WH Smith PLC (LON:SMWH) said it has delivered a better-than-expected performance and trimmed monthly cash burn forecasts.
The newsagent’s chain said revenue in its High Street business dropped 26% and 16% in January and February respectively, which was ahead of expectations.
READ: WH Smith sale of Funky Pigeon could boost pivot to travel business, says broker
The online greeting cards business, funkypigeon.com, saw record sales for the Valentine's day period.
The travel segment continued to suffer from COVID-19 restrictions, with revenue dropping 65% and 67% in January and February respectively.
Thanks to the better-than-anticipated trading performance since the start of January, the monthly cash burn in the three months to March 31 is expected to be £12-17mln compared with the previously guided £15-20mln.
As of February 28, the group had cash on deposit of £52mln with £50mln of known commitments, such as rents, and access to £200mln of committed facilities.
The retailer also announced the extension of its bank financing arrangements with its existing banks.
It extended the maturity of its two existing £200mln Term Loans to October 2023 and agreed a new minimum liquidity covenant for both the August 2021 and February 2022 covenant tests, while the previously agreed covenant waiver for February 2021 remains unchanged.
These changes allowed WH Smith to cancel its existing £120mln liquidity loan which was undrawn and due to expire in November 2021.
A £200mln Revolving Credit facility remains unchanged with the current arrangement due for renewal in December 2023.
"The speed of recovery out of lockdown for travel is key, but there is plenty to like for the long term and we remain keen buyers," analysts at Peel Hunt noted.
Shares rose 1% to 1,918.4p on Tuesday morning.
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