WH Smith has announced a further reduction in its pre-tax profit target for the current year, now expecting no more than £75m. This follows an earlier revision from an initial target of £105m to a range of £75m to £90m.
The company attributes the revised expectations to lower trading profit margins, driven by increased promotional activity, a reduction in brand marketing, and "inflation headwinds". These factors were partially offset by central cost reductions and lower interest costs.
The retailer's performance in North America has reportedly hindered overall growth, with like-for-like revenue in the region dipping by three per cent in the fourth quarter. North American airport stores saw a two per cent dip in like-for-like revenue due to lower passenger volumes and "softer consumer demand".
In contrast, WH Smith saw an uplift in UK like-for-like revenue growth, which jumped from two to four per cent in the fourth quarter. This was primarily driven by an eight per cent increase in like-for-like revenue from its hospital stores.
WH Smith stated it is making "good progress" on its turnaround plan, focusing on cost cutting, improved cash management, and boosting sales in its "travel essentials" range.