WH Smith in talks to cut 1,500 jobs
Book and stationery retailer WH Smith has said it has taken the difficult decision to launch a review of its store operations following the impact of the Covid-19 crisis.
The retailer is now starting a collective consultation on the plans which could lead to up to 1,500 roles becoming redundant.
The review will cover both WH Smith’s high street stores and shops in travel locations due to both businesses being hit by lower footfall.
Group revenue was down 57% in July although revenue has improved month by month since April when it was down 83%. In July, revenue at the retailer’s high streets stores and travel business was down 25% and 73% respectively.
WH Smith chief executive Carl Cowling said: “In our travel business, while we are beginning to see early signs of recovery in some of our markets, the speed of recovery continues to be slow. At the same time, while there has been some progress in our high street business, it does continue to be adversely affected by low levels of footfall.
“As a result, we now need to take further action to reduce costs across our businesses. I regret that this will have an impact on a significant number of colleagues whose roles will be affected by these necessary actions, and we will do everything we can to support them at this challenging time.”
WH Smith has begun a phased reopening of its travel stores since lockdown restrictions ended, although passenger numbers remain significantly down year-on-year. It is now trading from 246 of its largest stores which have historically accounted for around 75% of annual revenue.
While 203 high street stores that have Post Offices remained open throughout the pandemic, the retailer has now reopened 575 other stores that had temporarily closed.
Following the impact of Covid-19 in the second half of the financial year, the company now expects to deliver a headline loss before tax in the year to 31 August of between £70 million and £75 million.
Looking ahead, Cowling said:“While we are mindful of the continuing uncertainties that exist, we are a resilient and versatile business. The operational actions we are taking along with the financing arrangements that are in place, put us in a strong position to navigate this time of uncertainty and we are well positioned to benefit in due course from the recovery of our key markets.”
