Proactive Investors - WH Smith (LON:SMWH) pre-tax profit more than doubles.
WH Smith PLC reported healthy growth in revenue and more than doubled pre-tax profit boosted by strong growth in its Travel business.
The retail and travel operator said revenue in the six months to February 28 rose 41% to £859mln from £608mln a year prior while pre-tax climbed to £45mln from £18mln.
The company highlighted strong momentum across its Travel business with significant recovery in passenger numbers, strong average transaction value growth, successful category expansion and further space growth.
It expects Travel to represent over 70% of group revenue and around 85% of group profit from trading operations by the end of this financial year.
Carl Cowling, Group Chief Executive said: “Travel UK, our largest division, has delivered a strong first half performance and has excellent growth prospects.”
“This performance has been driven by our category expansion, focus on average transaction value, the success of InMotion and our travel essentials one-stop-shop format,” he added.
WH Smith said total Travel trading profit in the period reached £47mln, a near five-fold increase on last year’s £10mln while High Street trading profit edged lower to £24mln from £26mln.
The company said it had a new store pipeline of over 120 stores won and yet to open in Travel, including 60 in North America.
Trading momentum has continued into the second with a strong start made ahead of the peak Summer period.
“Current trading is strong and we are ahead of expectations for the full year" said Cowling.
WH Smith declared an interim payout of 8.1p per share which it said reflected strong current trading and confidence in future prospects.
Jet2 raises profit guidance again
Jet2 PLC (LON:JET2) upped guidance for profits for second time in three months adding to the optimistic sounds coming out of the aviation industry.
Pre-tax profit for the year to March are now expected between £387mln-£392mln before currency movements.
In January, the travel and leisure firm told the City it would beat market forecasts at the time of £317mln and come in between £370mln and £385mln.
For the new financial year, Jet2 reported seat capacity for Summer 2023 is currently 7.2% higher than Summer 2022 at 15.26mln seats.
Forward bookings to date remain encouraging, with the mix of Package Holiday customers representing just over 75% of total departing passengers and 5 percentage points higher than Summer 2022 at the same point.
In addition, average load factors for Summer 2023 are currently 0.7 percentage points ahead of Summer 2022.
The company cautioned it continues to face input cost pressures including fuel, carbon taxes, a strengthened US dollar and wage increases, but said pricing for both package holiday and flight-only products remains strong and margins per booked passenger are encouraging.
With the over 40% of the Summer 23 season still to sell, Jet2 said it was too early to provide definitive guidance for profit for the coming year, but said it was “pleased with the current position.”
FTSE 100 seen little changed
The FTSE 100 is expected to edge lower in early exchanges following a lacklustre showing in the US overnight after a mixed bag of earnings.
Spread betting companies are calling London’s lead index down by around 6 points.
The Dow closed Wednesday down 80 points, 0.2%, at 33,897, while the Nasdaq Composite added 4 points to 12,157 and the S&P 500 was flat at 4,155. The small-cap Russell 2000 index gained 2 points, 0.1%, to 1,797.
In Asia, markets were mixed. In Tokyo, the Nikkei 225 index was up 0.3%. In China, the Shanghai Composite was down 0.5%, while the Hang Seng index in Hong Kong was down 0.1%.
Tesla fell 6% after hours in New York, after the electric vehicle maker reported lower first quarter profit hit by rising costs and a drop in average selling prices which saw margins plunge.
The electric vehicle maker posted total revenue in the quarter of US$23.33 billion, up 24% from US$18.76b a year prior, boosted by growth in vehicle deliveries although there was an adverse forex hit of US$0.8 billion.
But operating income decreased to US$2.66 billion in the quarter from US$3.60 billion a year ago resulting in a 11.4% operating margin down from 19.2% in 2022 and 16% in the previous quarter.
Profitability was also knocked by reduced selling prices, higher raw material, commodity, logistics and warranty costs and lower credit revenue.
GAAP net income fell 24% to US$2.51 billion from US$3.32 billion.
Back in London and the early focus will be updates from Rio Tinto (LON:RIO), Segro, Rentokil, AJ Bell, and Dunelm (LON:DNLM).