An update to the stock market today made no mention of the furore, which has seen passengers at airports refusing to show the passes. Management also refused to answer questions from the Evening Standard over the issue.
However, analysts suggested worse could be to come in the longer term, suggesting several million could be wiped off WH Smith’s bottom line.
The company only said its travel business put in a “strong performance” in the past three months, taking advantage of growing passenger numbers passing through airports and train stations.
The newsagent chain did reveal that its high street performance managed to record a sales rise for the first time in several years, after a decade of putting profits over sales, helping profits to beat analysts’ expectations.
Big-title books, including EL James’s Grey and Harper Lee’s Go Set a Watchman helped boost sales on the high street, along with the continuing popularity for adult colouring-in books.
On the VAT scandal, analysts appeared unsurprised by the company’s reaction. Tony Shiret, retail analyst at BESI, said: “So far it appears to have seen minimal impact. That is not to say that this will not become more of an issue but we feel that it is likely to be a very low single-digit millions type of issue at worst.”
Nick Bubb, an independent retail analyst, added: “All that matters to WHS is profit, cash and dividends (and their growth record in that regard is exemplary), so nobody in the City is surprised that they take a hard line on minimising tax liabilities of all kinds
