WH Smith: Investors to hear about strategy after sale of high street stores

Chief executive Carl Cowling said the sale was linked to its “strategic ambition to become the leading global travel retailer”. In recent years, the firm’s travel division – which also includes shops in hospitals – has grown to make up the bulk of its sales and profits, expanding to more than 1,200 stores across 32 countries.

Shareholders will be keen for more guidance on what the sale and the increased focus on travel means for its longer-term outlook. Despite the significant deal, shares in the business dropped to their lowest level since 2020 earlier this month. The company is among retailers with exposure to the US market which have seen their value knocked by President Donald Trump’s US tariff plans.

Analysts at Investec highlight that around 28 per cent of its sales and 30 per cent of its profits for the current financial year are expected to come from the US, which also includes Marshall Retail Group (MRG) and InMotion stores.

Investec suggests the company may see more of an impact from a “macro-economic slowdown rather than a tariff impact”, as weaker growth may affect traveller numbers.

Nevertheless, the brokerage said it expects any impact on the cost to its own-label products to “be passed on in higher prices”.

Shareholders will be keen for the company to shed light on how the tariffs are expected to impact on its pricing and profitability over the next year. WH Smith is also likely to reveal how it can mitigate any cost pressures caused by the change in policy.

The company is expected to report a headline pre-tax profit of £43m for the past six months, which would be down slightly against the same period last year, following weaker profitability from the high street arm. WH Smith is expected to see profits improve in the second half of the year amid a seasonal boost from an increase in travellers using its airport shops.

The group can trace its roots back to the 1790s, when Henry Walton Smith and his wife Anna established a news vending business in Mayfair. After their deaths, the business was taken over by youngest son William Henry Smith in 1812. He then renamed the business as WH Smith & Son in 1846 when his son, also called William Henry, joined him as a partner in the business. It took advantage of the UK railway boom by opening its first railway news stand at Euston Station in 1848. The company came under pressure in the 2000s and onwards as online retailers and supermarkets tapped into the high street business’s core customer base.