Despite a “difficult” year end rocked by a major accounting scandal, WH Smith is “well positioned” for growth at the end of 2025, its interim CEO has insisted.
“Acutely aware” of the need to rebuild confidence in the travel retailer, the board is “acting at pace progressing [WH Smith’s] remediation plan,” and is “committed” to strengthening financial controls and governance, said interim CEO Andrew Harrison in a message to investors alongside the company’s preliminary full-year results.
The scandal – which knocked the company’s share price 42% in a single day – has dominated coverage of the retailer since August, when it was revealed WH Smith faced a black hole of up to £50m in its traidng profits.
CEO Carl Cowling resigned in November 2025, as further investigations revealed the accounting errors were more serious than previously thought.
WH Smith has revealed it is now preparing to claw back bonuses from former leaders, and is facing an official investigation from the Financial Conduct Authority.
The company’s final results revealed group profits before tax and non-underlying items came to £108m – down slightly further on the company’s first post-scandal estimate of £110m – as a £23m blow to headline profit from the accounting blunder, a further multi-million pound stock obsolescence problem and “small number of one-off items” revealed through subsequent investigations knocked £40m off the NA division’s profits.
Thanks to the blow to WH Smith’s hitherto high-performing NA division, the group’s headline trading profit fell 6.5% to £159m.
However, Harrison insisted that the company was in a strong position following its transition to pure-play travel retail earlier in the year with the sale of high street business and Funky Pigeon custom greetings card business.
“Travel retail is a high growth market, and we have attractive market positions in the UK, North America and our international markets from which we are well-positioned to grow,” he said.
Harrison’s confidence was backed by 5% like-for-like global growth at the retailer to £1.5bn, with its UK business – its largest market – also seeing increased trading profit of £131m, up from £126m.
Food-to-go has been a strong growth area for the retailer as it pursues its travel-only strategy.
“Our Smiths Family Kitchen offer has gone from strength to strength with award-winning products, an expanded meal deal proposition and an enhanced hot food and coffee range that is resonating strongly with customers,” the company said.
“In health and beauty, we have delivered strong growth, up 20% year-on-year, as we scale this category across our estate.”
Despite its accounting issues, the NA division’s largest business, Travel Essentials, has had a strong year with 19% growth. Now making up over half of the company’s revenue compared to a third in 2022, it is expected to make up over two-thirds of the group’s NA revenues in the medium term.
The company’s Rest of World division performed particularly well, with 12% revenue growth overall including 7% of like-for-like growth.
”This has been a year of strategic progress and challenge,” said the retailer in its report to investors.
”The Group has completed a significant strategic shift by completing the sale of our High Street business and online business, funkypigeon.com, fully aligning with our strategic focus to operate as a pure-play travel retailer.
”This transformation strengthens our platform for growth enabling us to capitalise on the significant potential of the global travel sector. We have a clear leadership position in Travel Essentials. Our stores are located in attractive, high footfall locations across the globe, and we have a dedicated team of passionate and customer-focused colleagues.”
WH Smith will have plenty of capital to play with to continue its transformation, including the best part of a £400m revolving credit facility, £340 in loans arranged in March 2025 but not yet drawn, and £200m in an extendable 12-month loan.
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