INTERIM RESULTS ANNOUNCEMENT

10 April 2014                                                                                                                          

 

WH SMITH PLC

INTERIM RESULTS ANNOUNCEMENT

FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014

 

Strong performance across the Group with EPS up 15% and interim dividend up 15%

 

 

Group Financial Summary

	6 months to			% change
	Feb 2014		Feb 20131
Group profit before tax Diluted earnings per share   Travel trading profit2 High Street trading profit2 Group profit from trading operations2	£69m  46.3p   £30m £49m £79m		£67m  40.3p   £29m £48m £77m	3%  15%   3% 2% 3%
Headline Group profit before tax3 Headline diluted earnings per share3	£70m 47.1p		£68m 41.1p	3% 15%

·   Interim dividend of 10.8p, up 15% on the prior year

 

·   Strong cash generation and balance sheet; free cash flow⁴ of £53m

 

·   Good progress with return of cash to shareholders; as at 9 April, 2.1m shares purchased and £21m of cash returned to shareholders

 

·   Group total sales down 4% with like-for-like (LFL) sales down 4%

o Travel total sales up 2% with LFL sales down 1%

o High Street total sales down 7% with LFL sales down 6%

 

·   Gross margin improved by 190 basis points

 

·   Good progress made in Travel's growing international channel with over 150 units now won

 

·   In line with latest plan, High Street delivered cost savings of £9m in the half, with a further £5m identified for the second half; on track for £14m of costs savings for the full year

 

Stephen Clarke, Group Chief Executive said:

 

"The Group has delivered another strong performance, with profit growth in Travel and High Street, demonstrating the continuing success of our strategy.

 

"The Group remains highly cash generative.  During the first half we returned £47m to shareholders through the dividend and share buyback announced in October 2013 and today we have increased the interim dividend by 15%.

 

"Looking ahead, we will continue to invest in new opportunities that position us well for future growth."

1 Restatedto reflect adoption of IAS 19 Revised (IAS19R) and to recognise IFRIC 14 pension liability and associated deferred tax asset. See Note 1 to the financial statements

2Group profit from trading operations and High Street and Travel trading profit are stated after directly attributable share-based payment and pension service charges and before central costs, interest and taxation. See Note 2 to the financial statements

3 Headline Group profit before tax excludes the non-cash income statement charge for pensions.  A reconciliation of Headline Group profit before tax to statutory Profit before tax is provided in the Group Income Statement on page 7

4 Net cash flow from operating activities adjusted for net capital expenditure, pension deficit funding, net interest received and settlement of contingent consideration provisions.  See analysis of cash flow (page 5)

 

Enquiries:

 

WH Smith PLC
Nicola Hillman	Media Relations	020 7406 6350
Mark Boyle	Investor Relations	020 7406 6320
Brunswick
Simon Sporborg / Laura Jack Hayes		020 7404 5959

 

WH Smith PLC's Interim Results 2014 are available at www.whsmithplc.co.uk. A copy of the Interim Results 2014 will shortly be available for inspection at the UK Listing Authority, 25 The North Colonnade, London E14 5HS.

 

FINANCIAL REVIEW

 

Group Summary

 

Group profit from trading operations² increased by 3% on the prior year to £79m (2013: £77m) and Headline Group profit before tax³ of £70m (2013: £68m), was an increase of 3% on the prior year. 

 

Total Group sales were £613m (2013: £638m) with LFL sales down 4%. Travel sales were up 2% compared to last year and down 1% on a LFL basis, reflecting a recent improvement in UK air passenger numbers. High Street sales were down 7% and down 6% on a LFL basis.

 

Travel delivered another strong performance with trading profit² increasing by 3% to £30m with further improvement in gross margin and good cash generation.  We continue to invest in the business and are on track to open 30 new units in the UK this year.  In our international channel we now have 118 units open with a further 38 yet to open, giving us a total of 156 units.  As at 28 February 2014 Travel operated from 701 units.

 

High Street delivered another good performance with trading profit² up 2% to £49m and high levels of cash generation. We saw a strong gross margin performance and costs were tightly controlled.  In line with our latest plan, cost savings of £9m were delivered in the half, with a further £5m identified in the second half. As at 28 February 2014 High Street operated from 607 stores.

 

Headline diluted earnings per share³ increased by 15% to 47.1p (2013: 41.1p)¹. This reflects the increase in profit, a lower basic weighted average number of shares in issue following the share buyback, and a decrease in the effective tax rate from 22%¹ to 19%.

 

The Group remains highly cash generative and has a strong balance sheet. Net funds were £18m at 28 February 2014, with a Group free cash flow⁴ of £53m. The Group has a committed multi-currency revolving credit facility of £70m through to January 2016.

 

On 10 October 2013 the Board announced a further £50m return of cash to shareholders through a rolling share buyback programme.  As at 9 April we have purchased 2.1m shares and returned £21m of cash to shareholders.

 

The Board has declared an interim dividend of 10.8p per share, a 15% increase on last year.

 

The increase in interim dividend reflects the Board's confidence in the future prospects of the Group, the strong cash generative nature of the business, and our progressive dividend policy.

 

We continue to invest in the business, including capital expenditure in the half of £19m, whilst consistently growing dividends and returning cash to shareholders as part of our long-term strategy to create value for shareholders. Including the share buyback announced on 10 October 2013 and the declared interim dividend, we will have returned £550m of cash to shareholders since our 2007 financial year.  We have done this through a combination of ordinary dividends, share buybacks and a special dividend.

 

Since 2006 we have reduced our issued share capital by 34% through the buyback programme and special dividend.

 

 

Financial Year	Ordinary Dividend5 £m	Buyback £m	Special  Dividend £m	Total £m
2014 2013 2012	39 34 31	506 50 50	- - -	89 84 81
2011	29	55	-	84
2010	26	35	-	61
2009	23	-	-	23
2008	21	33	57	111
2007	17	-	-	17
	220	273	57	550

⁵ Cash dividend paid and interim dividend declared

⁶ Buyback announced on 10 October 2013

 

 

Trading Operations

 

Travel

 

Travel delivered another strong performance with good cash generation.  Trading profit² increased by 3% to £30m (2013: £29m) with a further improvement in gross margin and good cost control. 

 

Total Travel sales were up 2%, with LFL sales down by 1%, reflecting some recent improvement in UK air passenger trends and our continued focus on space management.  Gross margin increased by 110bps during the period, primarily driven by active category mix management.

 

We continue to identify opportunities for growth and invest in new space in Travel and are on track to open 30 units in the UK this year, including all the CTN units at the new Heathrow Terminal 2.  In the first half we opened 7 units in the UK.

 

We continue to evolve our offer to meet changing customer and landlord needs while investing in new space and format development.  Category mix varies substantially by channel and even by location within a channel, so actively focussing on our category mix management enables us to best meet customer and landlord needs, improve service and efficiency, grow market share and drive margins. This has resulted in further changes to product mix and our customer offer, as we evolve our formats and trial new initiatives in each of our key channels. In air, we have invested in relaying stores, improving navigation and store design while also allocating additional space to growth areas such as, souvenirs, gifting, travel accessories, digital accessories and health and beauty essentials. In rail, customer needs are different and our space and category mix management reflect this. For example, we are currently trialling an increased food-to-go offer, combined with faster payment options for time pressed commuters.

 

In hospitals, where a large part of our customer base is hospital staff, we have also extended our food-to-go and convenience offer, particularly for the breakfast and lunchtime markets.  In addition in the hospital channel we continue to offer our operating expertise to partners, such as M&S Simply Food, where there is a mutually beneficial opportunity. During the half we opened 2 M&S Simply Food units in Bristol Royal Infirmary and Blackpool Hospital. We now have 4 M&S Simply Food units open, with further openings planned for the second half.

 

Our international units are performing well and we have invested in additional resources to develop the business and support further growth. We have now won 156 units in international locations including 15 new units announced today: in the International terminal at Bali; Pudong Airport, Shanghai; further stores in Russia; and additional Fresh Plus hospital cafés in Australia.  Additionally, we acquired a small cards and gifts franchisor in Australia in January 2014, Wild Cards and Gifts, which has 40 franchisees, enabling us to offer an additional brand to landlords and to develop further our international wholesaling.  In total, excluding the Wild Cards and Gifts franchisees, we now have 118 units open across four channels: air, rail, hospitals and malls.

 

The WHSmith brand and offer continue to be well received by customers and landlords and we have demonstrated that we can add value and deliver improved performance.  We continue to utilise our three operating models and, of the 156 units we have already won, 54% are franchise, 33% direct lease and the remainder are joint venture.

 

The Travel business now operates from 701 units, including motorway service area franchise units. 5 UK units were closed in the period, primarily due to landlord redevelopment.  We renewed 13 contracts and completed 20 refits during the half.  Excluding franchise units, Travel occupies 0.53m square feet.

 

 

High Street

 

High Street delivered a good profit performance, with an increase in trading profit² to £49m (2013: £48m), up 2% on the prior year. This was achieved by continuing to actively manage our space to optimise our core categories, margin mix and costs in order to deliver sustainable profit and good cash generation.

High Street sales were down 7% in total and down 6% on a LFL basis, reflecting some challenging markets and weaker publishing in the period. Gross margin improved by around 220bps, through rebalancing the mix of our business, better buying, improved sourcing and markdown management.

Optimal use of space is a fundamental part of the strategy for High Street, as we look to maximise profitability today in ways that are sustainable for future years. We work our space to maximise return on every metre drop in every store through improving margins, reducing costs and driving third party income opportunities. Each individual store has a specific space reconfiguration twice a year driven by many years worth of detailed space and product elasticity data.  In the half space changes have included the addition of a further 19 Post Offices, giving us 103 in total; a reduction in backlist fiction in some stores; and the addition of more space to seasonal ranges. Going forward, we will continue to manage space in this way.

Cost savings remain a core part of our strategy and we focus on all areas of cost in the business. We have made good progress in the half, delivering cost savings of £9m, with a further £5m identified for the second half, in line with our latest plan. These come from right across the business, including an evolving books operating model, more effective waste management in our distribution centres and more targeted marketing spend. We also have a number of initiatives on trial such as improved utilisation of technology to simplify and improve the efficiency of our store operating model.

The High Street business now operates from 607 stores, which occupy 2.96m square feet.  8 stores were closed in the period.

 

Category Performance

 

Stationery:

Our strategy to build on our market leading position in Stationery remains unchanged. Like-for-like sales were down 2%, with gross margin up. We managed our stock tightly in all categories and saw a strong performance from our Christmas ranges, including boxed cards, wrap, calendars and gifting. As a result, we ended the season in a clean stock position.

 

Our online personalised greetings card and gifting website, Funkypigeon.com, continues to grow its profit and performed well over the key Christmas and Valentine's Day seasons.  We grew share and extended our gifting ranges to include t-shirts and mobile phone covers.  Traffic from mobile devices continues to increase and during the half we launched new Apple and Android apps.

 

 

 

Books:

In Books, the market continues to vary by sub-category and to be impacted by the quality of publishing. We saw the strongest performance in Kids with our book space adjusted accordingly.  In Adult, apart from the Sir Alex Ferguson autobiography, Christmas hardback publishing was weaker than last year.  Our partnership with Kobo continues to develop, with the 250 Kobo 'shop in shops' performing well over Christmas.  We had a number of market leading deals with both the Kobo Mini and Kobo Touch selling at £29.99.  Over the half, eReader sales were well ahead of last year.

 

News and Impulse:

News and Impulse like-for-like sales were down 2% year on year with further improvement in gross margin. The newspaper and magazine market continues to be challenging but we continue to grow our market share further through successful promotions across several of the key titles. We continue to develop the strongly-growing bookazine category which helps improve our margins and our range now includes over 400 titles.  As we actively manage our space we have extended our food-to-go and convenience offer in Travel.  In High Street we rolled out new till front displays to over 400 stores.

 

Non-Operating Activities

 

Net Finance Cost

 

	6 months to
£m	Feb 2014		Feb 2013
Bank interest/unwinding of discount on provisions	(1)		(1)
Pension interest	(1)		(1)
Net finance costs	(2)		(2)

 

Net finance costs relating to bank loans and unwinding of discounts on provisions were £1m in line with last year.

 

IAS 19 (Revised), became effective for the Group for the current financial year ending 31 August 2014, and is a change in accounting policy which requires pension interest in the Income Statement to be calculated on the net balance sheet position for retirement benefit obligations at the beginning of the period.  The resulting non-cash pension charge was £1m in the period ended 28 February 2014.  The comparatives for the period ended 28 February 2013 have been restated to reflect a non-cash £1m charge following this change in accounting policy. 

 

Fixed Charges Cover

 

Fixed charges, comprising property operating lease rentals and net finance charges, were covered 1.8 times (2013: 1.7 times) by profit before tax and fixed charges.  In the full year we expect fixed charges cover to be consistent with the prior year at around 1.6 times.

 

Cash Flow and Balance Sheet

The Group generated £53m of free cash flow during the period.  

	6 months to
£m	Feb 2014		Feb 2013
Group operating profit	71		69
Depreciation, amortisation & amounts written off fixed assets	18		18
Working capital	(4)		-
Employers payroll tax on exercised share awards Net capital expenditure	(5) (19)		- (24)
Tax	(9)		(7)
Net provisions	(2)		(1)
Other items	3		3
Free cash flow	53		58

 

There was a small cash outflow from working capital of £4m with capital expenditure in the half of £19m, £5m lower than last year, which included the roll out of new tills.  Capital expenditure includes new stores in High Street and Travel, together with the ongoing investment in technology and the existing estate.  During the half we also paid the employers' payroll tax on the MIP and LTIP grants following the vesting of the 2010 MIP and LTIP awards.  We do not anticipate this repeating next year.  Net corporation tax paid was £9m in the period compared to £7m last year.

 

As at 28 February 2014 the Group had net funds of £18m. 

	6 months to
£m	Feb 2014		Feb 2013
Opening net funds	31		36
Free cash flow generated	53		58
Equity dividends paid	(26)		(23)
Pension deficit funding	(7)		(6)
Net purchase of shares for employee share schemes	(9)		-
Purchase of own shares for cancellation	(21)		(22)
Acquisitions and earnouts Other	(2) (1)		(2)                   -
	18		41

 

In addition to the free cash generated, the Group has seen a net outflow of £66m, relating to non-trading operations, which include last year's final dividend of £26m, pension deficit funding of £7m and net ESOP trust purchases of £9m.  As at 28 February 2014 the Group had returned £21m of cash to shareholders via an on market buyback.  Acquisitions and earnouts in the period relate to the acquisition of Wild Retail Group and payments relating to the acquisition of Fresh Plus. 

 

The Group had net assets of £146m before the IFRIC 14 pension liability and associated deferred tax asset, £6m lower than last year end, reflecting cash generation in the period offset by the share buyback programme.  Net assets after pensions were £99m compared to £102m at 31 August 2013. 

 

Principal risks and uncertainties

 

The principal risks and uncertainties which could impact the Group for the remainder of the current financial year remain those detailed on pages 15 and 16 of the Group's Annual Report and Accounts 2013, a copy which is available on the Group's website at www.whsmithplc.co.uk.  These include: economic, political, competitive and market risks; reliance on the WHSmith brand; key suppliers and supply chain management; store portfolio; business interruption; reliance on key personnel; treasury and financial risk; and pensions and investment risk.

 

 

This announcement contains certain forward looking statements with respect to the operations, performance and financial condition of the Group.  By their nature, these statements involve uncertainty since future events and circumstances can cause results to differ from those anticipated.  Nothing in this announcement should be construed as a profit forecast.  We undertake no obligation to update any forward looking statements whether as a result of new information, future events or otherwise.

 

WH Smith PLC          

Group Income Statement

For the 6 months to 28 February 2014

 

£m	Note	6 months to 28 Feb 2014   (unaudited)	6 months to 28 Feb 2013 Restated1 (unaudited)	12 months to 31 Aug 2013 Restated1 (audited)
Continuing operations
Revenue		613	638	1,186
Operating profit	2	71	69	107
Investment income		-	-	-
Finance costs	4	(2)	(2)	(4)
Profit before tax		69	67	103
Income tax expense	5	(13)	(15)	(22)
Profit for the year		56	52	81
Earnings per share
Basic	7	46.7p	41.9p	66.4p
Diluted	7	46.3p	40.3p	63.8p
Equity dividends per share2	6	10.8p	9.4p	30.7p
Non GAAP measures
	Note	6 months to 28 Feb 2014   (unaudited)	6 months to 28 Feb 2013 Restated1 (unaudited)	12 months to 31 Aug 2013 Restated1 (audited)
Reconciliation of Profit before tax to Headline Group profit before tax
Profit before tax		69	67	103
Adjusted for:
Non-cash income statement charge for pensions		1	1	3
Headline Group profit before tax	1	70	68	106
Headline earnings per share
Basic	7	47.5p	42.7p	68.9p
Diluted	7	47.1p	41.1p	66.1p
Fixed charges cover	8	1.8x	1.7x	1.6x

¹  Restated for adoption of IAS 19 Revised and IFRIC 14 minimum funding liability.  See Note 1. 

²  Current period dividend per share is the interim dividend.

 

 

 

WH Smith PLC          

Group Statement of Comprehensive Income

For the 6 months to 28 February 2014

 

£m	Note	6 months to 28 Feb 2014   (unaudited)	6 months to 28 Feb 2013 Restated1 (unaudited)	12 months to 31 Aug 2013 Restated1 (audited)
Profit for the period		56	52	81
Other comprehensive income:
Items that will not be reclassified subsequently to the income statement:
Actuarial losses on defined benefit pension schemes	3	(2)	-	-
Tax on defined benefit pension schemes		(1)	-	-
		(3)	-	-
Items that may be reclassified subsequently to the income statement:
Mark to market valuation of derivative financial asset		(2)	1	1
Exchange differences on translation of foreign operations		-	1	-
		(2)	2	1
Other comprehensive loss for the period, net of tax		(5)	2	1
Total comprehensive income for the period		51	54	82

¹  See Note 1. 

 

 

WH Smith PLC          

Group Balance Sheet

As at 28 February 2014

 

					At		At		At
	£m		Note		28 Feb 2014   (unaudited)		28 Feb 2013 Restated1 (unaudited)		31 Aug 2013 Restated1 (audited)
	Non-current assets
	Goodwill				34		33		33
	Other intangible assets				22		25		22
	Property, plant and equipment				151		152		149
	Deferred tax assets				19		23		23
	Trade and other receivables				2		3		3
					228		236		230
	Current assets
	Inventories				149		152		148
	Trade and other receivables				49		49		51
	Current tax asset				-		-		2
	Derivative financial asset				-		1		1
	Cash and cash equivalents		9		57		41		31
					255		243		233
	Total assets				483		479		463
	Current liabilities
	Trade and other payables				(222)		(234)		(232)
	Bank overdrafts and other borrowings		9		(39)		-		-
	Retirement benefit obligation		3		(11)		(11)		(11)
	Current tax liabilities				(41)		(46)		(42)
	Short-term provisions				(4)		(4)		(3)
	Derivative financial liability		13		(1)		-		-
					(318)		(295)		(288)
	Non-current liabilities
	Retirement benefit obligation		3		(47)		(55)		(51)
	Deferred tax liabilities				(1)		(3)		(2)
	Long-term provisions				(3)		(3)		(4)
	Other non-current liabilities				(15)		(15)		(16)
					(66)		(76)		(73)
	Total liabilities				(384)		(371)		(361)
	Total net assets				99		108		102
Shareholders' equity
Called up share capital				27		28		27
Share premium				4		3		4
Capital redemption reserve				10		9		10
Revaluation reserve				2		2		2
ESOP reserve				(11)		(21)		(21)
Hedging reserve				(1)		1		1
Translation reserve				(3)		(2)		(3)
Other reserve				(234)		(213)		(215)
Retained earnings				305		301		297
Total equity				99		108		102

¹  See Note 1. 

 

WH Smith PLC          

Group Cash Flow Statement

For the 6 months to 28 February 2014

 

		6 months to		12 months to
£m	Note	28 Feb 2014 (unaudited)	28 Feb 2013 (unaudited)	31 Aug 2013 (audited)
Net cash inflow from operating activities	10	65	75	119
Investing activities
Purchase of property, plant and equipment		(17)	(19)	(32)
Purchase of intangible assets		(2)	(5)	(6)
Acquisition of business		(2)	(1)	(1)
Net cash outflow from investing activities		(21)	(25)	(39)
Financing activities
Dividend paid		(26)	(23)	(34)
Purchase of own shares for cancellation		(21)	(22)	(50)
Purchase of own shares for employee share schemes		(9)	-	(1)
Proceeds from borrowings		39	-	-
Net cash used in financing activities		(17)	(45)	(85)
Net increase / (decrease) in cash and cash equivalents in the period		27	5	(5)
Cash and cash equivalents at beginning of the period		31	36	36
Effect of movements in foreign exchange rates		(1)	-	-
Cash and cash equivalents at end of the period		57	41	31

 

Reconciliation of net cash flow to movement in net funds

 

 

			6 months to		12 months to
£m		Note	28 Feb 2014 (unaudited)	28 Feb 2013 (unaudited)	31 Aug 2013 (audited)
Net funds at beginning of the period			31	36	36
Increase / (decrease) in cash and cash equivalents			26	5	(5)
(Increase) / decrease in debt			(39)	-	-
Net funds at end of the period		9	18	41	31

 

WH Smith PLC          

Group Statement of Changes in Equity

For the 6 months to 28 February 2014

 

£m	Share capital and share premium	Capital redemption reserve	Revaluation reserve	ESOP reserve	Hedging and translation reserves	Other reserve1	Retained earnings	Total
Balance at 1 September 2013	31	10	2	(21)	(2)	(215)	297	102
Total comprehensive income for the period	-	-	-	-	(2)	-	53	51
Recognition of share-based payments	-	-	-	-	-	-	3	3
Deferred tax on share-based payments	-	-	-	-	-	-	(1)	(1)
Premium on issue of shares	-	-	-	-	-	-	-	-
Dividends paid	-	-	-	-	-	-	(26)	(26)
Employee share schemes	-	-	-	10	-	(19)	-	(9)
Purchase of own shares for cancellation	-	-	-	-	-	-	(21)	(21)
Balance at 28 February 2014 (unaudited)	31	10	2	(11)	(4)	(234)	305	99

 

Balance at 1 September 2012	32	8	2	(22)	(3)	(212)	290	95
Total comprehensive income for the period2	-	-	-	-	2	-	52	54
Recognition of share-based payments	-	-	-	-	-	-	3	3
Deferred tax on share-based payments	-	-	-	-	-	-	1	1
Premium on issue of shares	-	-	-	-	-	-	-	-
Dividends paid	-	-	-	-	-	-	(23)	(23)
Employee share schemes	-	-	-	1	-	(1)	-	-
Purchase of own shares for cancellation	(1)	1	-	-	-	-	(22)	(22)
Balance at 28 February 20132 (unaudited)	31	9	2	(21)	(1)	(213)	301	108

 

Balance at 1 September 2012	32	8	2	(22)	(3)	(212)	290	95
Total comprehensive income for the period	-	-	-	-	1	-	81	82
Recognition of share-based payments	-	-	-	-	-	-	7	7
Deferred tax on share-based payments	-	-	-	-	-	-	3	3
Premium on issue of shares	1	-	-	-	-	-	-	1
Dividends paid	-	-	-	-	-	-	(34)	(34)
Employee share schemes	-	-	-	1	-	(3)	-	(2)
Purchase of own shares for cancellation	(2)	2	-	-	-	-	(50)	(50)
Balance at 31 August 2013 (audited)	31	10	2	(21)	(2)	(215)	297	102

¹ The 'Other' reserve includes reserves created in relation to the historical capital reorganisation, proforma restatement and the demerger from Smith News PLC in 2006, as well as movements relating to employee share schemes of £19m (2013: £1m).

² Restated for recognition of IFRIC 14 minimum funding liability.  See Note 1.

 

WH Smith PLC          

Notes to the Interim Financial Statements

For the 6 months to 28 February 2014

1.	Basis of preparation, Accounting policies and Approval of Interim Statement

 

The Interim Financial Statements for the 6 months ended 28 February 2014 have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Services Authority and with IAS 34, "Interim Financial Reporting" as adopted by the European Union. This report should be read in conjunction with the Group's Annual Report and Accounts 2013, which have been prepared in accordance with IFRSs as adopted by the European Union.

The financial information set out in this report does not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006. The Annual Report and Accounts 2013 have been filed with the Registrar of Companies.  The auditors' report on those accounts was unqualified, did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying the report and did not contain statements under s498(2) or s498(3) of the Companies Act 2006.

The Interim Financial Statements have been prepared in accordance with the accounting policies set out in the 2013 Annual Report and Accounts and it is these accounting policies which are expected to be followed in the preparation of the full financial statements for the financial year ended 31 August 2014, except as outlined below.  

In June 2011 the IASB issued amendments to IAS 19 "Employee Benefits" (IAS 19 (Revised)).  The revised standard is effective for the Group for the first time during the 6 months ended 28 February 2014.  The impact on the Group's defined benefit pension schemes is to replace the interest expense on retirement benefit obligations and the expected return on plan assets with a single net interest amount that is calculated by applying the discount rate to the net retirement benefit surplus or deficit.  In addition, the administration costs of the pension scheme, previously charged against the expected return on plan assets, are now charged within operating costs.  The impact of the amendment has been to reduce profit before tax by £2m for the six months ended 28 February 2014 (six months ended 28 February 2013: a reduction of £2m, year ended 31 August 2013: a reduction of £5m).  Prior year comparatives have been restated, and the impact of these restatements is set out in note 16.

The Group has also adopted the following standards and interpretations which became mandatory for the first time during the current financial year.  The adoption of these standards has had no material impact on the Group.  All other amendments which apply for the first time in the current financial year do not impact the interim consolidated financial information of the Group.

Amendments to IFRS 7 Financial instruments: Disclosures - Offsetting financial assets and financial liabilities

IFRS 13                        Fair value measurement

IFRS 13 establishes a single source of guidance under IFRS for all fair value measurements.  The application of IFRS 13 has not materially impacted the fair value measurements carried out by the Group.  However IFRS 13 requires specific disclosures on fair values.  The Group has included the required disclosures at note 13.

For the year ended 31 August 2013, the Group amended its accounting in respect of the schedule of contributions to the WH Smith Pension Trust to recognise these as an obligation of the Company under IFRIC 14.  The prior year comparatives for the six months ended 28 February 2013 have been restated to reflect this change.  The accounting for the minimum funding requirement is therefore on a consistent basis for all periods disclosed.  The impact of the restatement is set out in note 16.

The Group has identified certain measures that it believes will assist the understanding of the performance of the business.  The Group believes that High Street and Travel trading profit, Group profit from trading operations, Headline Group profit before tax, Headline earnings per share, Fixed charges cover and Free cash flow provide useful information to users of the financial statements.  The terms are not defined terms under IFRS and may therefore not be comparable with similarly titled measures reported by other companies.  They are not intended to be a substitute for, or superior to, GAAP measures. 

The Group's business activities together with the factors that are likely to affect its future developments, performance and position are set out in the Financial Review.  The Financial Review describes the Group's financial position, cash flows and borrowing facilities and also highlights the principal risks and uncertainties facing the Group. The Annual Report and Accounts 2013 includes the Group's objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments and hedging activities; and its exposures to credit risk and liquidity risk.

The directors report that they have reviewed current performance and forecasts, combined with expenditure commitments, including capital expenditure, proposed dividends and borrowing facilities.  After making enquiries, the directors have a reasonable expectation that the Group has adequate financial resources to continue its current operations, including contractual and commercial commitments for the foreseeable future.  For these reasons, the going concern basis has been adopted in preparing the financial statements. 

The Interim Financial Statements are unaudited but have been reviewed by our auditors and were approved by the Board of Directors on 10 April 2014.

WH Smith PLC          

Notes to the Interim Financial Statements

For the 6 months to 28 February 2014

 

2.	Segmental analysis of results

 

 

For management and financial reporting purposes, the Group is organised into two operating divisions - High Street and Travel. These divisions are the basis on which the Group reports its IFRS 8 operating segment information.

 

a)	Group revenue

 

 

	6 months to		12 months to
£m	28 Feb 2014 (unaudited)	28 Feb 2013 (unaudited)	31 Aug 2013 (audited)
Continuing operations:
Travel	221	216	460
High Street	392	422	726
Group revenue	613	638	1,186

 

Seasonality

Sales in the High Street business are subject to seasonal fluctuations, with peak demand in the Christmas trading period, which falls in the first half of the Group's financial year.  For the six months ended 28 February 2014, the level of High Street sales represented 54% (2013: 54%) of the annual level of High Street sales in the year ended 31 August 2013. 

 

 

b)	Group results

 

 

	6 months to		12 months to
£m	28 Feb 2014   (unaudited)	28 Feb 2013 Restated1 (unaudited)	31 Aug 2013 Restated1 (audited)
Continuing operations
Travel	30	29	66
High Street	49	48	56
Profit from trading operations	79	77	122
Unallocated costs	(8)	(8)	(15)
Group operating profit	71	69	107
Investment income	-	-	-
Finance costs	(2)	(2)	(4)
Income tax expense	(13)	(15)	(22)
Profit for the period	56	52	81

¹  See Note 1. 

 

 

Group profit before finance charges and taxation for the period to 28 February 2014 is stated after the write-down of inventories to net realisable value, £1m (2013: £2m).  

 

 

WH Smith PLC          

Notes to the Interim Financial Statements

For the 6 months to 28 February 2014

3.	Retirement benefit obligation

 

WH Smith PLC has operated a number of defined benefit plans, which are closed to service accrual, and defined contribution pension plans.  The main pension arrangements for employees are operated through a defined benefit scheme, WHSmith Pension Trust, and a defined contribution scheme, WH Smith Retirement Savings Plan. The most significant scheme is the defined benefit WHSmith Pension Trust.

 

The retirement benefit obligations recognised in the balance sheet for the respective schemes at the relevant reporting dates were:

 

£m	At 28 Feb 2014   (unaudited)	At 28 Feb 2013 Restated1 (unaudited)	At 31 Aug 2013    (audited)
WHSmith Pension Trust	(58)	(66)	(62)
United News Shops Retirement Benefits Scheme	-	-	-
Retirement benefit obligation recognised in the balance sheet	(58)	(66)	(62)

¹  See Note 1. 

 

WHSmith Pension Trust

 

The market value of the assets and the present value of the liabilities in the scheme at the relevant reporting dates were:

 

£m	At 28 Feb 2014   (unaudited)	At 28 Feb 2013 Restated1 (unaudited)	At 31 Aug 2013    (audited)
Present value of the obligations	(878)	(832)	(856)
Fair value of plan assets	997	962	964
Surplus before consideration of asset ceiling	119	130	108
Amounts not recognised due to effect of asset ceiling	(119)	(130)	(108)
Additional liability recognised due to minimum funding requirements	(58)	(66)	(62)
Retirement benefit obligation recognised in the balance sheet	(58)	(66)	(62)

 

Movement in net retirement benefit liability during the period:

	6 months to		12 months to
£m	28 Feb 2014   (unaudited)	28 Feb 2013 Restated1 (unaudited)	31 Aug 2013 Restated1 (audited)
At beginning of period	(62)	(70)	(70)
Current service cost	-	-	-
Net interest cost on the defined benefit liability	(1)	(1)	(3)
Contributions	7	6	12
Actuarial gains and losses	(2)	(1)	(1)
At end of period	(58)	(66)	(62)

 

WH Smith PLC          

Notes to the Interim Financial Statements

For the 6 months to 28 February 2014

3.	Retirement benefit obligation (continued)

 

The defined benefit pension schemes are closed to further accrual and given the Liability Driven Investment policy adopted by the WHSmith Pension Trust Trustees, the present value of the economic benefits of the IAS 19 surplus in the pension scheme of £119m (2013: £130m) available on a reduction of future contributions is £nil (2013: £nil). As a result the Group has not recognised this IAS 19 surplus on the balance sheet.  There is an ongoing actuarial deficit primarily due to the different assumptions and calculation methodologies used compared to those under IAS 19.  We have recognised the schedule of contributions as a liability of £58m in accordance with the requirements of IFRIC 14.  We have also restated the February 2013 Financial Statements recognising a liability of £66m.  See Note 1.

 

A full actuarial valuation of the scheme is carried out every three years, with interim reviews in the intervening years.  The latest full actuarial valuation of the Pension Trust was carried out at 31 March 2012 by independent actuaries using the projected unit credit method.  Following this valuation, the deficit was £75m, and a revised deficit funding schedule of approximately £13m per annum (subject to indexation) over the following seven years was agreed with the Trustee.  During the period, the Group made a contribution of £7m to the WHSmith Pension Trust (2013: £6m) in accordance with the agreed pension deficit funding schedule.

 

Total (expense) / income recognised in the Statement of Comprehensive Income ("SOCI"):

	6 months to		12 months to
£m	28 Feb 2014   (unaudited)	28 Feb 2013 Restated1 (unaudited)	31 Aug 2013 Restated1 (audited)
Total actuarial gain / (loss) before consideration of asset ceiling	1	8	(22)
(Loss) / gain resulting from changes in amounts not recognised due to effect of asset ceiling	(8)	(15)	10
Changes in minimum funding liability	5	6	11
Actuarial gains in respect of United News Shops Retirement benefits scheme	-	1	1
Total actuarial loss recognised in other comprehensive income	(2)	-	-

 

The principal long-term assumptions used in the IAS 19 valuation were:

 

	6 months to		12 months to
%	28 Feb 2014 (unaudited)	28 Feb 2013 (unaudited)	31 Aug 2013 (audited)
Rate of increase in pension payments	3.28	3.39	3.36
Rate of increase in deferred pensions	2.50	2.49	2.59
Discount rate	4.32	4.52	4.50
RPI Inflation assumption	3.40	3.39	3.49
CPI Inflation assumption	2.50	2.49	2.59

 

 

 

4.	Finance costs

 

	6 months to		12 months to
£m	28 Feb 2014   (unaudited)	28 Feb 2013 Restated1  (unaudited)	31 Aug 2013 Restated1  (audited)
Interest payable on bank loans and overdrafts & unwinding of discounts on provisions	1	1	1
Net interest cost on the defined benefit pension liability	1	1	3
	2	2	4

¹  See Note 1. 

 

 

WH Smith PLC          

Notes to the Interim Financial Statements

For the 6 months to 28 February 2014

5.	Income tax expense

 

	6 months to		12 months to
£m	28 Feb 2014   (unaudited)	28 Feb 2013 Restated1 (unaudited)	31 Aug 2013 Restated1 (audited)
Tax on profit from continuing operations	18	23	37
Standard rate of UK corporation tax 22.16% (2012: 23.58%)
Adjustment in respect of prior year UK corporation tax	(5)	(8)	(15)
Total current tax charge - continuing operations	13	15	22
Deferred tax - current year	-	-	-
Deferred tax - prior year	-	-	-
Tax on profit - continuing operations	13	15	22
Effective tax rate on continuing activities	19%	22%	21%

 

Tax on Headline profit - continuing operations	13	15	22
Effective tax rate on Headline profit - continuing activities	19%	22%	21%

¹  See Note 1. 

 

 

6.

Dividends

 

 Amounts paid and recognised as distributions to shareholders in the period are as follows:

 

	6 months to		12 months to
£m	28 Feb 2014 (unaudited)	28 Feb 2013 (unaudited)	31 Aug 2013 (audited)
Dividends
Interim	-	-	11
Final	26	23	23
	26	23	34

 

The directors have declared an interim dividend in respect of the period ending 28 February 2014 of 10.8p per ordinary share, which will absorb an estimated £13m of shareholders' equity.  This will be paid on 7 August 2014 to shareholders registered at the close of business on 18 July 2014.

 

 

7.	Earnings per share

 

a)

Earnings

 

	6 months to		12 months to
£m	28 Feb 2014   (unaudited)	28 Feb 2013 Restated1 (unaudited)	31 Aug 2013 Restated1 (audited)
Earnings attributable to shareholders	56	52	81
Adjusted for non-headline items (net of taxation):
Non-cash income statement charge for pensions	1	1	3
Headline earnings attributable to shareholders	57	53	84

¹  See Note 1. 

 

 

WH Smith PLC          

Notes to the Interim Financial Statements

For the 6 months to 28 February 2014

7.	Earnings per share (continued)

 

b)	Basic and diluted earnings per share

 

		6 months to		12 months to
Pence		28 Feb 2014   (unaudited)	28 Feb 2013 Restated1 (unaudited)	31 Aug 2013 Restated1 (audited)
Basic earnings per share		46.7	41.9	66.4
Adjustments for non-headline items		0.8	0.8	2.5
Basic headline earnings per share		47.5	42.7	68.9
Diluted earnings per share		46.3	40.3	63.8
Adjustments for non-headline items		0.8	0.8	2.3
Diluted headline earnings per share		47.1	41.1	66.1

¹  See Note 1. 

 

Diluted earnings per share takes into account various share awards and share options including SAYE schemes, which are expected to vest, and for which a sum below fair value will be paid.

 

c)	Weighted average share capital

 

	6 months to		12 months to
Millions	28 Feb 2014 (unaudited)	28 Feb 2013 (unaudited)	31 Aug 2013 (audited)
Weighted average ordinary shares in issue	123	129	127
Less weighted average ordinary shares held in ESOP Trust	(3)	(5)	(5)
Weighted average ordinary shares for earnings per share	120	124	122
Add weighted average number of ordinary shares under option	1	5	5
Weighted average ordinary shares for diluted earnings per share	121	129	127

 

 

8.	Fixed Charges Cover - Non GAAP

 

	6 months to		12 months to
£m	28 Feb 2014   (unaudited)	28 Feb 2013 Restated1 (unaudited)	31 Aug 2013 Restated1 (audited)
Net finance charges	2	2	4
Net operating lease rentals	89	89	182
Total fixed charges	91	91	186
Profit before tax	69	67	103
Profit before tax and fixed charges	160	158	289
Fixed charges cover - times	1.8x	1.7x	1.6x

¹  See Note 1. 

 

 

 

WH Smith PLC          

Notes to the Interim Financial Statements

For the 6 months to 28 February 2014

9.	Analysis of net funds

 

Movements in net funds can be analysed as follows:

 

£m	At 28 Feb 2014 (unaudited)	At 28 Feb 2013 (unaudited)	At 31 Aug 2013 (audited)
Cash and cash equivalents	57	41	31
Borrowings	(39)	-	-
Net funds	18	41	31

 

 

£m	At 31 Aug 2013 (audited)	Cash flow	Currency translation	At 28 Feb 2014 (unaudited)
Cash and cash equivalents	31	27	(1)	57
Borrowings	-	(39)	-	(39)
Net funds	31	(12)	(1)	18

 

Cash and cash equivalents comprise cash held by the Group and short-term bank deposits with an original maturity of three months or less.  The carrying amount of these assets approximates their fair value.

 

The Group has a £70m 5-year committed revolving credit facility.  As at 28 February 2014 this Group had drawn down £39m on this facility.  The revolving credit facility is due to mature on 24 January 2016.  During the period the interest rate on the facility was LIBOR plus 110bps.

 

10.	Net cash inflow from operating activities

 

	6 months to		12 months to
£m	28 Feb 2014 (unaudited)	28 Feb 2013 (unaudited)	31 Aug 2013 (audited)
Operating profit from continuing operations	71	69	107
Depreciation and amortisation	17	17	35
Impairment losses	1	1	2
Share-based payments	3	3	7
(Increase) / decrease in inventories	(1)	(1)	3
Decrease in receivables	3	6	4
Decrease in payables	(11)	(5)	(6)
Adjustment for pension funding	(7)	(6)	(12)
Income taxes paid	(9)	(7)	(19)
Charge to provisions	-	-	1
Cash spend against provisions	(2)	(2)	(3)
Net cash inflow from operating activities	65	75	119

 

 

WH Smith PLC          

Notes to the Interim Financial Statements

For the 6 months to 28 February 2014

11.	Called Up Share Capital

 

	28 Feb 2014 (unaudited)		28 Feb 2013 (unaudited)		31 Aug 2013 (audited)
	Number of shares (millions)	Nominal value £m	Number of shares (millions)	Nominal value £m	Number of shares (millions)	Nominal value £m
Equity
Ordinary shares of 22 6/67p	121	27	127	28	123	27
Total	121	27	127	28	123	27

 

During the six month period the Company repurchased 2,107,000 (six months to 28 February 2013: 3,280,000) of its own shares in the open market for an aggregate consideration of £21m (2013: £22m).

 

The holders of ordinary shares are entitled to receive dividends as declared from time-to-time and are entitled to one vote per share at the meetings of the Company.

 

 

12.	Contingent liabilities

 

	6 months to		12 months to
£m	28 Feb 2014 (unaudited)	28 Feb 2013 (unaudited)	31 Aug 2013 (audited)
Bank and other loans guaranteed	4	4	5

 

Other potential liabilities that could crystallise are in respect of previous assignments of leases where the liability could revert to the Group if the lessee defaulted.  Pursuant to the terms of the Demerger Agreement with Smiths News PLC, any such contingent liability, which becomes an actual liability, will be apportioned between the Group and Smiths News PLC in the ratio 65:35 (provided that the actual liability of Smiths News PLC in any 12 month period does not exceed £5m).  The Group's 65 per cent share of these leases has an estimated future rental commitment at 28 February 2014 of £10m (28 February 2013: £15m).

 

 

13.	Financial Instruments

IFRS 13 requires disclosure of fair value measurements by level based on the following measurement hierarchy:

 

·      Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

·      Level 2 - inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices); and

·      Level 3 - inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs).

 

All fair value measurements made by the group are in the Level 2 category. The fair value of forward foreign exchange contracts has been determined using forward currency exchange rates at the balance sheet date. These have been provided by the individual banking institutions with whom the contracts are held. There have been no transfers of assets or liabilities between any levels of the fair value hierarchy.

 

£m	28 Feb 2014 (unaudited)
Financial liabilities
Derivative financial instruments:
Forward foreign currency contracts	1
	1

 

WH Smith PLC          

Notes to the Interim Financial Statements

For the 6 months to 28 February 2014

14.	Acquisitions

On 31 January 2014, the Group acquired 100 per cent of the issued share capital of Wild Retail Group Pty Limited, a company incorporated in Australia, for a cash consideration of £2m.  The acquired company is a franchisor of cards and gifts. The fair value of assets acquired is £2m and has been allocated as follows; £1m intangible assets (representing the brand and franchise contracts), £1m goodwill.

 

15.	Related Parties

There have been no material changes to the related party transactions during the interim period under review.

 

16.	Restatement of prior period information

The Group has adopted IAS 19 (Revised) during the period.   The impact on the Group's defined benefit pension schemes is to replace the interest expense on retirement benefit obligations and the expected return on plan assets with a single net interest amount that is calculated by applying the discount rate to the net retirement benefit surplus or deficit.  In addition, the administration costs of the pension scheme, previously charged against the expected return on plan assets, are now charged within operating costs.  Prior year comparatives have been restated as set out below.

 

In addition, for the year ended 31 August 2013, the Group amended its accounting in respect of the schedule of contributions to the WH Smith Pension Trust to recognise these as an obligation of the Company under IFRIC 14.  The prior year comparatives for the six months ended 28 February 2013 have been restated to reflect this change.

 

	6 months to 28 February 2013
£m	Previously reported	Impact of liability recognition	Impact of IAS 19R	Restated
Income statement
Headline profit before tax	68	-	-	68
Non-cash income statement income/ (charge) for pensions	1	-	(2)	(1)
Profit before tax	69	-	(2)	67
Income tax expense	(12)	(3)	-	(15)
Profit after tax	57	(3)	(2)	52
Earnings per share
Basic	46.0p	(2.5)p	(1.6)p	41.9p
Diluted	44.2p	(2.3)p	(1.6)p	40.3p
Headline earnings per share
Basic	45.2p	(2.5)p	-	42.7p
Diluted	43.4p	(2.3)p	-	41.1p
Statement of comprehensive income
Profit after tax	57	(3)	(2)	52
Actuarial gains / (losses)	(6)	4	2	-
Tax on items taken directly to equity	-	-	-	-
Other items of comprehensive income	2	-	-	2
Total comprehensive income	53	1	-	54
Balance sheet
Retirement benefit obligation	-	(66)	-	(66)
Deferred tax asset on retirement benefit obligation	-	14	-	14
	-	(52)	-	(52)

WH Smith PLC          

Notes to the Interim Financial Statements

For the 6 months to 28 February 2014

 

16.	Restatement of prior period information (continued)

 

	12 months to 31 August 2013
£m	Previously reported	Impact of IAS 19R	Restated
Income statement
Headline profit before tax	106	-	106
Non-cash income statement income / (charge) for pensions	2	(5)	(3)
Profit before tax	108	(5)	103
Income tax expense	(21)	(1)	(22)
Profit after tax	87	(6)	81
Earnings per share
Basic	71.3p	(4.9)p	66.4p
Diluted	68.5p	(4.7)p	63.8p
Headline earnings per share
Basic	69.7p	(0.8)p	68.9p
Diluted	66.9p	(0.8)p	66.1p
Statement of comprehensive income
Profit after tax	87	(6)	81
Actuarial gains / (losses)	(5)	5	-
Tax on items taken directly to equity	(1)	1	-
Other items of comprehensive income	1	-	1
Total comprehensive income	82	-	82
Balance sheet
Retirement benefit obligation	(62)	-	(62)
Deferred tax asset on retirement benefit obligation	12	-	12
	(50)	-	(50)

 

 

Statement of Directors' Responsibilities

 

The Directors confirm to the best of their knowledge that this condensed set of financial statements has been prepared in accordance with IAS 34 "Interim Financial Reporting" as adopted by the European Union, and that the interim management report herein includes a fair review of the information required by DTR 4.2.7R and DTR 4.2.8R.

 

The Directors of WH Smith PLC are listed on the website at www.whsmithplc.co.uk/about_whsmith/directors/. 

 

By order of the Board

 

 

 

 

 

Stephen Clarke                                                Robert Moorhead

Group Chief Executive                                     Chief Financial Officer and Chief Operating Officer

 

10 April 2014

INDEPENDENT REVIEW REPORT TO WH SMITH PLC

 

We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 28 February 2014 which comprises the group income statement, the group statement of comprehensive income, the consolidated balance sheet, the consolidated cash flow statement, the consolidated statement of changes in equity and related notes 1 to 16. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

 

This report is made solely to the company in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board.  Our work has been undertaken so that we might state to the company those matters we are required to state to them in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our review work, for this report, or for the conclusions we have formed.

 

Directors' responsibilities

 

The half-yearly financial report is the responsibility of, and has been approved by, the directors.  The directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

 

As disclosed in note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union.  The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting," as adopted by the European Union.

 

Our responsibility

 

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

 

Scope of Review

 

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

 

Conclusion

 

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 28 February 2014 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

 

 

 

Deloitte LLP

Chartered Accountants and Statutory Auditor

London, United Kingdom

10 April 2014

 

WH Smith PLC

 

Appendix

 

Analysis of retailing stores and selling space

 

Number of High Street stores

	1 Sept 2013	Opened	Closed	28 Feb 2014
High Street	615	-	(8)	607
Total	615	-	(8)	607

 

A Travel store may consist of multiple units within one location. On an individual unit basis, Travel stores can be analysed as follows:

 

Number of Travel units

	1 Sept 2013	Opened	Closed	28 Feb 2014
Non franchise units	494	17	(5)	506
Joint Venture and Franchise units1	179	16	-	195
Total	673	33	(5)	701

 

¹ Note - excludes kiosks in China.

 

Retail selling square feet ('000s)

	1 Sept 2013	Opened	Closed	28 Feb 2014
High Street	3,000	-	(38)	2,962
Travel	522	9	(2)	529
Total	3,522	9	(40)	3,491

 

Total Retail selling square feet does not include franchise units.