WH Smith PLC (LON:SMWH) said it continues to focus on expanding travel locations but it will be a while before it recovers from the huge full-year loss caused by the pandemic.
The FTSE 250 firm continues to invest in new stores and new store formats in the UK and North America to grab market share once the pandemic is over.
The newsagent expects a cash burn of £20mln in November from £5-10mln per month in September and October.
As of the end of October, it had access to £323mln of liquidity.
The retail expects a gradual improvement in air domestic passenger numbers first, particularly in the US where 85% of passengers are domestic, followed by international and inter-continental passengers.
In rail, as government restrictions are lifted, and more people return to work, sales are also estimated to gradually improve.
In the year to August 31, WH Smith slumped to a £280mln loss before tax from £135mln profit a year ago.
Group revenue tumbled 33% to £1bn, with travel down 43% and the high street down 19%, and the dividend was scrapped to save cash.
“WH Smith’s high street business was already facing an uphill struggle with the company heavily reliant on growth through its convenience shops dotted across the transport network,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.
“But this captive market where shoppers made impulse purchases as they waited for trains and planes, or scanned a grab and go sandwich on their daily commute, all but evaporated during the pandemic.”
“With the working from home revolution unlikely to fully unravel and global tourism not forecast to return to last year’s levels until 2023, it may be a very long path back to profit.”
Shares added 2% to 1,472.36p on Thursday morning.