Key facts
- WH Smith warned of further profit decline due to discounting and inflation.
- The company expects pre-tax profits between £75m and £90m this year, down from £90m-£105m.
- WH Smith raised £102m through a share sale to strengthen its balance sheet and pay down debt.
- Total revenue increased 5% on a constant currency basis in the 14 weeks to June 6, 2026, with like-for-like (LFL) revenue up 2%.
- LFL revenue in UK airports was flat, while North American airport revenues fell 2% year-on-year in the seven weeks to June 6.
- The company plans to close or exit 14 uneconomic fashion stores in North America and is considering options for its Welcome to Las Vegas business.
WH Smith has issued a profit warning for the second time, citing increased discounting and inflation headwinds that are impacting its margins. The company announced a trading update for the 14-week period to June 6, 2026, reporting a 5% increase in total revenue on a constant currency basis and a 2% rise in like-for-like (LFL) revenue compared to the prior year.
However, the retailer also revealed that revenues at its airport stores in the UK were flat in the seven weeks to June 6, while North American airport operations saw revenues fall 2% year-on-year in the same period. This decline is attributed to reduced passenger numbers following airfare inflation, a reduction in airline capacity linked to the Middle East conflict, and softer consumer demand.
As a result of these trading conditions and ongoing uncertainty, WH Smith expects pre-tax profits to be between £75m and £90m for the full financial year, a reduction from its previous guidance of £90m to £105m. The company has raised £102m through a share sale to strengthen its balance sheet, pay down debt, and invest in technology, while also planning to shut unprofitable stores.
Executive chair Leo Quinn stated that the company is implementing a "self-help" program to address underperforming areas, including exiting or renegotiating loss-making situations and transitioning some operations to a franchise model. The company is also considering strategic options for its Welcome to Las Vegas business and plans to exit 14 uneconomic fashion stores in North America. The company will also book a £150m non-cash impairment charge.
The company's shares fell significantly following the announcement. The situation is compounded by an ongoing investigation into an accounting scandal at its North American arm, which led to the resignation of its former chief executive, Carl Cowling, and is being investigated by the Financial Reporting Council and the Financial Conduct Authority.