Shares in WH Smith remained relatively unchanged today despite the travel retailer reporting a “solid” Q4 revenue performance.

In its UK division, the firm saw its total revenue increase by 7% year-on-year in Q4, supported by passenger growth and higher passenger spend in its air division, while its hospital division saw revenue increase by 9%.

Rail also saw a revenue increase of 5% year-on-year.

Its North America division also saw revenue jump by 5%, while its rest of world and other revenue dropped by 4%, as store closures continued in the period.

In its outlook, WH Smith said its headline profit before tax is expected to be around £75m, reflecting lower trading profit margins, driven by increased promotional activity, a reduction in brand marketing and inflation headwinds.

This is offset by central cost reductions and lower interest costs.

The group added that it has made good progress on its transformation agenda, which was underpinned by strong cost and cash management underpinned by working capital improvements, portfolio rationalisation and targeted investment in higher-return travel essentials space.

Head of markets at AJ Bell, Dan Coatsworth, said WH Smith is "having a hard time convincing the market" that its problems can be solved quickly.

He concluded: "A trading update has failed to breathe new life into its share price as the business seems to be drifting sideways rather than taking big strides ahead.

"North America has been the worry point and fourth quarter revenue growth has slowed versus the previous three months. On a like-for-like basis, Q4 sales have fallen for the region, which is not what WH Smith needs to win over investors. The rebound in the oil price since mid-summer is unhelpful as it pushes up the cost of getting from A to B, which threatens to dampen activity at WH Smith’s all-important travel hubs.

"WH Smith talks about ‘good progress’ on its transformation strategy, but the latest trading figures suggest that its journey to get back on top could be a lengthy one."

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