WHSmith, a British newspaper, books and stationery retailer, is embarking on a major expansion in the Middle East as it seeks to diversify away from a stagnant home market.
The retailer, founded in 1792 in London, announced yesterday it would open two additional stores in Dubai, two in Qatar and two in Saudi Arabia.
The company's revenue grew 3 per cent to £74 million (Dh435.4m) in the six months to February 29, but experienced flat profits from stores on high streets in the United Kingdom.
"Looking ahead, we expect the trading environment to be challenging. However, we are a resilient business with a consistent record of both profit growth and cash generation, and we have opportunities for growth in the UK and internationally," said Kate Swann,the chief executive, announcing the results.
WHSmith last year appointed Aventus Retail as its local franchisee in the UAE, opening a Dubai store first in the Oasis Centre, owned and operated by the Landmark Group.
It has since opened a store in Dubai's Business Bay district and has plans to open two more in Dubai Mall and the emirate's Marina Mall.
Like many retailers in the UK, WHSmith, which is listed on the London Stock Exchange, has experienced difficult trading as consumer confidence has fallen amid toughening government austerity measures.
The brand is on a global expansion plan and now has a total of 80 stores either open or in the works in airports, train stations, malls and hospitals. It plans to open 20 additional stores in India, Australia, Fiji, Gibraltar and the Middle East.
"The group remains cash-generative, enabling us to invest in our businesses and new opportunities, whilst also returning cash to shareholders," said Ms Swann.
Of the 80 international stores already agreed, 71 per cent are franchises, 23 per cent are direct leases, and the remainder are joint ventures.
The group's travel division, made up of outlets at airports, train stations and motorway service stations in the UK and internationally, increased operating profit 8 per cent to £27m in the first half of its financial year. Its profit from retail stores in the UK were flat at £47m.