Smiths News sets £30m savings target

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Smiths News, the newspaper and book distributor, has raised its target for efficiency savings from £20m to £30m after saving more than expected in the first half.

In October last year, it set out plans to save £20m over the next three years, but says that in the first half of its financial year it has saved £11m and expects to save another £9m by the end of the year.

As a result it has increased its three year target to £30m, saying that these efficiency improvements will fully compensate for tougher trading conditions.

Since October it has closed its North London depot, merged the Northampton magazines hub into Peterborough and announced plans to close the Newton Abbot depot.

In addition, the group said in its half year results: “Our flexible contractor base has allowed the group to adjust staff and distribution resources swiftly in response to the lower than anticipated sales volumes.”

Group underlying profit before tax increased by 11 per cent to £19.2m from revenues of £872.3m – down 5.2 per cent.

Smiths News was demerged from WH Smith in 2006 and took over Bertrams, the book wholesaler in 2009. It has an about 55 per cent of the UK’s wholesale newspaper and magazine market and 45 per cent of the wholesale book market.

Mark Cashmore, group chief executive said: “Our operational progress over the last six months has been pleasing. Despite a number of challenges across the Group’s markets, we have delivered a solid financial performance, increasing our confidence in achieving the full year consensus.”

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