Top story

WH Smith (SMWH) has said its full-year earnings will beat analysts’ expectations thanks to strong trading from its travel stores and better performance on the high street.

In a pre-close update for the year to 31 August, WH Smith said travel “continued to deliver a strong performance” during the second half. However, there was no mention of its recent row over airport VAT this morning.

It said the performance reflected investment in its key business initiatives and growth in passenger numbers and that its new store opening programme both in the UK and overseas remains on track.

Its high street stores are trading in-line with expectations with sales “slightly ahead” driven by favourable publishing in books. The retailer said it continues to “deliver gross margin improvements and planned cost savings in line with our profit focused strategy”.

It stated: “Accordingly WH Smith PLC expects the outcome for the year to 31 August 2015 to be slightly ahead of the consensus of analysts’ expectations.”

Morning update

Dutch retail chain Ahold today saw sales excluding petrol rise by 4.8% in the second quarter at constant exchange rate.

Total sales were €8.7bn, up 17.1% (up 3.1% at constant exchange rates), while net profit rose 33% to €195m from €147m in the previous year.

Sales in the Netherlands were up 6.8%, while sales in the United States excluding petrol were up 2.1%.

CEO Dick Boer said: “We had a strong quarter and are pleased with the financial performance across our business.”

It’s been another downbeat opening to trading this morning to go along with the miserable August weather. The FTSE 100 has opened 0.4% down at 6,380.6pts nearing its early January 2015 low.

WH Smith shares were down 0.8% to 1,557p in early trading this morning, while Ahold shares have jumped 4.3% to €18.25 so far today

Yesterday in the City

A tough day in the City saw the FTSE 100 plummet to its lowest level for seven months, falling 1.9% to 6,403.5pts on worries over the Chinese economy and the commodity markets.

The supermarkets were caught up in the sell-off, with Morrisons (MRW) down 3% to 246.2p, Sainsbury’s (SBRY) dropping 2.5% to 246.2p and Tesco (TSCO) falling 1.9% to 194.8p.

Other notable grocery fallers included Tate & Lyle (TATE), down 2.6% to 529.5p, PZ Cussons (PZC), down 2.4% to 318.1p and SABMiller (SAB), down 2.1% to 3,221.5p.

Glanbia shares were up 2.2% to 18.49 after reporting increased sales in its first half of 4.4% to €1.88bn yesterday.

Topics