Analysts issued a wave of bullish notes on WHSmith’s prospects as the bookseller and stationer approaches its year end next Friday.

Higher disposable income will benefit low-ticket retailers such as WHSmith, said analysts, who also noted that capacity withdrawal as a result of the demise of Woolworths and weak comparisons will help sales growth.

UBS analyst Andy Hughes said WHSmith would suffer only a limited fallout from VAT increases because more than half the retailer’s sales are zero-rated or exempt, including products such as books and newspapers.

KBC Peel Hunt analyst John Stevenson said: “We are finally coming round to the point of view that the high street profit base seems well protected by longer-term margin initiatives and, in the short term, by further mix benefits and ongoing cost savings.”

He was also impressed by WHSmith’s growing travel arm and noted: “It is the international perspective that is likely to take centre stage over the next three years.”

Shore Capital analyst Kate Calvert said WHSmith is “one of the few retailers to deliver EBIT growth in the recession and we believe it is well positioned for this to continue”. She said the retailer
had “built a growth engine in its travel business and has rebuilt its high street business into a resilient cash cow”.

➤ WHSmith has promoted group marketing director Richard Cristofoli to its executive board.

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