From Dailymail · · 1m 20s
WH Smith hits 17-year low as war and costs bite
The travel retailer slashed profit forecasts twice in two months as Middle East conflict and inflation squeeze margins.
In brief
The travel retailer slashed profit forecasts twice in two months as Middle East conflict and inflation squeeze margins. WH Smith's pivot to focus on travel retail backfired when geopolitical disruption and rising costs forced multiple profit downgrades. Originally reported by Dailymail.
WH Smith shares hit 17-year low
Shares fell 1.6 percent to 357 pence, their lowest level since 2009, after the retailer posted a downbeat trading update.
“Shares fell 1.6 per cent to 357p, their lowest level since 2009.”
Profits plunge from £108m to £75m
WH Smith now expects pre-tax profits of £75 million, down sharply from £108 million in underlying profits for 2024-25.
Iran war disrupts travel retail
Middle East conflict has hit the travel sector hard, forcing WH Smith to cut profit forecasts twice in two months.
“War across the Middle East has hit the travel sector”
Rising costs force deeper discounts
Inflation and higher operating costs forced WH Smith to increase promotions, which cost-cutting and lower interest rates could not fully offset.
Like-for-like sales down 3 percent
Fourth quarter like-for-like revenue fell 3 percent compared to a year ago, showing weak demand across the travel retail business.
“like-for-like revenue in its fourth quarter fell by 3 per cent”
Refocused strategy backfires
WH Smith sold its UK high street business last year to focus on travel retail, but the pivot coincided with Middle East conflict and inflation.
The bottom line
WH Smith's pivot to focus on travel retail backfired when geopolitical disruption and rising costs forced multiple profit downgrades.
