food to go over the past year or so, and that may feature again this week.

As consumption habits change, food to go is a rising star in retail and is allowing all sorts of businesses – such as Pret and Greggs as well as WHSmith – to grab a slice of the pie.

WHSmith’s travel locations are of course very well suited to demand for food on the go, so it will be worth keeping an eye on whether it is once again flagged as a good performer.

However, as the value of the pound remains an issue, could there be any impact on the travel division’s international operations in locations such as airports?

Will headlines about the rising cost of overseas holidays have had any effect, and what if any impact is the Brexit decision likely to have on business in Europe, which is “an area of focus” for the retailer?

However, WHSmith has a record of producing rabbits from hats. Whatever the sales trends, its enviable profit record speaks for itself and it is likely once again to reassure on the earnings front.