WH Smith PLC

Thank you for coming and welcome to our preliminary results for the 12 months ending 31st of August. You all know me, I'm Stephen Clarke. You all know Robert, our group CFO and CO. Now, in response to requests from some of you who want to see more of our senior management, we've got a new presenter on the bench today, Carl Carling. Carl is the MD of our high street business. Apparently, some of you are a bit bored by Robert and me. Robert, I can understand. Try working with him for 15 years and see how boring that gets. So Carl will do the high street bit, I'll do travel, and Robert, of course, will do the numbers. But before that, a quick introduction. And I'm pleased to tell you that we've had another good year across the group, with total sales up 2% to 1.3 billion, and profit before tax of 145 million. The distinct strategies for each of our businesses continue to deliver. In travel, we've seen another good year of like for like sales growth in our UK business, helped by the ongoing growth in passenger numbers, but also driven by our initiatives to drive profitable sales. So this is now five years in a row of strong like-for-like sales growth in travel. Meanwhile, internationally, we continue to be very successful in winning new business with 42 new units won during the year. Now this strong growth in travel has transformed the WH Smith Group into a travel-focused retailer. And as many of you will know, travel now accounts for over half of our sales and two thirds of our operating profit. And it makes more profit in the second half than High Street does in a full year. However, High Street is still an important part of the group. It remains in good shape, despite the well-documented challenges in the UK high street, as our strategy, which is focused on sustainable profit and cash generation, continues to deliver. Underlying profit was in line with plan in high street. And indeed, in the second half, we saw profit grow year on year, helped by like for likes down just 2%. Now, despite the good performance from our high street business, we're not ignoring the challenging conditions being experienced on the UK high street more generally. And as a result, we've undertaken a detailed review of our high street businesses to ensure they remain fit for purpose now and fit for the future. And later on in the presentation, I'll come back to that. As always, value creation for shareholders remains central to our plans. And so we'll continue to focus on profitable growth, cash generation, and optimal use of cash whilst investing for the future. And as you'll all come to expect, we'll continue to manage the business tightly. So I'll now hand over to Robert to do the numbers.

Thank you, Steve. Let's start off with the group financial summary. The group has produced a strong performance in the year with both travel and high street performing well. Total group revenue was 1.3 billion, 2% higher than last year. Profit from trading operations at 163 million was up 5 million or 3% compared to last year with headline group profit before tax increasing by 5 million to 145 million, an increase of 4%. Headline earnings per share increased by 4%, reflecting the increase in profit, the higher tax rate as expected, and the lower weighted average number of shares in issue as a result of the return of cash to shareholders. Free cash flow generated in the year was 96 million compared to 105 million last year, and I'll come on and talk about the cash flow in more detail later. The board has proposed a final dividend of 38.1p, making a total of 54.1p for the year, an increase of 12%, which reflects the good business performance, our strong cash generation, and our confidence in the future prospects for the business. And today we've also announced a further return of cash of up to 50 million via a rolling share buyback. So turning first to revenue. Overall group revenue for the year was 1.3 billion, up 2% on 2017, with flat light-for-light sales. In the second half, we saw group light-for-light sales up 1%. Travel has delivered a strong performance, with total travel sales of 672 million, up 8%, driven by light-for-light sales, which were up 3%, and new space worth 5%. We saw good growth across our UK, air, rail, and hospital channels, reflecting the increase in passenger numbers and our initiatives. In international travel, we also saw good growth. Here, total sales grew by 22% to 132 million as we opened more directly run stores, and like-for-like sales grew by 4%. Second half like-for-likes in travel were up 3%, with the UK up three and international up four. As expected, high street light flight sales were down 3% in the year, with first half light flights down four, and despite the difficult market conditions, second half light flights down two. Including the changes in space, total revenue in high street was down 3% in the year. So looking by category, Stationery like for likes were up 3% in the year, with a good performance over Christmas, and then also at back to school. The second half saw stationery up 4%, helped by the slime phenomenon. Books like for likes were down 6%. As you know, publishing is the biggest driver of the performance of books, and there were no big publishing trends over Christmas 2017. We saw an improved performance in the second half. News and impulse like for likes were up 1%, We've seen good growth in our impulse and food-to-go ranges, and a good performance from World Cup stickers and Royal Wedding magazines. Books and news and impulse saw an increase in gross margin compared to last year, and in stage three the margin was slightly down, reflecting mix and a strong sales of digital ranges in travel. So turning to group profit before tax. Travel profits grew to 103 million, an increase of 7%, with UK travel up 5 million and international up 2 million to 11 million. Profit growth came from strong sales growth, 120 basis point improvement in margin driven by mix, and continued investment in our initiatives. As expected, high street profit decreased by 2 million in the year to 60 million, which included second half profits up 1 million compared to last year. In the high street business, we've continued to deliver gross margin improvements around 70 basis points and cost savings of 12 million during the year in line with our plan. So group profit from trading operations was 163 million, a 3% increase on the previous year. Central costs and net finance costs are in line with last year, and that leaves headline group profit before tax at 145 million, 5 million higher than last year, an increase of 4%. The effective tax rate was 18%, and we anticipate the tax rate to be around 19% for this year. Now, you will have noticed we have a few non-underlying items this year, so let me just touch on these now. So this year we have some non-underlying items. These include the cost of a potential acquisition outside of the UK that we chose not to complete and costs relating to a business review of the high street. Given the exceptional conditions on the high street, we've undertaken a detailed review of our high street businesses to ensure they're fit for purpose now and for the future. The review, which Steve will discuss in more detail later, had some costs relating to high street central costs, costs of winding down WH Smith local and card market, as well as closure costs and some onerous lease charges on a handful of high street stores, which we will now close. These items are not underlying due to their magnitude and one-off nature. However, as a result of the timing of the activity, we expect the cash and accounting charges to cross both the last financial year and the current financial year. The cost in last year was 11 million with a cash impact of 3 million, and we expect to charge around 5 million in the current financial year with a cash impact of about 5 million. So let's turn to profit from trading operations. With sales increasing by 2% and total gross margin increasing by 90 basis points, gross contribution for the group increased by 28 million to 761 million. Travel achieved a margin increase of around 120 basis points driven by mix. And in the high street, margin increased by around 70 basis points through category mix management representing around 60% of the increase with buying, sourcing, promotional and markdown management being the balance. we would expect continued margin growth in both businesses in the current year. In terms of costs in trading operations, as we continue to grow travel, the group sees an increase in costs. In travel, this is due to higher rents, rents being based on turnover, new stores in both the UK and internationally, and our continued investment in service and stores. However, across both businesses and all cost lines, we remain focused on cost efficiency and cost management. In High Street, we continue to identify cost savings. For example, in the year, we saw savings from our in-store operating model and from lower rent at lease expiry. We've worked hard over the years to inject flexibility into our lease portfolio. With an average lease length of around four and a half years, we have over 240 leases up for renewal over the next three years, right across the portfolio and the country. The cost base in High Street remains substantial at over 300 million, and we continue to see opportunities for further cost savings. And we'll also have the benefit from the High Street Business Review going forward. So turning to the cash flow. We delivered a cash flow of 96 million in the year, slightly lower than last year due to higher investment capex, some working capital investment, and higher tax payments as a result of higher profits. CapEx spend was 53 million, 5 million higher than last year, mainly as a result of our continued investment in stores. In the period, we made CapEx investments in travel with 20 new stores in the UK and 29 new directly run stores internationally in our in-store operating model and in High Street with our store format trials. Looking ahead, we expect capex to be around 50 million each year over the next three years, although this will depend on the amount of new business that we win. Non-cash items primarily include share-based payment charges. So if we look at the net position, the group continues to have a strong cash position with net debt of 2 million after the share buyback. In addition to the 96 million of free cash flow generated, the group has seen a net cash outflow relating to non-trading operations, which includes 54 million of dividend payments, net ESOP trust payments of 3 million, and contributions to the pension scheme of 3 million. Our capital allocation policy remains unchanged. We'll invest in the business through CapEx, working capital, including investment in new travel sites and other opportunities, such as the 2 million we invested in CalPens and the 3 million investment in our international joint venture businesses. And we return excess cash to shareholders via dividends and an on-market share buyback. We continue to see the cash generative nature of both travel and high street as one of the strengths of the group. And so to the balance sheet. We have a strong balance sheet with net assets of 212 million, 25 million higher than last year, primarily due to our investment in CapEx. So let's look now at the return of cash to shareholders. In the context of that strong balance sheet and our high levels of cash generation, we continue to utilize our cash with our disciplined approach to capital allocation. Investing in the business and new opportunities, where we see an attractive rate of return, and we expect to spend around 50 million on CapEx this year, making appropriate acquisitions, and at the same time, we have a consistent record of growing dividends and returning cash as part of our long-term strategy to create value for shareholders. We continue with our previously outlined dividend policy, with total dividend increasing by 12%. We've now grown the dividend every year since demerger from 11.8 P in 2007 to 54.1 P for 2018. And we've announced today our intention to make a further return of cash of up to 50 million to shareholders via non-market share buyback. So throughout a combination of ordinary dividends, buybacks, and a special dividend, we will have returned over 1 billion to shareholders since the 2007 financial year, with 80 million returned last year. And since 2006, we've retired 40% of our equity. So finally, to recap, here are the group key indicators, most of which I've touched on already. But let me just mention fixed charges cover, which is unchanged at 1.7 times, and return on capital employed after capitalized lease costs, which was 26%, slightly higher than last year. Steve will now discuss the operational performance.

Thank you, Robert. All right, on to travel. And travel delivered another strong performance. Total sales up 8% and like for likes up three. As I said earlier, this is the fifth year in succession of good like for like growth and reflects our ability to manage our space, develop our ranges and evolve our formats to best meet changing customer needs. Profit for the year was up 7% to 103 million pounds. And as you know, we've made significant investments in our travel business over the past five years. This investment has been a key driver of our like-for-like sales performance, along with the growth in passenger numbers. And importantly, we continue to see investment opportunities to drive the UK business forward in the years ahead. As usual, we worked hard at managing costs and margins. And we've had a pretty good year on gross margin, up 120 basis points, driven mainly by category mix management. And looking to new space, we continue to invest in new stores, both here in the UK and overseas. We opened 20 new shops in the UK this year and 142 units internationally. And we expect to open another 15 to 20 shops in the UK this year. So let's go on to channel performance. And in UK air, total sales were up 7% with like for likes up four. This is another strong performance in air, despite a slight softening in passenger numbers as the summer progressed and late bookers decided that the UK sun was reliable and hot enough to stay here. In real, total and like for like sales are up 1%. Now, this real performance was hit particularly hard by the snow in the first half of the year, with many lines and stations closed for a number of days. And we continue to see ongoing disruption from upgrading the network and the introduction of timetables, the new timetables. In our hospital channel, total sales were up 6%, but like for likes, up 3%. Now, this reflects our new store openings, including M&S Simply Food Stores and our growth initiatives. Now, this is particularly pleasing in a period where we've changed our ranges and our offers to reflect the healthy eating guidelines from the NHS. In our international business, total sales were up 22%, with like for likes up four. And I'll come to that in a moment. Now, of course, as you all know, as sales and passenger numbers grow, our variable costs, particularly rent, will increase also. So let's look at the UK in a bit more detail. And in UK, airports have been an area of significant investment for us. This includes our ongoing work on space management and category mix management, as well as the work we've been doing on the large store formats that will position us well for the future. In some of our largest airport stores, we can complete over 100,000 transactions in a busy week. I mentioned to you earlier in the year that our large airport format trial is an area of focus for us and that we'd seen particularly good results from our first store in Gatwick South. Our experience continues to show that we can deliver superior sales per passenger from larger footprints, which enable improved customer circulation and lead to higher customer conversion. Now during the half, we launched a further two new large store formats, this time in Gatwick North and Heathrow Terminal 3, and currently we have an extended four in Heathrow Terminal 4 being built. I'm pleased to say that all large format stores are delivering good results, and we expect to do more of these as we go forward. We believe this new compelling offer will be of interest to more landlords as they reconfigure their space. So on the screen, you can see our new stores in Gatwick North and South. Both stores are trading well, as I said, and they are helping us deliver sales growth in Gatwick well ahead of passenger number growth. And on this slide, you can see our new store in Heathrow T3, where again, sales are growing ahead of passenger numbers. All of these stores incorporate our most up-to-date thinking and store design, and the larger footprint allows better category segmentation and improved customer flow. The performance that we're seeing across these new stores is helping us to renew and extend our contracts in the UK, and that's really critical for us, as well as securing new space as it becomes available. But we're also investing in our railway channel. As you know, we already have a very strong presence in large mainline rail stations with our traditional WH Smith format and we continue to explore new space opportunities as well as invest to improve or to provide new formats to landlords as they reconfigure their existing space. During the year, we've continued to develop our book offer and our tech express format with enhanced departments, including larger footprints, new fixtures, improved ranges, and specialist staff in some of our biggest stores. And during the second half, we opened a fantastic new bookshop in London Bridge, which you can see on the left of the screen. We've had some great feedback from the landlord, publishers, and our customers, and are seeing some really encouraging results here. And we also opened standalone tech express units in Waterloo and London Bridge stations during the year. And on the screen there, you can see the one in London Bridge. So going on to hospitals. And the hospital channel is an increasingly important business for us. Over the past number of years, we've invested in new stores, new formats, new partnerships to drive this channel forward. The resulting growth means that hospital sales are likely to overtake railways as our second biggest channel this financial year, and importantly, with much more scope for growth. Food and drinks are a very large part of the mix in hospitals. And increasingly, landlords are looking for a customer offer that meets their healthy eating guidelines. Over the last couple of years, we've worked hard to create an improved and healthier sandwich range, the largest in the market, specifically for our hospital stores where, on average, about 80% of our sandwiches are now under 400 calories. This has been very well received by both the hospital trusts and NHS England as we continue to support their healthy eating programmes. You'll remember in April that I spoke about a new format that includes an M&S food to go range implanted within the main WH Smith footprint in hospitals. Well, we now have four of these stores open in Alder Hay, Kings Mill, East Surrey and North Middlesex hospitals, and they're all trading really well. And I'm pleased to tell you that we've recently agreed to convert a further 11 stores to this format. We expect to see around four to five of these open during the autumn, with the balance opening in the second half. Now, in addition to the M&S implant stores, we'll open a new Simply Food store at West Middlesex Hospital in the next couple of months. This follows four Simply Food stores opened in the second half of last year, and that takes our number of standalone M&S Simply Food stores and hospitals to 21. So finally for the UK, looking ahead. And whilst there's some uncertainty in the broader economic outlook, most airports are continuing to forecast low single digit growth for the rest of this year and next, although as always, the forecasts do vary by location. In addition, we'll continue to invest in new stores across all our channels. As I said, during the year, we opened 20 new stores in the UK. And in the current financial year, we expect to open another 15 to 20 new stores, while at the same time driving sales per passenger in existing stores through investment in improvements to customer offer and active space and category mix management. And of course, the UK isn't the only source of growth. So let's move on to international. Our international business is profitable and growing fast. The WH Smith brand and offer continue to be well received by both customers and landlords. And where we open new stores, sales per passenger continue to be very strong. Total sales for the year internationally were £132 million. This is up 22% versus the previous year, driven by our new stores. Like for likes, we're up 4%. We've had some really good success winning new business during the year. We won 42 new units in total, which is our best tally for a year so far, and it includes a couple of significant wins for us. We've also opened all of our stores in Changi Airport in Singapore, where we now have 10 stores open, and we're pleased to have opened all six stores in Rome and eight in Madrid, which opened at the back end of the financial year. So at the end of the year, we had 286 shops open internationally. Profit from international was £11 million, which is £2 million ahead of last year. On the screen here, you can see an image of our recently opened store in Madrid airport. This is one of eight stores won and opened over the summer in the international IAG terminal. Coupled with our wins in Alicante and Tenerife, we now have 13 shops across Spain, which we directly run ourselves. And in April, we announced that we'd won our first stores in South America in Rio. Three of the seven stores are now open and trading well, and you can see a picture of one of them on the screen. During the second half, we also want to further four units in Brazil in São Paulo Airport. São Paulo is the largest airport in South America with around 40 million passengers each year. And as we've done in Rio, we'll open these stores as a joint venture with Duty Free Americas, who have an extensive network of stores throughout the region. So at the end of the financial year, we were present in 50 airports, 27 countries outside of the UK, with Europe now the biggest territory with 77 units open. And we continue to utilize the three operating models with 52% of open units franchised, 40% directly run, and the balanced JVs. So finally on international looking ahead, and as you know, the international travel market is very large and continues to grow. WH Smith is still a small player in this market with a small market share, but we are profitable and we're growing fast. And while it will require some investment in new stores and infrastructure, there's great potential for us to continue growing over the long term. Our experience to date is that our brand, customer offer, and ability to drive sales per passenger are attractive to overseas landlords. We'll continue to focus on and build critical mass in our emerging hubs while ensuring we go for all sensible opportunities to further grow the business internationally. Our recent investment in strengthening the leadership team across the group, with Carl in High Street, Toby Keer heading up UK travel, and Phil McNally heading up international, means that the international business gets the focus it requires as it continues to grow both in size and complexity. So that's it for travel. Now before I hand over to Carl, a quick word from me on the High Street strategy and how we're thinking about that going forward. Now those of you familiar with our high street strategy will know that our forensic approach to how we run the business, be that space management, margin growth, or cost efficiencies, has enabled us to prosper when many other retailers have failed. Indeed, we've delivered profit growth in 13 of the past 15 years in our high street business, despite the significant economic challenges and the many structural shifts that we've experienced both in our categories and in the high street in general. And this year has been no exception. Our profit of 60 million pounds is the third highest in those 15 years, beaten only by the past two record years of 62 million, which, as you remember, was driven by exceptional publishing in the form of adult coloring in the first year and adult humor books in the following year. Our purpose in High Street is to deliver good, sustainable profit and excellent cash generation. And whilst we have had another successful year, we can't ignore the challenging conditions currently being experienced on the high street more generally. And so we've undertaken a detailed business review to ensure we remain fit for purpose now and fit for the future. The result of this review is that our successful strategy remains unchanged. However, we have created a plan that enables us to deliver a better structure for the business for the future by focusing on our core business, winding down the non-core trial initiatives of Cardmarket and WHSmith Local, restructuring some of our operations, and dealing with a handful of loss-making stores which will close at lease end. This plan will deliver benefits in the current year and beyond while we continue to drive value from our space, margin and cost initiatives, third party partnerships like the post office and our online businesses. At the same time, we'll continue to invest appropriately in our high street stores and particularly in stationery to drive the business forward. So Carl will now add more colour to that as he takes you through the high street business update.

Thank you, Steve. As Steve has just said, we have delivered another good performance in the year. Like-for-likes sales were down 3% with profits of 60 million in line with guidance. And second half like-for-likes were down 2% despite a challenging summer period driven by the effect of the hot weather and the World Cup. Gross margin was well managed at 70 basis points in the year. We continue to invest in stationary to grow the category, and I'll come on to this shortly. And we continue to drive good results from our cost savings. So let's look at that in a bit more detail. I will begin with the usual margin and cost slides, and then I'll move on to some category and wider initiatives. And as usual, we've worked hard at managing the margin, delivering an improvement of 70 basis points in the year. As in previous years, the biggest contributor to this margin improvement continues to be category mixed management, both across categories, but also within categories as a result of our active space management and the resulting growth in stationery. Additional margin improvement has come from better trading terms and sourcing, and improved markdown management in stationery. Turning now to costs. As the shape of our high street business changes, we continue to identify sustainable cost efficiency initiatives, while also adjusting our variable cost to sales. During the year, we delivered savings of 12 million pounds. As usual, these initiatives come from all parts of the business. For example, rent savings at lease renewal, marketing efficiencies, benefits from the business review, productivity gains from our distribution centers, and of course, the variable cost to sales. Even with years of savings, the high street cost base is still substantial, so we continue to build a healthy pipeline of trials for future initiatives, particularly investing in technology to drive further efficiencies in the store operating model. You can see on the table our latest forecast for cost savings up to 2021. Since last year, we have identified a further £10 million of savings, giving us a total of £19 million over the next three years. Moving on now to category performance and starting with books. In books, the market remains fairly stable. As we have said many times before, publishing is the biggest driver of market performance for physical books. And last Christmas was a pretty tough one for us, as we didn't benefit from any publishing phenomena like we had over the previous couple of years with adult coloring and then the humor book craze, which helped us to deliver record profits and then match those record profits. That said, during the second half, our books performance started to improve, driven by great performances from the likes of Dan Brown's Origin and David Walliams' World's Worst Children 3, where we were the number one retailer in the market when they launched. In addition, we have made good inroads in improving our in-store customer proposition through ease of browsing and deployment of book recommendations. Our approach to the books business goes unchanged. We will continue to build on our areas of relative strength to make WH Smith High Street the home for light readers, kids, and educational books, whilst at the same time driving the overall net profitability of the category by improving the efficiency of the books operating model. Moving on now to stationery. As you know, stationery is our most attractive category. It accounts for around half of high street sales and 60% of store contribution. Stationery remains an important part of investment in our high street business and a key driver of profit growth. And investment in our post office partnership and our digital channels, both of which we see as good areas of future growth, will help drive stationery performance into the longer term. But more on that in a few minutes. So we've had a good year in stationary with many of our initiatives driving good light for light sales growth. As you know, we reset our stores at least twice a year to optimize the return at every single meter drop in every store. Stationary continues to be the main beneficiary for the space changes in the year with more space in many stores and also better quality space towards the front of most of our stores. This additional space combined with strong promotional offers and our increased focus on design, fashion and product quality has helped us deliver a strong performance. We also worked hard at identifying new and emerging trends and are able to adapt quickly to establish ourselves as market leaders in the latest phenomena in our markets. In previous years, we have driven strong sales as a result of trends such as adult coloring, and in the second half of this year, we responded quickly to the slime phenomenon by creating a one-stop-stop solution for customers to purchase pre-made slime, but also do-it-yourself slime kits. This ability to react quickly and become a market leader was a key component of driving our strong sales performance in the year. And our investment in stationery is not restricted to just range development and store environment. In April, we updated you on our new concept store trial in the High Street where we are making dramatic improvements in our store shopping environment, store layout, fixtures and display to better highlight and showcase our stationery ranges. Since we last updated you, we now have 11 stores refitted as part of this trial in locations such as Winchester, Cheltenham and the Trafford Centre. The results have been encouraging and we are currently looking to extend the trial to a further 10 stores. We've also developed a trial for smaller stores, as well as a low cost option in locations such as Marlow and Henley-on-Thames. The results from this trial have also been encouraging. You can see an example of a larger refit store in Winchester on the left of the screen, and a smaller store refit in Henley on the right. We will continue to monitor the results of these stores closely, and of course, we will keep you posted. Moving on now to a quick update on our digital channels. Starting with funkypigeon.com, we've had another good year here with strong performances over the key trading periods. We saw increased traffic volumes with our focused marketing investment, and conversion has continued to be strong as we have developed the website and app. Our extended gifting range has performed well, and our fulfillment center in Guernsey enabled us to meet record levels of demand for both gifting and greeting cards over the key events in the year. Last year, we also acquired Cult Pens, and we are making good progress in developing the Cult Pens business and growing sales. Cult Pens is the leading online specialist pen retailer with over 18,000 products available on its website. This acquisition complements our existing stationery ranges in both our high street stores and online at whsmith.co.uk, as well as enhancing our customer offer. During the year we have also been increasing our focus and prominence of stationary ranges on our whsmith.co.uk website, particularly over the key back to school period. This has seen the mix of stationary sales on the website increase by around 10%. And finally in the high street, a quick update on our third party partnerships. As you know, our partnership with the Post Office is an important part of our High Street business model. It helps us to maintain our relevance with customers, drives footfall, and of course provides financial benefits through our commercial arrangement, all of which contribute to a more sustainable financial outcome for the individual Post Office stores, despite the lost sales from the space assigned to the Post Office footprint. We currently have 135 franchise and 33 hosted post offices open in our high street stores and today I'm pleased to announce that we have agreed a new deal to open a further 40 post office stores across our estate and convert the 33 hosted to franchised bringing the total to over 200. Subject to public consultation these new post offices will open over the course of 2019. And today, we're pleased to announce an extended partnership with Incom. As some of you may know, we have a very successful and long-standing history of selling prepaid gift cards through our in-store gift card mall. And we have recently signed a new agreement with Incom, the leading distributor for PlayStation, Xbox, and Nintendo gift cards, to install digital gaming hubs in all of our high street stores. In these hubs, we will sell prepaid cards for the latest games releases, as well as prepaid software gift cards for digital downloads. You can see an example on the screen. The market is large and growing, and with our partners, we are looking to establish WH Smith as the retailer of choice for prepaid games and digital downloads. The hubs have all gone into stores over the past month or two, so we will update you on progress at the interims. So that's it for the high streets. I'll now hand back over to Steve.

All right, we've had another good year. Our strategy has been and continues to be very effective in creating value for our shareholders. Good like for like sales growth in travel has come on top of strong growth last year and the past few years. And our UK business has further growth opportunities as we continue to invest and actively manage our space. In addition, our international business is profitable, growing fast, and we continue to win new business at a really good rate. Our growth in travel, both here and overseas, means that travel is the largest part of the group in both sales and profit, and as I've said, with much more scope for future growth. But our high street strategy is successful, and it remains unchanged. We continue to deliver on our margin growth and our cost savings, and there's more to go. And we continue to work on how we use our space and external partnerships to best deliver the strategy. The group continues to be cash generative, and we're also proposing an increase to the final dividend of 13%, which further demonstrates the board's confidence in the future prospects of the business. Going forward, whilst the broader economic environment remains uncertain, we've had a good start to the new financial year in both high street and travel, and we'll invest for the long term while continuing to be disciplined with our capital allocation in order to maximise the contribution from both businesses and deliver best value for our shareholders.