WH Smith in talks to sell high street stores

British retailer WH Smith is in talks to sell its high street stores, the business has said.

In a statement on Saturday the firm said that it was “exploring potential strategic options for this profitable and cash generative part of the group, including a possible sale”.

It went on to say that over the past decade, the business had become “a focused global travel retailer,” with more than 1,200 stores across 32 countries.

The first of its more than 500 stores opened more than 230 years ago, in 1792, operating as a news vendor. It has since grown into a major high street and travel retailer.

The travel retail business side of WH Smith, which operates from airports, train stations and hospitals, now accounts for more than 85% of its profit. The high street business makes up the rest.

The retailer said there was “no certainty that any agreement will be reached” but added it would provide updates on the possible sale.

WH Smith was valued at £1.5bn at the close of business on Friday. That figure represents the value of the entire group.

In 2019, a Which? best retailer of the year survey found WH Smith ranked the lowest, with shoppers describing the stationery specialist as “cramped and messy”.

Catherine Shuttleworth, a consumer retail analyst at Savvy Marketing, said shopping behaviour in the UK had “radically changed”, reducing the reasons to visit a WH Smith.

“Most of us read our news online not in magazines and newspapers, we download books and send birthday cards through online operators,” she said.

The focus for a business like WH Smith was now “in shops in high footfall areas like airports, stations and hospitals,” she added.

Nicholas Found, of the Retail Economics research consultancy, said potential buyers may see opportunities to “restructure and reimagine WH Smith’s high street presence”. He however warned that the modern high street was a “challenging climate” in which to operate.

Revenue from WH Smith’s high street stores dropped by £17m in 2024 compared with the year before, but profits stayed the same after the business closed 14 of its stores last year.

Speaking after WH Smith’s most recent financial results, group chief executive Carl Cowling said: “Our UK high street business continued to deliver its strategy of managing space to maximise returns and maintaining a flexible cost structure.

“As part of this space management, we opened 30 Toys R Us shop-in-shops in the second half of the financial year, and have agreed a further 37 to open ahead of Christmas 2024.”

Toys R Us went bust in 2018 and a deal was struck with WH Smith to host concessions.

In 2023, Mr Cowling told the BBC that the retailer would not be opening any more UK high street stores. Instead, it would focus on UK airports and train stations, as well as opening shops in the US and Europe.

Mr Found said it was clear that WH Smith had “strategically pivoted” towards the “fast-growing travel retail business”. Dropping its high street business, he added, would allow it to focus entirely on its new direction.