WH Smith has reported a sharp decline in annual profits despite revenue increasing 5 per cent to £1.63bn, as the travel retailer continues to tackle operational challenges and restructure its international business.

For the year ended 31 August 2026, headline profit before tax and exceptional items fell 30 per cent to £76m, compared with £108m the previous year.

The retailer also reported a statutory loss before tax of £107m, compared with a £2m profit in 2025, following £164m in non-underlying charges. These included around £103m in impairment costs, primarily relating to its North American operations.

Like-for-like sales across the group increased 2 per cent, while free cash flow fell to £52m from £63m.

The results come as WH Smith undertakes a strategic reset following a turbulent year marked by profit warnings, an accounting error and changes to its leadership.

Executive chairman Leo Quinn has been tasked with restoring financial discipline and simplifying the business, with a renewed focus on profitable growth and returns on investment.

The group has been reviewing its international portfolio, scaling back underperforming operations and concentrating investment on its core travel retail markets.

In September, WH Smith warned that annual profits would come in at the lower end of its previous forecast, citing weaker travel demand, inflationary pressures and increased promotional activity.

Looking ahead, the retailer expects headline profit before tax and non-underlying items of between £75m and £85m for its 2027 financial year. Net debt is forecast to stand at around £320m.

WH Smith said its priorities include strengthening operational foundations, improving governance and controls, and maintaining a tighter approach to capital allocation as it works to rebuild investor confidence.

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