WHSmith is eyeing several former Woolworths stores as it seeks to extend its portfolio by 44 shops by the end of its financial year in August.

The books to stationery retailer will open 10 high street stores and 32 travel shops by August to add to its total portfolio of 807 stores.

This week, WHSmith reported group like-for-like sales dropped 5 per cent in the 20 weeks to January 17, but that margins increased. Its high street like-for-like sales fell 7 per cent, while its travel like-for-likes slid 1 per cent.

Last year WHSmith strengthened its travel division with the acquisitions of 72-strong hospital store group UNS and 23 airport units from Alpha Airports. The retailer said that sales outperformed dwindling passenger numbers.

Group chief executive Kate Swann said trading conditions on the high street were “challenging over the Christmas period”. She added: “We continue to successfully deliver our strategy and maintain operational flexibility, increasing gross margins and accelerating our cost reduction plans. We are pleased with the progress in our travel business, despite the expected weaker passenger numbers in air.”

WHSmith said gross margin “improved strongly year on year” as it continued its ongoing policy of moving out of the less profitable entertainment category, with high street climbing 200 basis points and travel up 60 basis points. The retailer also said it is continuingly looking at staffing levels across the business.

Excluding entertainment, like-for-likes in the 20-week period slid 3 per cent. Entertainment like-for-likes plummeted by about 35 per cent, exacerbated by availability problems when Woolworths’ distribution arm EUK hit the buffers before the key pre-Christmas trading period.

Entertainment represented 10 per cent of WHSmith’s business in the last financial year. This figure is expected to eventually drop to mid single digits.

Swann said: “We expect consumer spending in our markets to remain subdued and we have planned accordingly.”

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