WH Smith profits fall 30%: what the reset means for UK travel shops

WH Smith, the travel retailer that runs the newsagent and convenience shops found in most British airports, mainline railway stations and NHS hospitals, said on Thursday that its headline profit fell by almost a third in its latest financial year. The company reported headline profit before tax and non-underlying items of £76m for the 12 months to 31 August 2026, against £108m a year earlier, according to its preliminary results statement published to the stock market at 7am.

Revenue still rose, by 5% to £1,625m, with like-for-like growth of 2%. The gap between rising sales and falling profit is the story of the year: higher rents on renewed airport contracts, inflation in wages and costs, a softer consumer and more discounting all took a bigger share of each pound spent at the till.

The results are the first full-year numbers under Leo Quinn, the turnaround specialist who took charge as executive chair in April. He used the statement to set out what he called a “fundamental reset” of the group, and shares fell about 7% in morning trading, according to the Independent and Alliance News.

What did WH Smith report for the year to August 2026?

The preliminary results cover WH Smith’s first full year as a pure travel retailer, after it sold its UK high street chain in 2025. The group now trades in three divisions: the UK, North America, and a “Rest of the World and Other” division that includes directly run and franchise stores abroad.

Headline profit of £76m landed at the bottom of the £75m to £90m range the company had guided to in July, Alliance News noted. In September the retailer had already warned that profit would come in at the lower end of its forecast, citing weaker travel demand, inflation and increased promotional activity, Retail Gazette reported.

The table below sets out the main figures from the results statement. “Headline” measures are presented by WH Smith before the IFRS 16 lease accounting standard and before non-underlying items, which is the basis the company uses for its guidance.

Measure	Year to Aug 2026	Year to Aug 2025	Change
Group revenue	£1,625m	£1,553m	+5% (LFL +2%)
UK revenue	£870m	£834m	+4% (LFL +2%)
North America revenue	£437m	£413m	+6% (+9% constant currency)
Rest of the World and Other revenue	£318m	£306m	+4% (+1% constant currency)
Headline trading profit	£130m	£159m	Down £29m
Headline trading margin	8%	10%	Down 2 points
Headline profit before tax and non-underlying items	£76m	£108m	Down 30%
IFRS (statutory) result before tax	Loss of £107m	Profit of £2m	Swing of £109m
Headline diluted earnings per share	30.3p	43.4p	Down 30%
Free cash flow	£52m	£63m	Down £11m
Headline net debt	£325m	£390m	Down £65m
Dividend for the year	None declared	Final of 6.0p	Suspended

Net debt fell mainly because of a £103m equity placing in June, when WH Smith sold new shares to investors to shore up its balance sheet. Leverage, measured as headline net debt against headline earnings before interest, tax, depreciation and amortisation (EBITDA) of £166m, came in at 2.0 times, slightly lower than 2.1 times a year earlier.

The board did not declare an interim or final dividend for the year. That is a clear break for a company that paid total dividends of £43m in its 2025 financial year and only £8m this year, all of it the 6.0p final dividend left over from 2025.

Why the profit figures look different in different reports

Readers comparing coverage on Thursday may have seen at least four different profit numbers. City AM reported a £73m pre-tax profit and said WH Smith had missed even its lowered £75m target, while Retail Gazette, the Independent and Alliance News led on £76m, in line with guidance. Proactive cited £180m of exceptional charges, while other outlets cited £164m.

All of these figures appear in the results statement. The difference is the accounting basis, as the next table shows.

Figure	Basis	2026	2025	Who led on it
Profit before tax and non-underlying items	Pre-IFRS 16 (“Headline”, the basis of company guidance)	£76m	£108m	Retail Gazette, Independent, Alliance News
Profit before tax and non-underlying items	IFRS 16 (lease accounting applied)	£73m	£102m	City AM
Non-underlying items	Pre-IFRS 16	£164m	£92m	Most outlets
Non-underlying items	IFRS 16	£180m	£100m	Proactive
Loss before tax	IFRS 16 (statutory)	£107m loss	£2m profit	All outlets
Loss before tax	Pre-IFRS 16	£88m loss	£16m profit	Results statement only

Put simply, WH Smith says it met the bottom of its guidance on the measure it guides on, while City AM’s reading uses the statutory lease-adjusted figure, which falls just short of £75m. Neither reading is wrong, but the comparison with guidance only works on the pre-IFRS 16 basis the company itself used.

How did the WH Smith shops at stations, airports and hospitals perform?

The UK division is WH Smith’s largest, producing more than half of group revenue and, on our calculation from the divisional figures, about 82% of headline trading profit before central costs. It runs shops in three main locations: airports, railway stations and hospitals, plus a smaller franchise and other estate.

Hospitals were the standout. Revenue in hospital shops rose 9%, with like-for-like growth of 6%, which the company put down to its multi-format offer and third-party partnerships. Air and rail lagged well behind.

UK channel	Total revenue growth	Like-for-like growth	Stores at 31 Aug 2026
Air (airports)	+4%	+1%	163
Hospitals	+9%	+6%	154
Rail (stations)	+3%	+1%	101
UK division total	+4% (to £870m)	+2%	572 (incl. 154 franchise and other)

UK headline trading profit fell from £130m to £107m. WH Smith said this reflected disruption from its store development programme, higher rents after competitive airport contract renewals, labour inflation and wider economic pressure. On our arithmetic, UK trading profit as a share of UK revenue dropped from about 15.6% to about 12.3%, close to the “around 12%” net margin the company itself cites.

WH Smith described the year as its largest ever UK store development programme. Refurbished “one-stop-shop” stores opened at Heathrow Terminals 3, 4 and 5, and at Liverpool, Belfast and East Midlands airports, bringing travel essentials such as food to go, drinks, health and beauty, books and technology accessories under one roof.

The company said it had won additional health and beauty space at Heathrow’s three terminals and East Midlands from “the incumbent health and beauty retailer”, which it did not name. More than 80% of UK airport contracts are now secured on medium to long-term agreements, giving better space but at higher rent.

Airport like-for-like sales were also hit by trading disruption while the refits took place, and by the conflict in the Middle East in the second half, which the company says affected air travel. City AM attributed the travel disruption and higher cost of flying to what it called the Iran war.

How many WH Smith shops closed in the UK this year?

The UK estate shrank from 593 shops to 572 over the year. WH Smith opened eight UK shops and closed 29, according to the store numbers table in the results statement.

Estate	31 Aug 2025	Openings	Closures	31 Aug 2026
UK Air	176	4	17	163
UK Hospitals	154	2	2	154
UK Rail	105	1	5	101
UK Franchise and other	158	1	5	154
UK total	593	8	29	572
North America Travel Essentials	151	26	5	172
North America InMotion	123	7	15	115
North America Resorts	88	0	26	62
North America total	362	33	46	349

Most UK closures were at airports, where 17 shops shut against four openings. That fits with the refit programme: when airports retender their retail space, operators often consolidate several small units into fewer, larger stores. WH Smith did not publish a list of the individual UK shops that closed.

These closures are separate from the closures under way at TG Jones, the former WH Smith high street chain, which has been shutting shops under a court-approved restructuring plan. Our report on the TG Jones September closures and the Post Office counters at risk set out how that programme works, and it involves a different company with a different owner.

What is Leo Quinn’s “fundamental reset” of WH Smith?

Mr Quinn, who previously led turnarounds at the construction group Balfour Beatty and the defence company Qinetiq, according to City AM, did not soften his verdict on the business he inherited. “It is clear from this that forced growth delivered a complex and siloed group structure without scalable benefits,” he said in the statement.

“This resulted in increased costs, too many loss-making stores, acquisitions not integrated effectively and high organisational complexity,” he added. He also stressed what he called the group’s “significant strengths: a strong and recognised brand, attractive market positions, prime locations and a dedicated team”.

Cost base, store estate and systems

The programme has three investment strands, according to the results statement: restructuring the cost base and finding operational efficiencies, rationalising the store estate to exit loss-makers, and spending on systems and back-office infrastructure. Alongside that, the company wants to improve cash generation through better inventory control, working capital and commercial terms with suppliers.

Transformation, restructuring and store closure costs came to £41m in the year, part of the £164m of non-underlying charges. WH Smith expects programme costs to run until 2027/28 and guides to about £30m of non-underlying profit and loss charges in the coming year, with about £40m of related cash outflow.

The Independent reported that the company has not said how much the overhaul will save each year, and has not said whether there will be any impact on jobs. In the UK, the statement refers to “store and support centre restructuring” as one of the cost savings that partly offset rent and wage pressures, but gives no headcount figure.

What is leaving the group

Most of the retrenchment is abroad. In North America, WH Smith closed 26 Resorts stores during the year, largely fashion and speciality shops in Las Vegas, and expects to exit the remaining fashion stores by April 2027. It plans to close about 50 loss-making or marginally profitable InMotion electronics stores over the medium term, and says future InMotion openings will be limited.

In its Rest of the World division, the company has left Düsseldorf and Oslo airports and will exit the Netherlands, Sweden and Denmark during the 2027 financial year. The Independent reported that the international business will focus on three directly run countries, Ireland, Spain and Australia, with other markets moving to franchise partners or being exited.

The fastest-growing part of the business is the one closest to the UK model. North American Travel Essentials stores, which replicate the British one-stop-shop format, grew revenue by 23% at constant currency and now make up about 60% of North American revenue, with 26 new stores opened in the year and about 40 more already won.

The accounting scandal behind the reset

The reset follows a troubled 2025 and 2026. Last year WH Smith disclosed an accounting error in its North American division, which TheBusinessDesk described as a £30m error and City AM said had flattered profit in the region for years. The shares fell sharply at the time and the company issued a series of profit warnings.

The results statement says the group continues to cooperate with the Financial Conduct Authority (FCA), which is investigating whether the company complied with UK listing principles and rules and the disclosure and transparency rules in relation to matters announced on 19 November 2025. WH Smith says its remediation plan, covering governance, controls and systems, is “well advanced”.

The June share placing, which raised £103m, came alongside a second profit warning that Retail Gazette linked to travel chaos and Proactive linked to a slump in airport passenger numbers. The money reduced debt and paid for the self-help programme now under way.

Why are trading conditions harder for travel retail shops?

Travel retail is often described as resilient because passengers have time to kill and limited choice. WH Smith’s results show the limits of that argument when costs rise faster than spending per passenger.

Airport operators tender their retail space competitively, and WH Smith says renewals in a “more competitive environment” pushed up rents. It expects those higher space costs to keep weighing on profit in the near term, and hopes to recover them through stronger commercial execution and a leaner operating model.

Labour inflation also features prominently. Like every UK retailer with large numbers of hourly paid staff, WH Smith faces another increase in wage floors from April, which we covered in our report on the National Living Wage rise and what it costs shops.

On the sales side, the company said weaker consumer sentiment in the second half “resulted in increased promotional activity and a reduction in brand marketing”. City AM summarised this as WH Smith being forced to cut marketing spend and discount more products. The statement links the fall in brand marketing, and in supplier income, to a more cautious approach from suppliers against the economic and geopolitical backdrop.

WH Smith says it spent recent years building food-to-go and health and beauty ranges quickly. The focus now is on optimising them: refining food-to-go ranges to reduce waste and rationalising health and beauty to concentrate stock on the best-selling lines.

For a traveller, that is likely to mean fewer but better-stocked lines on the shelf rather than a wider choice. The stated aims of “capturing more value from premium locations” and increasing “spend per passenger” through basket size point to bundles, meal deals and add-on purchases at the till, though WH Smith has not announced any specific price changes.

What happened to the WH Smith shops on the high street?

WH Smith sold its UK high street business to the private equity firm Modella Capital in 2025, which renamed it TG Jones. The deal left the listed WH Smith group with only its travel estate, which is why it is now moving its financial year-end from 31 August to 31 December: without the high street shops, the busiest trading weeks are no longer the back-to-school and Christmas periods that drove the old calendar.

TG Jones has since used a restructuring plan to cut rents and shut shops. As we reported, up to 150 of the roughly 450 shops Modella acquired are expected to close, including all 70 that contain a post office, in our analysis of the TG Jones post office closures due by 2027.

Thursday’s results do not change anything at TG Jones, which reports separately and has its own owner. The only high street items in the WH Smith accounts are £2m of final separation costs and £14m of cash outflows relating to the sale, booked as discontinued operations.

Which WH Smith shop belongs to whom?

The confusion is understandable, because many TG Jones shops kept WH Smith fixtures and some customers still use the old name. The table below sets out the split as it stands.

Shop type	Brand on the fascia	Owner	Covered by Thursday’s results?
Airport shops (UK)	WHSmith	WH Smith PLC	Yes (UK Air, 163 shops)
Railway station shops (UK)	WHSmith	WH Smith PLC	Yes (UK Rail, 101 shops)
Hospital shops (UK)	WHSmith and partner formats	WH Smith PLC	Yes (UK Hospitals, 154 shops)
Former high street shops	TG Jones	Modella Capital	No
Post office counters in former high street shops	Post Office inside TG Jones	Modella Capital (host), Post Office Ltd	No

What does it mean for shoppers at stations, airports and hospitals?

For most people, the WH Smith they will use this Christmas is the one at a departure gate, a station concourse or a hospital entrance. The results suggest that estate is not shrinking quickly in the UK: closures were concentrated in airport refits, and the hospital estate was stable at 154 shops.

The company’s UK guidance for the year to August 2027 is for revenue to be “broadly flat” and the UK trading margin to stay at around 12%. That points to a business trying to hold, rather than grow, sales, while squeezing more profit from each shop through cost cuts and range changes.

Shoppers should not expect a wave of UK station or hospital closures on the strength of these results; WH Smith’s stated closures are mostly in North America and continental Europe. However, the company says it wants to exit loss-making stores across the group, and its UK shops sit on airport and rail contracts that are retendered over time.

Your consumer rights in a travel shop are the same as in any other UK shop. Under the Consumer Rights Act 2015, goods must be of satisfactory quality, fit for purpose and as described, and you have 30 days to reject a faulty item for a full refund. Changing your mind about a non-faulty purchase is a matter of the shop’s own returns policy, which is often stricter in travel locations because customers rarely come back.

How do WH Smith’s results compare with other UK retailers this autumn?

WH Smith reported on the same morning as B&M, which posted a much stronger picture, as we set out in our report on B&M’s half-year results and UK sales growth. The comparison with other big names reporting in recent weeks shows how unevenly the UK consumer is spending.

Retailer	Period	UK sales measure	Profit direction
WH Smith	Year to 31 Aug 2026	UK LFL +2%; first 10 weeks of new year +1%	Headline PBT down 30% to £76m
B&M	26 weeks to 26 Sep 2026	UK LFL +0.4% for the half; second quarter +3.2%	Adjusted PBT up 16.6% to £121m
Primark (ABF)	Year to Sep 2026	UK LFL +0.5%	Adjusted operating profit down 12% to £1,005m
Next	Third quarter 2026	UK full-price sales +2.0%	Full-year PBT guidance held at £1,255m

The pattern is that sales growth in the low single digits is now the norm for large UK chains, and profit depends on how well each one manages wage, rent and energy costs. Primark’s figures, which we covered in our report on Primark’s profit fall in its annual results, show that even a value leader can see profit fall when like-for-like sales stall.

WH Smith’s particular problem is that it sits on fixed, expensive sites. When passenger numbers or spending per passenger soften, it has less room than a high street or out-of-town retailer to move, cut space or renegotiate rent mid-contract.

What happens next for WH Smith, and when?

For the year to August 2027 the company expects headline profit before tax and non-underlying items of £75m to £85m, “in line with current market expectations”, and weighted towards the second half. Alliance News pointed out that the £80m midpoint is below the £84m that JPMorgan cited as market consensus, which helps explain the fall in the shares.

Headline net debt is expected to be around £320m by August 2027, with capital expenditure of about £85m and leverage held at about 2.0 times. WH Smith says it will review shareholder returns “in the medium term”, which means no promise of a dividend soon.

Trading since the year end

Trading in the first 10 weeks of the new financial year, to 7 November, was flat on a like-for-like basis for the group, with total constant-currency revenue up 1%. WH Smith said this was in line with its expectations and reflected softer consumer demand and lower passenger volumes in North America.

10 weeks to 7 Nov 2026	Total revenue	Constant currency	Like-for-like
UK	+3%	+3%	+1%
North America	+2%	+2%	-5%
Rest of the World	-7%	-8%	+2%
Group	+1%	+1%	0%

Alliance News noted that this is a slowdown from the 2% like-for-like growth WH Smith reported in the fourth quarter of the year just ended. In the UK, the new year has begun slightly better than the full-year like-for-like rate for airports and rail, but well below the 6% the hospital estate managed over the year.

The North American like-for-like decline of 5% is the weakest number in the statement. WH Smith links it to fewer passengers, which matters because North America is where most of the closure programme and most of the planned new Travel Essentials openings sit.

The change of year-end produces an unusual reporting calendar, set out in the results statement.

Date	Update
26 January 2027	Trading update with group revenue (covers Christmas trading)
April 2027	Interim results for the six months to 28 February 2027
April 2027	Target date to complete exit of Resorts fashion stores in North America
Early September 2027	Trading update with group revenue
Mid-October 2027	Second interim results for the 12 months to 31 August 2027
March 2028	Final results for the 16 months to 31 December 2027

The January update will be the first test of whether the UK estate can hold its like-for-like growth through the Christmas getaway, the busiest period for station and airport shops. The FCA investigation remains unresolved, and any outcome would be a separate announcement.

Frequently asked questions

How much profit did WH Smith make in 2026?

WH Smith made a headline profit before tax and non-underlying items of £76m in the year to 31 August 2026, down 30% from £108m. On a statutory basis, after £164m of impairments, restructuring and other charges, it made a loss before tax of £107m, compared with a £2m profit the year before.

Is WH Smith closing shops in the UK?

The UK estate fell from 593 to 572 shops in the year, with 29 closures and eight openings, most of them at airports during a refit programme. WH Smith has not announced a UK closure list; its stated closure programme is mainly in North America and continental Europe.

Does WH Smith still have high street shops?

No. WH Smith sold its UK high street business to Modella Capital in 2025, and those shops now trade as TG Jones. The listed WH Smith group runs only travel shops in airports, railway stations and hospitals, plus franchise and international stores.

Why did WH Smith’s profit fall when sales went up?

The company blamed higher rents from competitive airport contract renewals, labour and cost inflation, disruption while stores were refitted, and weaker consumer sentiment that led to more promotions and less supplier marketing income. The UK headline trading profit fell by £23m to £107m even as UK revenue rose 4%.

Who runs WH Smith now?

Leo Quinn has led the group as executive chair since April 2026. City AM reports he previously led turnarounds at Balfour Beatty and Qinetiq. He has described the current programme as a “fundamental reset” of the business.

Is WH Smith paying a dividend?

No. The board has not declared an interim or final dividend for the year to August 2026, and the company says it will review capital returns in the medium term, taking account of its balance sheet and investment needs.

What is the FCA investigating at WH Smith?

The Financial Conduct Authority is investigating whether WH Smith complied with UK listing rules and disclosure and transparency rules in relation to matters it announced on 19 November 2025, connected with an accounting error in its North American division. The company says it is cooperating fully.

When is WH Smith’s next trading update?

The next trading update, giving group revenue for the Christmas period, is due on 26 January 2027. Interim results for the six months to 28 February 2027 follow in April 2027, as the company moves its year-end to 31 December.

Are my rights different when I buy from a WH Smith shop at an airport or station?

No. The Consumer Rights Act 2015 applies in the same way, so faulty goods can be rejected within 30 days for a full refund. Refunds for a change of mind depend on the shop’s own policy, so keep your receipt, particularly if you are travelling.