REG - WH Smith PLC - Interim Results Announcement
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RNS Number : 5668B WH Smith PLC 23 April 2026
23 April 2026
WH SMITH PLC
INTERIM RESULTS ANNOUNCEMENT
FOR THE PERIOD ENDED 28 FEBRUARY 2026
Solid first half trading performance; cautious outlook ahead of peak summer
trading period
· Total Group revenue up 5% to £748m (2025(1): £716m)
o UK up 2%; North America (NA) up 10%*; Rest of the World and Other ('ROW')
up 8%*
· Headline Group profit before tax and non-underlying items(2) £3m
(2025(1): £21m)
o Headline Group trading profit(2) of £32m (2025(1): £47m)
· Headline diluted EPS before non-underlying items(2) (0.8)p (2025(1):
11.5p)
· Good progress against the key priorities set out in December across
all divisions
· UK trading performance in H1 impacted, as expected, by disruption
following the refurbishment of multiple large airport stores and inflation
headwinds
· Successfully opened global flagship stores at Heathrow Terminals 3, 4
and 5 in March and April
· Travel Essentials stores in North America delivering a strong
performance with total revenue up 22%* in H1; decisive actions taken in the
Resorts business; good progress made against remediation plan
· Continued progress in core ROW markets with actions to address
challenging performance and reduce exposure in sub-scale markets
· Suspension of the dividend to reduce debt and strengthen the Group's
financial position
· In light of the uncertainty arising from the conflict in the Middle
East, the Group is taking a more cautious outlook reflecting the impact on
passenger numbers and weaker consumer confidence. At this stage, the Group
expects to deliver FY26 Headline Group profit before tax and non-underlying
items(2) of £90m - £105m.
Leo Quinn, Executive Chair, commented:
"The immediate focus is to restore confidence and ensure the right foundations
are in place to support profitable growth and long‑term value creation.
"Moving forward, the Board and management team will have a relentless focus on
driving cash, cost discipline and strengthening the balance sheet. As a first
step, the Board has taken the prudent decision to suspend the dividend.
"This is a business with a strong brand and proposition in high‑footfall
travel markets and the new flagship stores opened across Heathrow airport are
raising the global standard for travel essentials retail.
"None of this is achievable without our people. Making sure our colleagues are
empowered is a key priority, as engaged teams execute better, serve customers
better and drive higher performance over time.
"While the near-term outlook is uncertain, I am confident that, with the right
focus and discipline, the business can deliver superior returns for the
benefit of our colleagues, partners and shareholders over the longer-term."
* On a constant currency basis
(1) Comparative periods have been restated to correct the accelerated supplier
income recognition and inventory-related items in the North America division
(refer to Note 1b for further details) and to separately disclose results from
discontinued operations (refer to Note 1a for further details)
(2) Alternative Performance Measure (APM) defined and explained in the
Glossary on page 48. All numbers presented are from continuing operations
unless otherwise stated
Group financial summary - continuing operations
£m unless indicated otherwise IFRS 16 Headline
Trading profit(2) pre-IFRS 16(3)
Feb 2026 Feb 2025 Feb 2026 Feb 2025
Restated(1) Restated(1)
UK 38 40 34 40
North America 9 8 2 5
Rest of the World and Other ('ROW') (5) 5 (4) 2
Group trading profit(2) 42 53 32 47
Group profit before tax and non-underlying items(2) 2 17 3 21
Diluted (loss)/earnings per share before non-underlying items(2) (1.6)p 8.5p (0.8)p 11.5p
Non-underlying items(2) (27) (21) (28) (20)
Group profit before tax (25) (4) (25) 1
Basic and diluted loss per share (20.0)p (5.5)p (20.0)p (1.6)p
Revenue performance - continuing operations
£m Total Revenue Half Year 2026 Total Revenue Total Revenue Constant currency LFL LFL
Half % change Half Year 2026 Half Year 2026 7 weeks to 18 April 2026
Year % change(4) % change % change
2025
Restated(1)
UK 392 384 2% 2% 2% 0%
North America 204 194 5% 10% 1% 2%
Rest of the World and Other 152 138 10% 8% 6% 5%
Group 748 716 5% 5% 2% 2%
Current trading
In the first 7 weeks of trading for H2 2026, Group like for like ('LFL')
revenue(2) was up 2%. By division, the UK delivered flat LFL revenue growth,
largely reflecting a softening in Air following disruption to flight schedules
to the Middle East. In North America, LFL revenue growth was 2% with the core
Travel Essentials business continuing to perform well with LFL revenue growth
of 6%. Rest of the World delivered LFL revenue growth of 5%.
Outlook and planning assumptions
In light of the uncertainty arising from the conflict in the Middle East, the
Group is taking a more cautious outlook reflecting the impact on passenger
numbers and weaker consumer confidence. Much will depend on the peak summer
trading period and the Group assumes no immediate improvement in consumer
confidence and assumes that jet fuel supplies can be maintained. At this
stage, the Group expects to deliver FY26 Headline Group profit before tax and
non-underlying items(2) of £90m - £105m.
(3) The Group adopted IFRS 16 'Leases' with effect from 1 September 2019. The
Group continues to monitor performance and allocate resources based on
pre-IFRS 16 information (applying the principles of IAS 17), and therefore the
results for the years ended 31 August 2025 and 31 August 2024 have been
presented on both an IFRS 16 and a pre-IFRS 16 basis. Measures described as
'Headline' are presented pre-IFRS 16. For the purposes of narrative commentary
on the Group's performance and financial position, both pre-IFRS 16 and IFRS
16 measures are provided. Reconciliations from pre-IFRS 16 measures to IFRS 16
measures are provided in the Glossary on page 48. Group revenue was not
affected by the adoption of IFRS 16, and therefore all references to and
discussion of revenue are based on statutory measures.
(4) Constant currency
Planning assumptions for the full year ending 31 August 2026: total Group
revenue growth of c.3%-5%. In the UK, total revenue growth of c.1%-3%, in
North America c.6%-8%, and in the Rest of the World division, c.2%-4%.
Headline trading profit margin(2) in the UK of c.13%-14%, North America c.7%,
and c.4% in the Rest of the World. This reflects the expected reduction in
brand marketing, increased promotional activity and inflation headwinds.
Full year headline net debt(2) is expected to be around £420m.
ENQUIRIES:
WH Smith PLC
Nicola Hillman Media Relations 01793 563354
Mark Boyle Investor Relations 07879 897687
Brunswick
Tim Danaher 020 7404 5959
WH Smith PLC's Interim Results 2026 are available at whsmithplc.co.uk
(http://www.whsmithplc.co.uk) .
GROUP OVERVIEW
The Group has delivered a solid first half trading performance against a
backdrop of investment related disruption and inflation headwinds.
The UK business is focused on retaining category leadership in Travel
Essentials through the one-stop-shop format. Good progress has been made, with
refurbished stores opening under this format across Heathrow Terminals 3, 4
and 5, Liverpool, Belfast and East Midlands airports. Within the UK, the focus
also remains on expanding the Travel Essentials proposition by targeting new
and better quality space. Growth categories of health and beauty, including
the recently launched own-brand 'Roame' range, and expanding food-to-go remain
a priority.
In North America, the core Travel Essentials business continues to perform
well with this segment being the focus for investment and profitable growth
going forward. The Resorts and InMotion businesses continue to perform below
expectations. Following a review of the Resorts business in the first half, 3
unprofitable fashion stores have closed and the business is on track to exit
additional unprofitable fashion and speciality stores by the end of the
current financial year. The InMotion business, including the breadth of the
portfolio of stores, is under active review and future store openings under
this brand will only be considered as part of strategically important tender
packages.
In the ROW division, future investments will be focused in strategically
important markets where the business already has scale, including Ireland,
Spain and Australia. In the first half, new investments were agreed in the
Republic of Ireland, including key units at Dublin airport. Moving forward,
the focus will be to reduce the Group's presence in or exit sub-scale markets.
Consistent with this approach, 4 uneconomic stores were closed at Dusseldorf
airport in the period and the Group's Norwegian business has been closed.
Future growth opportunities will only be considered using a less
capital-intensive franchise model.
The Group's remediation plan implemented following the issues identified in
the North America division, to strengthen governance, controls and systems and
globally aligned processes is progressing well.
The Group continues to cooperate with the FCA following an investigation into
the Company in respect of its compliance with UK Listing Principles and Rules
and the Disclosure and Transparency Rules in relation to the matters announced
by the Company on 19 November 2025. The Group is committed to cooperating
fully with any engagement in relation to the North America accounting issue
from any regulatory body or other authority.
On 7 April 2026, Leo Quinn joined the WHSmith Group as Executive Chair.
Looking ahead, the immediate focus for the Group is to drive cash, improve
efficiency, reduce debt, and restore the business to profitable growth.
Group revenue - continuing operations
6 months to 28 February 2026
Total Total constant currency(4) LFL(2)
vs 2025 vs 2025 vs 2025
UK 2% 2% 2%
North America 5% 10% 1%
Rest of the World and Other 10% 8% 6%
Group 5% 5% 2%
Total Group revenue at £748m (2025(1): £716m) increased by 5%, with LFL(2)
revenue up 2%, compared to the prior year. By division, the UK was up 2% on a
total basis, North America was up 10%(4), and ROW was up 8%(4). On a LFL
basis, the UK was up 2%, North America was up 1%, and ROW was up 6%.
Headline Group trading profit
The Group delivered a Headline trading profit(2) in the period of £32m
(2025(1): £47m). The UK decreased by £6m to £34m; North America decreased
by £3m to £2m; and ROW decreased by £6m to a loss of £4m.
Headline Group profit before tax and non-underlying items(2) was down £18m to
£3m (2025(1): £21m). Group loss before tax, including non-underlying items
and on an IFRS 16 basis, was £25m (2025(1): £4m) in the period.
Group balance sheet
The Group maintains a solid balance sheet with cash generative trading
operations and good liquidity. The Group had the following cash and committed
facilities as at 28 February 2026:
£m 28 February 2026 Maturity
Cash and cash equivalents(5) 48
Revolving Credit Facility(6) 400 June 2030
Convertible bonds 327 May 2026
US Private Placement notes 200 2032-2038
Term loan 120 March 2029
The Group has a revolving credit facility ('RCF') with a maturity date of 30
June 2030 and a £327m convertible bond with a maturity of 7 May 2026 which
has a fixed coupon of 1.625%.
As at 28 February 2026, Headline net debt(2) was £496m (August 2025: £390m)
and the Group has access to c.£550m of liquidity. Leverage(2) at 28 February
2026 was 2.9x Headline EBITDA(2) (August 2025(1): 2.1x). Net debt including
IFRS 16 lease liabilities at 28 February 2026 was £1,010m (August 2025:
£874m).
The Group's refinancing, as previously announced, extends and smooths the
maturity profile of its debts. In March 2026, the US private placement notes
were fully drawn down and the Group cancelled its 12-month £200m term loan
facility. Additionally, the Group exercised the first of two one-year
extension options on the £120m term loan taking its maturity to March 2029.
The term loan is expected to be drawn down ahead of repayment of the
convertible bonds in May 2026.
Group cash flow
The Group generated a Headline EBITDA(2) of £48m in the period (2025(1):
£62m). Capex was £50m (2025: £38m(7)). As expected, working capital outflow
was £54m(8) in the period (2025(1,8): outflow of £72m), which results from a
one-off payables timing headwind linked to one of our large franchisor
partners at the end of last year, new store openings, and the seasonality of
the business.
( )
(5) Cash and cash equivalents comprises cash in bank and on deposit of £33m
and cash in transit of £15m
(6) Draw down of £219m as at 28 February 2026
(7) Excluding capex related to non-underlying items of £nil (2025: £1m)
(8) Pre-IFRS 16 and before non-underlying items
In total, there was a free cash outflow(2) in the period of £61m (2025(1):
£72m). This year, it is expected that, subject to investment opportunities,
Headline net debt(2) will be in the region of £420m at the end of the
financial year.
Capital allocation
The Group remains focused on maintaining an efficient balance sheet and on a
disciplined approach to capital allocation. In the near-term, the Group has
rebalanced its capital allocation priorities to:
· strengthen the balance sheet through tighter cash control and
improved cash generation;
· invest to grow and protect value. This will be achieved by investing
in business development and new space growth with a clear focus on attractive
returns. Furthermore, business assets will be protected through maintenance
and transformation projects. It is anticipated that capex spend will be
c.£90m in the current financial year; and
· the dividend has been suspended to support the strengthening of the
balance sheet and the Group will look to reinstate returns to shareholders
when excess cash is available.
CONTINUING OPERATIONS
Total revenue for the Group was £748m (2025(1): £716m), an increase of 5%
compared to the previous year, generating a Headline trading profit(2) in the
period of £32m (2025(1): £47m).
£m Trading profit(2) Headline trading profit(2)
(IFRS 16) (pre-IFRS 16) Revenue
Feb 2026 Feb 2025 Feb 2026 Feb 2025 Feb 2026 Feb 2025
Restated(1) Restated(1) Restated(1)
UK 38 40 34 40 392 384
North America 9 8 2 5 204 194
Rest of the World and Other (5) 5 (4) 2 152 138
Total 42 53 32 47 748 716
UK
In the UK, total revenue in the first half was £392m (2025: £384m) which
resulted in a Headline trading profit(2) of £34m (2025: £40m). This
reduction year on year reflects the inflationary pressures on the business and
the expected disruption caused as a result of the store refurbishments across
several airport locations in the period.
Within this division, a key area of focus is to develop ranges and formats
that are relevant to the customer at each stage of their journey enabling them
to make best use of their time when travelling and put more products into
their baskets to grow spend per passenger.
In food-to-go, the Smith's Family Kitchen offer is going 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 health and beauty category is delivering strong growth and, during the
first half, the business launched its first own-brand health and beauty
product range under the brand 'Roame'.
These extended ranges enable the business to continue to innovate through
format development, ensuring that the one-stop-shop proposition is credible to
customers and landlords while creating further space growth opportunities.
Optimising the estate and reviewing the division's operating model has also
been a key area of focus in order to realise substantial cost efficiencies in
the face of inflationary cost pressures. This will continue into the second
half of the financial year.
During the period, 7 new stores were opened, including 4 at airports, 1
Hospital store, 1 Rail store and 1 motorway service area franchise. 11 small
and less well-located stores were closed.
Revenue growth by key channels
Revenue (% change)
6 months to 28 February 2026
Total LFL(2)
vs 2025 vs 2025
Air 1% 2%
Hospitals 8% 4%
Rail 1% (2)%
Total UK 2% 2%
Air
Total revenue increased by 1%, with LFL revenue up 2%, reflecting the expected
trading disruption resulting from the division's largest ever store
development programme. In the first 7 weeks of trading in the second half, LFL
revenue was down 3%. This reflects the trading disruption from the store
refurbishments, the impact on passenger numbers as a result of the conflict in
the Middle East and inflation headwinds.
Since the beginning of the financial year, 6 one‑stop‑shops have opened
ahead of the summer, including refurbished stores at Heathrow, Liverpool,
Belfast and East Midlands airports. These new format stores will broaden the
offer for customers and improve convenience and basket size in these
high‑footfall locations.
Health and beauty and food-to-go remain attractive growth categories and they
are well aligned to passenger needs.
Over the past 4 weeks, 3 flagship stores have opened across Heathrow Terminals
3, 4 and 5. Each of these locations showcase the full breadth of the Travel
Essentials proposition, including a full health and beauty offer and instore
pharmacies. These latest store openings are setting a new global benchmark for
Travel Essentials with improved design, in store navigation and extensive
ranges. While it is early days, their performance is encouraging.
Heathrow Terminal 3 is the division's highest density store with c.6,500
transactions per day. This 5,500 sq ft store showcases the best of the
one-stop-shop format with a full health and beauty offer, including an instore
pharmacy, alongside a Smith's Family Kitchen food-to-go range and a new coffee
and breakfast offer. These categories continue to drive good growth
demonstrating the vast choice available to customers and customer demand.
At Heathrow Terminal 5, a larger 6,500 sq ft refurbished store opened at the
beginning of April encompassing the full one-stop-shop offer with an adjoined
InMotion store. The reduced InMotion footprint has enabled greater investment
into higher growth and higher margin categories, including health and beauty
and food-to-go. Within the InMotion store, customers can browse a full Apple
shop-in-shop alongside headphones and tech accessories from other major global
brands.
During the period, 4 new stores were opened at Manchester airport and 9 stores
were closed, primarily as a result of landlord redevelopment.
Hospitals
Hospitals is the UK division's second largest channel by revenue and it
delivered a strong performance in the period, with revenue increasing by 8%
and LFL revenue up 4%. In the first 7 weeks of trading in the second half, LFL
revenue increased by 3%. This growth reflects the strength of the multi-format
approach and the strong partnerships in place.
During the period, 1 new hospital store was opened. The division currently
operates from 155 stores in over 100 hospitals, and there are still
significant space growth opportunities in this channel.
Rail
Total revenue in Rail increased by 1% year on year with LFL revenue down 2%.
In the first 7 weeks of trading in the second half, LFL revenue decreased by
1%. During the period, 1 new store opened at London Bridge station featuring
the one-stop-shop format. In addition, a key area of focus in this channel is
on broadening more food and beverage on-the-go ranges in order to maximise
customer convenience. There is the opportunity to expand this further across
more stores in Rail. 1 store was closed in the period.
NORTH AMERICA
Despite the challenges at the start of the financial year, North America is an
attractive market and investment opportunity. This is the largest travel
retail market in the world with significant investment and long-term
structural growth trends. There is therefore plenty of opportunity to
capitalise on the substantial growth opportunities given the division's small
market share.
Total revenue in North America in the period increased by 10%(4), on a
constant currency basis, with total revenue up 5% to £204m (2025: £194m).
The Air segment in North America was up 15% on a constant currency basis and
LFL revenue increased by 3%. Within this, the Travel Essentials business,
which accounts for over 55% of revenue in North America, was the key driver of
performance, with total revenue on a constant currency basis up 22% and up 6%
on a LFL basis.
This division delivered a Headline trading profit(2) of £2m (2025(1): £5m),
with the reduction year on year largely driven by increased costs associated
with the new logistics set up and the annualisation of increases in labour
costs. The prior half year has been restated for the supplier income and
inventory‑related items identified at FY25.
During the first half, 18 new stores were opened across airports including
Dallas Fort Worth, Denver, Detroit and Albuquerque.
Travel Essentials
The Travel Essentials business has consistently delivered a strong
performance, growing 19% on a constant currency basis in FY25 and up 22% in
the first half, underpinned by customer demand and attractive double-digit
margins.
Travel Essentials is the division's most profitable segment and on a fully
allocated basis generates around a 10% Headline trading profit margin(2). It
is anticipated that as the business grows and operations are enhanced, margins
will grow further, which in turn, will support the profitability of the North
America division overall.
In January, the team opened a new store at Albuquerque airport featuring a
marketplace format. This is a good example of where it is possible to
introduce the convenience of everything under one roof, similar to the Group's
one-stop-shop format in the UK. Under this contract, there is the flexibility
to realign category mix over the term of the lease to ensure the proposition
remains relevant for customers and ahead of changing trends. The payback
period is less than two years and a long-term contract has been secured.
In Portland, the new East Bank Market store opened during the period which is
performing ahead of expectations. This store has a payback period of less than
two years. Both these examples demonstrate that the Group has a clear ability
to win in prime locations, adapt formats and drive attractive and profitable
returns.
The division's new store pipeline is strong and following a review, these new
stores will meet the Group's investment hurdle rates. We expect a good tender
pipeline of new stores in the second half of the year.
InMotion
InMotion LFL revenue decreased by 4% in the first half of the year. In the
first 7 weeks of trading, LFL revenue is up 3% as a result of increased store
footfall in the period.
InMotion is highly regarded by landlords. However, this segment is in
like-for-like decline and it is now essential that the focus turns to the
commercial proposition, reducing the number of product lines and improving
availability while reducing working capital.
In the first half of the year, 9 stores were closed with 6 new store openings
across Dallas, Denver, Detroit and Albuquerque airports, primarily as part of
wider retail packages within these airports. Moving forward, new store
openings will be limited, with any new InMotion stores being considered only
as part of strategically important tender packages with strong returns.
The review of the existing store portfolio is ongoing and is expected to
complete in the second half of the year. This review includes undertaking a
deeper diagnostic of the estate to determine the factors that need to be in
place for these stores to succeed.
Over time, the number of InMotion stores will decline by around 20%-30%, with
store numbers reducing below 100 in the medium-term.
Despite store closures, there is an opportunity to increase the margin over
time with the best performing stores retained, range optimisation complete and
a strengthened operational performance.
Resorts
LFL revenue in Resorts decreased by 6% in the period, driven by the continued
reduction in Las Vegas visitor numbers. This trend has continued in the first
7 weeks of the second half with Resorts down 8%.
As announced at the Group's Preliminary Results in December 2025, there is no
plan to open any new stores in Resorts. Decisive action has been taken to
begin a controlled exit of the fashion stores and to reduce the number of
speciality stores.
In the first half of the year, 8 Resort stores were closed: 3 fashion and 5
speciality where the leases were short or there were opportunities to exit
without penalty. An additional 8 Fashion stores will be closed in the balance
of year. There are a further 4 fashion stores where discussions are ongoing
with landlords to look to reformat these stores and 10 stores where
discussions are ongoing with third parties. We aim to largely complete the
exit of the fashion stores this year.
Other format options or controlled exit options for the remaining speciality
stores, where the lease arrangements run over the medium term, are under
review.
The Hotel Convenience and Welcome to Las Vegas stores are profitable and cash
generative and these will continue to be optimised.
Revenue growth by key channels
Revenue (% change)
6 months to 28 February 2026
Total Total at constant currency(4) vs 2025 LFL(2)
vs 2025 vs 2025
Air 9% 15% 3%
Resorts (11)% (6)% (6)%
Total North America 5% 10% 1%
During the period, 18 new stores were opened and 18 stores were closed.
There are over 50 stores which have been won and are yet to open.
Including the 18 store openings in the period, the North America division now
operates from 282 stores in Air (including 120 InMotion stores), and 80 stores
across Resorts and Rail.
Strengthening the operating model has been a key area of focus in the period
and the Group's remediation plan has progressed. Global accounting policies
are being implemented across all divisions with associated operational systems
and controls. Key financial reporting controls have been embedded into the
North America month end processes and commercial finance capabilities have
been strengthened.
REST OF THE WORLD AND OTHER
The Rest of the World division delivered total revenue growth of 8% on a
constant currency basis with LFL revenue up 6%. The division delivered a
Headline trading loss(2) of £4m (2025: Headline trading profit of £2m). This
reflects a challenging performance in some locations and the inflationary
pressures on staff and logistics costs. These locations are part of the
current divisional review.
Further investment will be targeted where the business already has scale and
expertise, ensuring profitability is strengthened in the largest-serving
markets, with a particular focus in Ireland, Spain and Australia.
During the first half, new investments were agreed in the Republic of Ireland
which is an important market for the division. This will also see the
introduction of the successful one-stop-shop format into Dublin, Cork and
Shannon airports. New stores were also opened at Melbourne and Tenerife
airports.
Managing the division's store portfolio is also a key priority which will
result in exiting and reducing exposure for the Group in sub-scale markets as
contracts expire or through active portfolio management. During the first
half, 4 uneconomic stores were closed at Dusseldorf airport, and, more
recently, the Group has exited its uneconomic Norwegian business. The Group
continues to explore the potential to withdraw from other uneconomic markets
while also assessing the possibility to move to a franchise model in some
locations.
Looking ahead to the next phase of growth, the Group will focus on a less
capital intensive franchise-led model, an area where there is already
considerable experience. This approach will enable expansion across
high-potential markets where there is an opportunity to extend the Group's
presence.
Consistent with the less capital-intensive franchise led model, during the
first half we opened a further franchise store in the Philippines, and 2
further stores opened at the start of H2 in Saudi Arabia. An additional 5
stores were opened in Malaysia under a joint venture agreement. By working in
partnership with experienced local operators, it is possible to leverage their
local expertise alongside the Group's space and promotional management to
optimise performance.
The ROW division now has 324 stores open. Of these, 58% are directly-run, 11%
are joint venture and 31% are franchise.
CultPens.com delivered a good performance in the period, in line with the
Group's expectations.
Technical planning assumptions FY26 (Pre IFRS 16 basis)
Central costs £30-£32m
Interest charges £33-£35m
Effective tax rate(2) c.25%
Non-underlying(2) c.£50m
Capex c.£90m
Headline net debt(2) c.£420m
Total stores
6 months ended 28 February 2026
No. of stores UK North America ROW Total
At 31 August 2025 593 362 325 1,280
Opened 7 18 11 36
Closed (11) (18) (12) (41)
Net (closures)/openings (4) - (1) (5)
At 28 February 2026 589 362 324 1,275
Closures:
Relocations / loss-makers (6) (5) - (11)
Landlord redevelopment (5) (1) (1) (7)
Lease expiries - (12) (11) (23)
(11) (18) (12) (41)
During the period, 36 stores were opened. As at 28 February 2026, the Group
operated from 1,275 stores (2025: 1,280). 41 stores were closed in the period.
The Group's focus will remain on opening more profitable stores and better
quality space. In the current financial year, it is anticipated that a further
c.30-40 stores will close with c.10-20 new store openings.
ENVIRONMENTAL AND SOCIAL GOVERNANCE ('ESG')
The Group continues to make solid progress against its main sustainability
commitments and it is on track to meet its current net zero targets to reduce
Scope 1 and 2 emissions by 80% by 2030 and have 75% of supply chain emissions
covered by science-based carbon reduction targets by 2027.
Work on packaging reduction and the transition to more recyclable options
continues, aligned to producer responsibility legislation in all UK and
European markets.
Our colleague networks continue to grow, providing a channel for colleague-led
engagement on our diversity and inclusion initiatives and employee policies
and processes.
Our charity partnership with the National Literacy Trust continues to support
children's literacy and Miracle Flights supports children who need to travel
to receive life-changing medical care.
WHSmith is the top performing speciality retailer in Morningstar's
Sustainalytics ESG Benchmark and has been awarded an ESG rating of AAA from
MSCI.
FINANCIAL REVIEW
IFRS Headline
pre-IFRS 16(2)
£m Feb 2026 Feb 2025 Feb 2026 Feb 2025
Restated(1) Restated(1)
Trading profit(2)
UK 38 40 34 40
North America 9 8 2 5
Rest of the World and Other (5) 5 (4) 2
Group trading profit - continuing operations(2) 42 53 32 47
Unallocated central costs (15) (14) (15) (14)
Group operating profit before non-underlying items - continuing operations(2) 27 39 17 33
Net finance costs (25) (22) (14) (12)
Group profit before tax and non-underlying items - continuing operations(2) 2 17 3 21
Non-underlying items(2) (27) (21) (28) (20)
Group profit before tax - continuing operations(2) (25) (4) (25) 1
Income tax charge 4 (1) 4 (1)
Loss for the year - continuing operations (21) (5) (21) -
Loss for the year - discontinued operations (2) (42) (2) (35)
Loss for the year - total operations (23) (47) (23) (35)
Attributable to:
Equity holders of the parent (27) (49) (27) (37)
Non-controlling interests 4 2 4 2
(23) (47) (23) (35)
Total Headline trading profit(2) in the period was £32m (2025(1): £47m) of
which the largest division, UK, generated a Headline trading profit(2) of
£34m (2025: £40m). North America delivered £2m (2025(1): £5m) and ROW a
Headline trading loss(2) of £4m (2025: Headline trading profit of £2m).
The Group generated a Headline profit before tax and non-underlying items(2)
of £3m (2025(1): £21m).
Net finance costs - Continuing operations
Headline
IFRS pre-IFRS 16(2)
£m Feb 2026 Feb 2025 Restated(1) Feb 2026 Feb 2025 Restated(1)
Interest payable on bank loans and overdrafts 7 5 7 5
Interest on convertible bonds 8 7 8 7
Interest income on joint venture loans (1) - (1) -
Interest on lease liabilities 11 10 - -
Net finance costs 25 22 14 12
Headline net finance costs (pre-IFRS 16) in the period were £14m (2025(1):
£12m). This includes cash outflows of £9m (2025: £7m) and £4m (2025: £4m)
relating to the non-cash debt accretion charge from the convertible bond which
has a fixed coupon of 1.625%.
Lease interest of £11m arises on lease liabilities recognised under IFRS 16,
bringing the total net finance costs on an IFRS 16 basis to £25m (2025(1):
£22m).
Tax
The effective tax rate(2) in the period was 16% (2025(1): 19%) on profit
before tax and non-underlying items(2). Net corporation tax receipts in the
period were £5m (2025: payments of £17m). Based on current legislation, it
is expected that the effective tax rate(2) in the current financial year will
be around 25%.
Earnings per share
Calculation of Headline diluted earnings per share - Continuing
operations(2)
Headline
pre-IFRS 16(2)
£m - Unless otherwise stated Feb 2026 Feb 2025
Restated(1)
Headline profit before tax(9) 3 21
Income tax expense(9) - (4)
Headline profit for the year(9) 3 17
Attributable to non-controlling interests (4) (2)
Headline profit for the year attributable to equity holders of WH Smith PLC(9) (1) 15
Weighted average shares in issue (diluted) (no. of shares - millions)(10) 126 130
Headline diluted EPS(2) (0.8)p 11.5p
The above measures are calculated on a pre-IFRS 16 basis.
Headline diluted EPS(2) was (0.8)p (2025(1): 11.5p).
EPS calculated on an IFRS 16 basis is provided in Note 7, and a reconciliation
between the IFRS 16 and pre-IFRS 16 earnings per share is provided in Note A4
to the Glossary on pages 54 to 55.
The diluted weighted average number of shares in issue used in the calculation
of Headline diluted EPS(2) assumes that the convertible bond is not dilutive
and reflects the number of shares held by the ESOP Trust.
Profit attributable to non-controlling interests primarily represents the
joint venture partner share of profit in relation to airport contracts in the
USA. For the six months ended 28 February 2026, the profit attributable to
non-controlling interests was £4m (2025(1): £2m) and is determined based on
operating financial performance of the associated stores prior to allocation
of administrative costs.
( )
(9) Before non-underlying items
(10) Where profit attributable to equity holders represents a loss, the basic
weighted average shares in issue are used in the diluted EPS calculation.
Refer to Note 7 for further details.
Non-underlying items(2)
The Group has chosen to present a measure of profit and earnings per share
that excludes certain items, which are considered non-underlying and
exceptional due to their size, nature or incidence, or are not considered to
be part of the normal operations of the Group. Non-underlying items in the
year in the Income statement are detailed in the table below.
IFRS Headline
pre-IFRS 16(2)
£m Ref. Feb 2026 Feb 2025 Restated(1) Feb 2026 Feb 2025 Restated(1)
Items included in the Income statement
Amortisation of acquired intangible assets (1) (1) (2) (1) (2)
Impairment of non-current assets (2) (16) (6) (11) (5)
Provisions for onerous contracts (2) - (1) (4) (1)
Transformation programmes - supply chain, IT and operational efficiencies (3) (6) (12) (6) (12)
Costs relating to the investigation into accelerated recognition of supplier (4) (3) - (3) -
income in North America
Impairment of other receivables (5) (2) - (2) -
IFRS 16 remeasurement gains 2 - - -
Other non-underlying costs (1) - (1) -
Total non-underlying items recognised in the income statement - continuing (27) (21) (28) (20)
operations
(1) Amortisation of acquired intangible assets
Non-cash amortisation of acquired intangible assets of £1m (2025: £2m)
primarily relate to the MRG and InMotion brands.
(2) Impairment of non-current assets and provision for onerous contracts
The Group has carried out an assessment for indicators of impairment of
non-current assets across the store portfolio.
Where an indicator of impairment has been identified, an impairment review has
been performed to compare the value-in-use of cash generating units, based on
management's assumptions regarding likely future trading performance, aligned
with the latest Board approved forecast, to the carrying value of the
cash-generating unit as at 28 February 2026.
As a result of this exercise, a non-cash charge of £11m (2025(1): £5m) was
recorded within non-underlying items for impairment of non-current assets on a
pre-IFRS 16 basis, of which £10m (2025(1): £5m) relates to property, plant
and equipment and £1m (2025(1): £nil) relates to intangible assets
(primarily software). On an IFRS 16 basis, the total impairment charge of
£16m (2025(1): £7m) comprises £11m property, plant and equipment (2025(1):
£5m), £1m intangible assets (2025(1): £nil) and £4m (2025(1): £1m)
right-of-use assets.
A charge of £4m on a pre-IFRS 16 basis (2025(1): £1m; IFRS 16 basis £nil;
2025(1): £1m) has been recognised in the income statement to provide for the
unavoidable costs of continuing to service a number of non-cancellable
supplier and property contracts where the space is vacant, a contract is
loss-making or currently not planned to be used for ongoing operations. This
provision will be utilised in line with the profile of the contracts to which
they relate.
Of the total charge for impairment and onerous contracts, on a pre-IFRS 16
basis, £1m is attributable to the UK operating division, £8m to North
America and £6m to Rest of the World and Other. Impairment charges in the
North America and Rest of the World and Other operating divisions have
principally arisen due to a lower trading outlook in certain individual stores
across these regions.
(3) Transformation programmes
Costs of £6m (2025: £12m) have been classified as non-underlying in relation
to a number of Board-approved programmes relating to IT transformation (£4m;
2025: £3m), operational efficiencies (£2m; 2025: £7m) and supply chain
(£nil; 2025: £2m).
The IT transformation programme includes costs relating to upgrading core IT
infrastructure, data migration and investment in data security, store systems
modernisation and other significant IT projects. These strategic projects will
provide additional stability, longevity and operational benefits. Costs in
FY26 are expected to be around £7m and approximately £5m in FY27 before the
current programme completes.
The operational efficiencies programme commenced in 2025 and costs include
head office restructuring and transformation costs across all segments. This
programme will deliver a more efficient operating model to support the Group's
strategic objectives. The current programme will largely complete in FY26 and
we would expect the remaining cost for these items to be around £3-4m in the
remainder of the financial year.
These multi-year programmes are reported as non-underlying items on the basis
that they are significant in quantum, relate to a Board-approved programme and
to aid comparability from one period to the next.
(4) Costs associated with the investigation into accelerated recognition of
supplier income in North America
Costs incurred during the period include £3m of professional fees in relation
to the investigation into accelerated recognition of supplier income in North
America including costs of the investigation, remediation and regulatory
related costs. We expect further costs in FY26 in the region of £3-4m.
(5) Impairment of other receivables
The Group's other receivables include amounts due from non-controlling
interest equity shareholders in certain of the Group's North America
subsidiaries which relate to contributions owed towards property, plant and
equipment construction for stores and are received in accordance with the cash
requirements of the subsidiary. Certain of these contributions are no longer
considered to be recoverable based on the expected credit loss that considers
the counterparty's ability to pay, which reflects the financial outlook of the
associated stores. Such expected credit losses of £2m (2025: £nil) are
recognised within non-underlying items where an impairment charge for store
non-current assets has also been recognised within non-underlying items.
A tax credit of £4m (2025(1): £3m) has been recognised in relation to the
above items (£4m pre-IFRS 16 (2025(1): £3m)) from continuing operations.
Cash flow
Free cash flow(2) reconciliation - Continuing operations
pre-IFRS 16(2)
£m Feb 2026 Feb 2025(1)
Headline Group operating profit before non-underlying items(2) 17 33
Depreciation, amortisation and impairment (pre-IFRS 16)(11) 27 25
Non-cash items 4 4
Headline EBITDA(2, 11) 48 62
Capital expenditure(7) (50) (38)
Working capital (pre-IFRS 16)(11) (54) (72)
Net tax refunded/(paid) 5 (17)
Net finance costs paid (pre-IFRS 16)(11) (10) (7)
Free cash flow(2) (61) (72)
The Group generated a Headline EBITDA(2) of £48m in the period (2025(1):
£62m) demonstrating the cash generative nature of the business. Capex was
£50m (2025(1): £38m(7)) as the Group continued to invest in new stores, IT
and energy efficient chillers and other store equipment. As expected, there
was a working capital outflow(8) of £54m in the period (2025(1): outflow(8)
of £72m), which results from a one-off payables timing headwind linked to one
of our large franchisor partners at the end of last year, new store openings,
and the seasonality of the business. In total, there was a free cash outflow
of £61m (2025(1): £72m).
(11) Excludes cash flow impact of non-underlying items
Capex was £50m (2025(1): £38m(7)) which includes the additional spend from
opening 36 stores around the world.
£m Feb 2026 Feb 2025(1,)(7)
New stores and store development 42 23
Refurbished stores 6 8
Systems 2 4
Other - 3
Total capital expenditure 50 38
Reconciliation of Headline net debt(2)
Headline net debt(2) is presented on a pre-IFRS 16 basis. See Note 8 and Note
A8 of the Glossary for the impact of IFRS 16 on net debt.
As at 28 February 2026, the Group had Headline net debt(2) of £496m
comprising convertible bonds of £325m and net overdrafts of £171m (31 August
2025: £390m, convertible bonds of £320m and net overdrafts of £70m).
Headline(2)
pre-IFRS 16
6 months to Year ended
£m Feb 2026 Feb 2025 Aug 2025(1)
Opening Headline net debt(2) (390) (371) (371)
Free cash flow(2) (61) (72) 63
Non-underlying items(2) - continuing operations (22) (18) (38)
Dividends paid (8) (29) (43)
Purchase of own shares for cancellation - (23) (50)
Receipt of pension surplus - 75 75
Non-underlying items(2) - discontinued operations (10) (4) (25)
Other (5) (12) (1)
Closing Headline net debt(2) (496) (454) (390)
Net overdraft (171) (139) (70)
Convertible bond (325) (315) (320)
Headline net debt(2) (496) (454) (390)
In addition to the free cash flow(2), the Group had outflows relating to
non-underlying items(2) from continuing operations of £22m mainly relating to
transformation projects and costs associated with the investigation into
accelerated recognition of supplier income in North America and this includes
costs charged in the prior year; the final dividend from 2025 of £8m; and a
net cash outflow related to separation costs associated with discontinued
operations of £10m.
Subject to investment opportunities, it is expected that Headline net debt(2)
will be in the region of £420m at the end of the year. The increase relates
to continuing investment in new stores in North America alongside ongoing
transformation costs.
On an IFRS 16 basis, net debt was £1,010m (August 2025: £874m; February
2025: £1,055m), which includes an additional £514m (August 2025: £484m;
February 2025: £601m) of lease liabilities.
Leverage(2) - Continuing operations
pre-IFRS 16(2)
£m Feb 2026
Headline EBITDA(2) - six months to Feb 2026 48
Headline EBITDA(2) - six months to Aug 2025 125
Headline net debt(2) 496
Leverage - multiple 2.9x
Leverage(2) at 28 February 2026 was 2.9x (August 2025(1): 2.1x), comprising
Headline net debt(2) over rolling 12 months of Headline EBITDA(2), with a
seasonal increase relating to the expected higher net debt at February 2026.
In the near-term, the Group plans to strengthen the balance sheet through
tighter cost control and improved cash generation to reduce leverage below
2.0x.
Fixed charges cover(2) - Continuing operations
pre-IFRS 16(2)
£m Feb 2026
Headline net finance costs before non-underlying items (2) (Note A1) - six 14
months to Feb 2026
Headline net finance costs before non-underlying items (2) (Note A1) - six 14
months to Aug 2025
Headline fixed operating lease charges(2) (Note A12) - six months to Feb 2026 131
Headline fixed operating lease charges(2) (Note A12) - six months to Aug 2025 121
Total fixed charges 280
Headline EBITDA(2) - six months to Feb 2026 (Note A13) 48
Headline EBITDA(2) - six months to Aug 2025 (Note A13) 125
Headline fixed operating lease charges(2) (Note A12) - six months to Feb 2026 131
Headline fixed operating lease charges(2) (Note A12) - six months to Aug 2025 121
Headline EBITDA before Headline fixed operating lease charges(2) 425
Fixed charges cover(2) - times 1.5x
Fixed charges, comprising property operating lease charges and net finance
costs, were covered 1.5 times (August 2025(1): 1.6 times) by Headline
EBITDA(2) before Headline fixed operating lease charges.
Return on capital employed(2) - Continuing operations
pre-IFRS 16(2)
Feb 2026 Aug 2025(1)
UK 36% 38%
North America 3% 4%
Rest of the World and Other 15% 22%
Group 16% 18%
Return on capital employed(2) is calculated as the Group operating profit
before non-underlying items(2) as a percentage of operating capital employed
and is stated on a pre-IFRS 16 basis. Operating capital employed is calculated
as the 12-month average net assets, excluding net debt, retirement benefit
surplus/obligation and net current and deferred tax balances.
Balance sheet
Headline(2)
IFRS pre-IFRS 16
£m Feb Aug 2025 Feb 2025(1) Feb 2026 Aug 2025 Feb 2025(1)
2026
Goodwill and other intangible assets 445 447 488 446 449 490
Property, plant and equipment 267 254 321 265 251 313
Right-of-use assets 393 367 467 - - -
Investments in joint ventures 2 2 2 2 2 2
Non-current investments 2 4 10 2 4 10
1,109 1,074 1,288 715 706 815
Inventories 140 148 212 140 148 212
Payables less receivables (109) (191) (141) (103) (181) (128)
Working capital 31 (43) 71 37 (33) 84
Net current and deferred tax asset 31 31 62 30 31 62
Net derivative liability (1) - - (1) - -
Provisions - (1) (17) (23) (25) (30)
Operating assets 1,170 1,061 1,404 758 679 931
Net debt (1,010) (874) (1,055) (496) (390) (454)
Net assets excluding retirement benefit surplus 160 187 349 262 289 477
Retirement benefit surplus 1 1 - 1 1 -
Total net assets 161 188 349 263 290 477
The Group had Headline net assets of £263m, £27m lower than at 31 August
2025. Under IFRS the Group had net assets of £161m (2025(1): £188m).
Events after the balance sheet date
On 10 March 2026, the first extension option on the term loan was exercised
taking the maturity date to 24 March 2029. On 11 March 2026, the US private
placements were fully drawn.
Total stores by region
No. of stores At 28
February 2026
UK 589
North America
Air 282
Resorts / Rail 80
Total North America 362
Rest of the World and Other 324
Total 1,275
PRINCIPAL AND EMERGING RISKS AND UNCERTAINTIES
The Group's Annual Report and Accounts 2025, a copy of which is available on
the Group's website at www.whsmithplc.co.uk, sets out the principal and
emerging risks and uncertainties which could impact the Group for the
remainder of the current financial year along with mitigating activities
relevant to each risk (see Annual Report and Accounts 2025 pages 65 to 71).
These include:
• treasury, financial and credit risk management;
• economic, political, competitive and market risks;
• brand standards;
• key suppliers and supply chain management;
• store portfolio;
• business interruption;
• reliance on key personnel;
• international expansion;
• cyber risk, data security and data privacy compliance;
and
• environment and social sustainability.
The Group continues to monitor and respond to the impact of the ongoing
conflict in the Middle East with respect to the principal risks listed above.
This announcement contains inside information which is disclosed in accordance
with the Market Abuse Regulations.
This announcement contains certain forward-looking statements with respect to
the operations, performance and financial condition of the Group. By their
nature, these statements involve uncertainty since future events and
circumstances can cause results to differ from those anticipated. Nothing in
this announcement should be construed as a profit forecast. We undertake no
obligation to update any forward-looking statements whether as a result of new
information, future events or otherwise.
WH Smith PLC
Condensed Group Income Statement
For the 6 months to 28 February 2026
6 months to 28 Feb 2026 6 months to 28 Feb 2025 restated(1) 12 months to 31 Aug 2025
(unaudited) (unaudited) (audited)
£m Note Before non-underlying items(2) Non-underlying items(3) Total Before non-underlying items(2) Non-underlying items(3) Total Before non-underlying items(2) Non-underlying items(3) Total
Revenue 2 748 - 748 716 - 716 1,553 - 1,553
Group operating profit/(loss) - continuing operations 2,3 27 (27) - 39 (21) 18 148 (99) 49
Net finance costs 4 (25) - (25) (22) - (22) (46) (1) (47)
Profit/(loss) before tax - continuing operations 2 (27) (25) 17 (21) (4) 102 (100) 2
Income tax credit/(expense) 5 - 4 4 (4) 3 (1) (44) 18 (26)
Profit/(loss) for the period - continuing operations 2 (23) (21) 13 (18) (5) 58 (82) (24)
(Loss)/profit for the period - discontinued operations - (2) (2) 13 (55) (42) 24 (137) (113)
Profit/(loss) for the period - total operations 2 (25) (23) 26 (73) (47) 82 (219) (137)
Attributable to equity holders of the parent (2) (25) (27) 24 (73) (49) 75 (219) (144)
Attributable to non-controlling interests 4 - 4 2 - 2 7 - 7
2 (25) (23) 26 (73) (47) 82 (219) (137)
Loss per share - continuing operations
Basic 7 (20.0) (5.5) (24.4)
Diluted 7 (20.0) (5.5) (24.4)
Loss per share - total operations
Basic 7 (21.6) (38.3) (113.4)
Diluted 7 (21.6) (38.3) (113.4)
( )
(1) Comparative periods have been restated to correct the accelerated supplier
income recognition and inventory related items in the North
America division (refer to Note 1b for further details) and to separately
disclose results from discontinued operations (refer to Note 1a for further
details).
(2) Alternative performance measure. The Group has defined and explained the
purpose of its alternative performance measures in the Glossary on page 48.
(3) See Note 3 for an analysis of non-underlying items. See Glossary on page
48 for a definition of Alternative Performance Measures.
( )
WH Smith PLC
Condensed Group Statement of Comprehensive Income
For the 6 months to 28 February 2026
£m 6 months to 28 Feb 2026 6 months to 28 Feb 2025 12 months to
(unaudited) restated(1) 31 Aug 2025
(unaudited) (audited)
Loss for the period (23) (47) (137)
Other comprehensive income/(loss):
Items that may be reclassified subsequently to the income statement:
Gains on cash flow hedges
- Net fair value gains - 1 -
Exchange differences on translation of foreign operations - 21 (9)
Other comprehensive income/(loss) for the period, net of tax - 22 (9)
Total comprehensive loss for the period (23) (25) (146)
Attributable to equity holders of the parent (28) (29) (150)
Attributable to non-controlling interests 5 4 4
(23) (25) (146)
Total comprehensive (loss)/income arising from:
Continuing operations (21) 17 (33)
Discontinued operations (2) (42) (113)
(23) (25) (146)
(1) Comparative periods have been restated to correct the accelerated supplier
income recognition and inventory related items in the North
America division (refer to Note 1b for further details) and to separately
disclose results from discontinued operations (refer to Note 1a for further
details).
WH Smith PLC
Condensed Group Balance Sheet
As at 28 February 2026
£m Note At 28 Feb 2026 (unaudited) At 28 Feb 2025 At 31 Aug 2025
restated(1) (audited)
(unaudited)
Non-current assets
Goodwill 11 401 428 402
Other intangible assets 11 44 60 45
Property, plant and equipment 11 267 321 254
Right-of-use assets 11 393 467 367
Investments in joint ventures 2 2 2
Non-current investments 2 10 4
Retirement benefit surplus 1 - 1
Deferred tax assets 19 43 16
Trade and other receivables 36 25 25
1,165 1,356 1,116
Current assets
Inventories 140 212 148
Trade and other receivables 77 109 102
Current tax receivable 19 19 23
Cash and cash equivalents 8 48 39 71
284 379 344
Total assets 1,449 1,735 1,460
Current liabilities
Trade and other payables (222) (275) (318)
Bank overdrafts and other borrowings 8 (544) (178) (461)
Lease liabilities 8 (99) (120) (90)
Derivative financial liabilities (1) - -
Current tax payable - - (1)
Short-term provisions - (2) (1)
(866) (575) (871)
Non-current liabilities
Bank loans and other borrowings 8 - (315) -
Long-term provisions - (15) -
Lease liabilities 8 (415) (481) (394)
Deferred tax liabilities (7) - (7)
(422) (811) (401)
Total liabilities (1,288) (1,386) (1,272)
Total net assets 161 349 188
Shareholders' equity
Called up share capital 28 28 28
Share premium 316 316 316
Capital redemption reserve 14 14 14
Translation reserve (16) 10 (15)
Other reserves (254) (267) (254)
Retained earnings 37 219 69
Total equity attributable to equity holders of the parent 125 320 158
Non-controlling interests 36 29 30
Total equity 161 349 188
( )
(1) Comparative periods have been restated to correct the accelerated supplier
income recognition and inventory related items in the North America division
and to reclassify certain receivables from current to non-current (refer to
Note 1b for further details).
WH Smith
PLC
Condensed Group Cash Flow Statement
For the 6 months to 28 February 2026
6 months to 12 months to
£m Note 28 Feb 2026 28 Feb 2025 restated(1) 31 Aug 2025
(unaudited)
(unaudited) (audited)
Operating activities
Cash generated from continuing operations 9 20 99 330
Interest paid(2) (18) (17) (32)
Financing arrangement fees (1) - (3)
Income taxes refunded/(paid) 5 (17) (28)
Net cash (outflow)/inflow from operating activities - discontinued operations (10) 27 9
Net cash (outflow)/inflow from operating activities (4) 92 276
Investing activities
Purchase of property, plant and equipment (46) (38) (77)
Purchase of intangible assets (4) (1) (4)
(Payment)/receipt on settlement of financial instruments - (6) 7
Proceeds received from investments 2 3 8
Net cash inflow/(outflow) from investing activities - discontinued operations 1 (12) (3)
Net cash outflow from investing activities (47) (54) (69)
Financing activities
Dividends paid (8) (29) (43)
Purchase of own shares for cancellation - (23) (50)
Distributions to non-controlling interests (3) (4) (7)
Net drawdown on borrowings 8 78 61 24
Capital repayments of obligations under leases(3) 8 (39) (41) (86)
Net cash outflow from financing activities - discontinued operations - (19) (30)
Net cash inflow/(outflow) from financing activities 28 (55) (192)
Net (decrease)/increase in cash and cash equivalents in the period (23) (17) 15
Opening cash and cash equivalents 71 56 56
Closing cash and cash equivalents 48 39 71
(1) Comparative periods have been restated to separately disclose results from
discontinued operations (refer to Note 1a for further details) and to
reclassify the Receipt from settlement of financial instruments from Operating
activities to Investing activities.
(2) Includes interest payments of £9m on lease liabilities (28 February 2025:
£10m; 31 August 2025: £16m) for continuing operations. Interest payments on
lease liabilities for discontinued operations were £nil (28 February 2025:
£2m; 31 August 2025: £4m).
(3) Capital repayments of obligations under leases for discontinued operations
were £nil (28 February 2025: £19m; 31 August 2025: £30m).
WH Smith PLC
Condensed Group Statement of Changes in Equity
For the 6 months to 28 February 2026
( )
£m Called up share capital and share premium Translation reserves Other reserves(2) Retained earnings Total equity attributable to equity holders of the parent Non-controlling interest Total equity
Capital redemption reserve
Balance at 1 September 2025 344 14 (15) (254) 69 158 30 188
(Loss)/profit for the period - total operations - - - - (27) (27) 4 (23)
Other comprehensive (loss)/income:
Exchange differences on translation of foreign operations - - (1) - - (1) 1 -
Total comprehensive (loss)/income for the period - - (1) - (27) (28) 5 (23)
Employee share schemes - - - - 3 3 - 3
Dividend paid (Note 6) - - - - (8) (8) - (8)
Distributions to non-controlling interest - - - - - - (3) (3)
Non-cash movement on non-controlling interests - - - - - - 4 4
Balance at 28 February 2026 (unaudited) 344 14 (16) (254) 37 125 36 161
Balance at 1 September 2024 - restated3 345 13 (9) (268) 315 396 26 422
(Loss)/profit for the period - total operations1 - - - - (49) (49) 2 (47)
Other comprehensive income:
Cash flow hedges - - - 1 - 1 - 1
Exchange differences on translation of foreign operations - - 19 - - 19 2 21
Total comprehensive (loss)/income for the period(1) - - 19 1 (49) (29) 4 (25)
Employee share schemes - - - - 5 5 - 5
Dividend paid (Note 6) - - - - (29) (29) - (29)
Share repurchase (1) 1 - - (23) (23) - (23)
Distributions to non-controlling interest - - - - - - (4) (4)
Non-cash movement on non-controlling interests - - - - - - 3 3
Balance at 28 February 20251 (unaudited) 344 14 10 (267) 219 320 29 349
Balance at 1 September 2024 - restated1 345 13 (9) (268) 315 396 26 422
(Loss)/profit for the year - total operations - - - - (144) (144) 7 (137)
Other comprehensive loss:
Exchange differences on translation of foreign operations - - (6) - - (6) (3) (9)
Total comprehensive (loss)/income for the year - - (6) - (144) (150) 4 (146)
Employee share schemes - - - - 5 5 - 5
Dividends paid (Note 6) - - - - (43) (43) - (43)
Share repurchase (1) 1 - - (50) (50) - (50)
Distributions to non-controlling interest - - - - - - (7) (7)
Non-cash movement on non-controlling interests - - - - - - 7 7
Disposals of businesses - - - 14 (14) - - -
Balance at 31 August 2025 (audited) 344 14 (15) (254) 69 158 30 188
( )
(1) Comparative periods have been restated to correct the accelerated supplier
income recognition and inventory related items in the North America division
and to reclassify certain receivables from current to non-current (refer to
Note 1b for further details).
(2) Other reserves includes Revaluation reserve of £2m (February 2025 and
August 2025: £2m), ESOP reserve of £(16)m (February 2025 and August 2025:
(£(25)m), convertible bond reserve of £40m (February 2025 and August 2025:
£40m), hedging reserve of £nil (February 2025: £1m; August 2025: £nil) and
Other reserves of £(280)m (February 2025: £(285)m; August 2025: £(271)m).
The 'Other' reserve includes reserves created in relation to the historical
capital reorganisation and proforma restatement of £(238)m (February 2025 and
August 2025: £(238)m), the demerger from Smiths News PLC in 2006 of £69m
(February 2025 and August 2025: £69m) and cumulative amounts relating to
employee share schemes of £(111)m (February 2025: £(116)m; August 2025:
£(102)m).
(3) Restated to correct the accelerated supplier income recognition and
inventory related items in the North America division resulting in a reduction
to retained earnings of £20m and non-controlling interest of £4m. Refer to
Note 1b of the Group's Annual Report and Accounts for further details.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
1. Basis of preparation, Accounting policies and Approval of Interim
Statement
These Condensed Interim Financial Statements for the 6 months to 28 February
2026 have been prepared in accordance with UK-adopted International Accounting
Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority.
The interim financial statements do not include all of the notes of the type
normally included in an annual financial report. Accordingly, this report
should be read in conjunction with the Group's Annual Report and Accounts
2025, which has been prepared in accordance with UK-adopted international
accounting standards and the requirements of the Companies Act 2006, and any
public announcements made by WH Smith PLC during the interim reporting period.
The financial information set out in this report does not constitute statutory
accounts within the meaning of section 435 of the Companies Act 2006. The
Annual Report and Accounts 2025 have been filed with the Registrar of
Companies. The auditors' report on those accounts was unqualified, did not
include a reference to any matters to which the auditors drew attention by way
of emphasis without qualifying the report and did not contain statements under
s498(2) or s498(3) of the Companies Act 2006.
The Condensed Interim Financial Statements have been prepared in accordance
with the accounting policies set out in the 2025 Annual Report and Accounts
and it is these accounting policies which are expected to be followed in the
preparation of the full financial statements for the financial year to 31
August 2026, except as outlined below.
Taxes on income in the interim period are accrued using the tax rate that
would be applicable to the expected total annual profit or loss.
The Group has adopted the amendments to IAS 21 regarding 'Lack of
exchangeability' which became mandatory for the first time during the current
financial year. The adoption of this amendment has had no material impact on
the Group.
Alternative performance measures (APMs)
The Group has identified certain measures that it believes will assist the
understanding of the performance of the business. These APMs are not defined
or specified under the requirements of IFRS.
The Group believes that these APMs, which are not considered to be a
substitute for, or superior to, IFRS measures, provide stakeholders with
additional useful information on the underlying trends, performance and
position of the Group and are consistent with how business performance is
measured internally. The APMs are not defined by IFRS and therefore may not be
directly comparable with other companies' APMs.
The key APMs that the Group uses include: measures before non-underlying
items, Headline profit before tax, Headline earnings per share, trading
profit, Headline trading profit, Headline Group profit from trading
operations, like-for-like revenue, gross margin, fixed charges cover, Headline
EBITDA, effective tax rate, net debt and Headline net debt, free cash flow,
return on capital employed and leverage. These APMs are set out in the
Glossary on page 48 including explanations of how they are calculated and how
they are reconciled to a statutory measure where relevant.
Non-underlying items
The Group has chosen to present a measure of profit and earnings per share
that excludes certain items, which are considered non-underlying and
exceptional due to their size, nature or incidence, or are not considered to
be part of the normal operations of the Group. The Group believes that the
separate disclosure of these items provides additional useful information to
users of the financial statements to enable a better understanding of the
Group's underlying financial performance.
Non-underlying items can include, but are not limited to, restructuring and
transformation costs linked to Board agreed programmes, costs relating to
M&A activity, impairment charges and other property costs, significant
items relating to pension schemes, amortisation of intangible assets acquired
in business combinations, and the related tax effect of these items. Reversals
associated with items previously reported as non-underlying, such as reversals
of impairments and releases of provisions or liabilities are also reported in
non-underlying items. Further details of non-underlying items recognised in
the Income statement in the current and prior year are provided in Note 3.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
1. Basis of preparation, Accounting policies and Approval of
Interim Statement (continued)
Going concern
The consolidated financial statements have been prepared on a going concern
basis. The directors are required to assess whether the Group can continue to
operate for at least 12 months from the date of approval of these financial
statements.
The Group overview describes the Group's financial position, cash flows and
borrowing facilities and also highlights the principal risks and uncertainties
facing the Group. The Group overview also sets out the Group's business
activities together with the factors that are likely to affect its future
developments, performance and position.
In making the going concern assessment, the directors have undertaken a
rigorous assessment of current performance and forecasts for the period to 31
August 2027, including expenditure commitments, capital expenditure and
available borrowing facilities. The covenants on the Group's facilities are
tested half-yearly and are based on fixed charges cover and leverage. The
directors have also considered the existence of factors beyond the going
concern period that could indicate that the going concern basis is not
appropriate. We received legal advice, and waivers were obtained where
required, for the facilities in place as at 28 February 2026 to allow for any
potential impacts as a result of the North America accounting issues. We are
not aware of any other events within the going concern period which could
trigger a breach of covenants associated with the facilities.
The directors have modelled a base case scenario consistent with the latest
Board approved forecasts, and include a number of assumptions including
passenger numbers, spend per passenger, headline trading margin and cost
inflation. Under this scenario the Group has significant liquidity and
complies with all covenant tests throughout the assessment period.
Whilst the Group has limited direct operations across the Middle East,
consideration has been given to the ongoing conflict, which commenced after
the base case forecast was prepared. This consideration includes potential
direct impacts through lower passenger volumes and indirect impacts including
weaker consumer sentiment and elevated inflationary pressures. As a result of
these challenges and the ongoing uncertainty, Middle East downside assumptions
for the six-month period to 31 August 2026 have been incorporated into the
severe, but plausible, downside assumptions.
The downside scenario therefore includes a 12 per cent reduction to revenue
and a 16 per cent reduction to headline trading profit for the six-month
period to 31 August 2026, compared to the base case to reflect this Middle
East uncertainty. For the remainder of the going concern period, the downside
scenario forecasts a decrease of revenue in a phased manner from five per cent
to 10 per cent relative to the base case, with the associated drop through to
headline trading profit together with a decrease in certain variable costs,
including turnover-based rents. Under this downside scenario, with additional
mitigations of suspended dividend payments, a 10% decrease in administrative
costs and reductions to or deferrals of certain capital expenditure, the Group
would continue to have liquidity headroom on its existing facilities and
comply with all covenant tests throughout the assessment period. The broader
grounding of aircraft, for a prolonged period due to global jet fuel
shortages, at airports out of which we operate is not considered plausible.
A reverse stress test scenario, which excludes further stress testing of the
Middle East downside assumptions, has been conducted to understand the level
of revenue downside that could be absorbed before covenants are breached. In
this reverse stress test scenario, without further mitigations to those
described in the above severe but plausible downside scenario, a covenant
breach occurs upon revenue decreasing by 11 per cent relative to the base case
on a phased basis over a 12-month period and a flat 11 per cent reduction for
the six months thereafter.
Based on the above analysis, whilst the Group acknowledges that there is
uncertainty in modelling future forecasts, principally in respect of the
ongoing Middle East conflict, the Group considers that sufficient mitigations
within its control remain available, including further reductions to or
deferrals of capital expenditure and further decreases to fixed costs, and the
Group would seek further mitigations outside of its control as considered
necessary, such that in the event of a more severe downside scenario to that
forecast, the Group would continue to have liquidity headroom on its existing
facilities and comply with all covenant tests throughout the assessment
period. Accordingly, the directors do not consider this uncertainty to reflect
a material uncertainty and have concluded that the Group is able to adequately
manage its financing and principal risks, and that the Group will be able to
continue to meet its obligations as they fall due and operate within the level
of its facilities for at least 12 months from the date of approval of these
financial statements.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
1. Basis of preparation, Accounting policies and Approval of Interim
Statement (continued)
a. Discontinued operations in the prior period
A discontinued operation is a component of the Group that (i) either has been
disposed of or is classified as held for sale; and (ii) represents a separate
major line of business or geographical area of operations or is part of a
single coordinated plan to dispose of a separate major line of business or
geographical area of operations. The results of discontinued operations are
presented as a single amount of profit or loss after tax in the consolidated
income statement, separate from the results of continuing operations.
Non-current assets or disposal groups classified as held for sale are measured
at the lower of their carrying amount and fair value less costs to sell.
Depreciation of such assets ceases once they are classified as held for sale.
On 28 March 2025, the Group agreed to sell its UK High Street business
comprising of approximately 480 stores to Modella Capital. The transaction
excluded the WH Smith brand, which was retained by the Group. The High Street
business represented a separate major line of business and geographical area
of operations. Accordingly, the results of this business have been classified
as discontinued operations in the prior period in accordance with IFRS 5. The
related assets and liabilities were derecognised on completion of the sale in
the year to 31 August 2025.
On 14 August 2025, the Group completed the sale of its online personalised
greeting cards business, funkypigeon.com Ltd, to Card Factory PLC for total
consideration of £25m. The associated cost of sale amounted to £3m.
funkypigeon.com Ltd was reported within the High Street segment, represented a
major line of business that the Group exited as part of its strategic shift to
become a travel-focused retailer and has therefore been classified as a
discontinued operation in accordance with IFRS 5. One of the factors in
concluding that funkypigeon.com Ltd constitutes a major line of business was
its inclusion within the High Street segment, which the Group has exited as
part of its strategic shift to become a travel-focused retailer. Its results
are presented within discontinued operations for the prior period, together
with those of the High Street business. The assets and liabilities of
funkypigeon.com Ltd were derecognised from the Group's consolidated statement
of financial position upon completion of the sale in the year to 31 August
2025.
The next page shows the Group income statement for the period to 28 February
2025 as previously reported along with the impact of discontinued operations.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
1. Basis of preparation, Accounting policies and Approval of Interim
Statement (continued)
a. Discontinued operations in the prior period (continued)
Group income statement for the 6 months to 28 February 2025
6 months to 28 February 2025 as previously reported Reclassification of discontinued operations 6 months to 28 February 2025 after reclassification of discontinued operations
£m Before non-underlying items Non-underlying items Total Before non-underlying items Non-underlying items Total Before non-underlying items Non-underlying items Total
Revenue 951 - 951 (235) - (235) 716 - 716
Group operating profit/(loss) - continuing operations 69 (86) (17) (20) 65 45 49 (21) 28
Finance costs (25) - (25) 3 - 3 (22) - (22)
Profit/(loss) before tax - continuing operations 44 (86) (42) (17) 65 48 27 (21) 6
Income tax (expense)/credit (11) 13 2 4 (10) (6) (7) 3 (4)
Profit/(loss) for the period - continuing operations 33 (73) (40) (13) 55 42 20 (18) 2
Profit/(loss) for the period - discontinued operations - - - 13 (55) (42) 13 (55) (42)
Profit/(loss) for the period - total operations 33 (73) (40) - - - 33 (73) (40)
Attributable to equity holders of the parent 30 (73) (43) - - - 30 (73) (43)
Attributable to non-controlling interests 3 - 3 - - - 3 - 3
33 (73) (40) - - - 33 (73) (40)
Total comprehensive loss (18) - (18)
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
1. Basis of preparation, Accounting policies and Approval of Interim
Statement (continued)
b. Restatement of prior year financial statements
In August 2025, the Group identified that the recognition of supplier income
was being accelerated and identified additional one-off costs regarding
inventory-related items in the North America division. As a result, prior year
consolidated financial statements have been restated. Amendments to the
previously reported consolidated primary financial statements for the period
to 28 February 2025 are shown below, after taking into account the adjustments
for discontinued operations arising from the sale of the High Street and
funkypigeon.com businesses in the year. The reclassification of discontinued
operations within the Group income statement have been presented in Note 1a.
Certain other reclassification restatements to primary financial statements
have also been identified and are set out below, including the
reclassification of certain receivables from current to non-current assets and
the reclassification of certain cash flows from operating cash flows to
investing cash flows.
Group income statement
6 months to 28 February 2025 after reclassification of discontinued operations Restatement 6 months to 28 February 2025 restated(1)
(unaudited)
£m Before non-underlying items Non-underlying items Total Before non-underlying items Non-underlying items Total Before non-underlying items Non-underlying items Total
Revenue 716 - 716 - - - 716 - 716
Group operating profit/(loss)1- continuing operations 49 (21) 28 (10) - (10) 39 (21) 18
Finance costs (22) - (22) - - - (22) - (22)
Profit/(loss) before tax - continuing operations 27 (21) 6 (10) - (10) 17 (21) (4)
Income tax (expense)/credit (7) 3 (4) 3 - 3 (4) 3 (1)
Profit/(loss) for the period - continuing operations 20 (18) 2 (7) - (7) 13 (18) (5)
Profit/(loss) for the period - discontinued operations 13 (55) (42) - - - 13 (55) (42)
Profit/(loss) for the period - total operations 33 (73) (40) (7) - (7) 26 (73) (47)
-
Attributable to equity holders of the parent 30 (73) (43) (6) - (6) 24 (73) (49)
Attributable to non-controlling interests 3 - 3 (1) - (1) 2 - 2
33 (73) (40) (7) - (7) 26 (73) (47)
Total comprehensive loss (18) (7) (25)
(1) All restatements impacting Group operating profit/(loss) relate to Cost of
sales.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
1. Basis of preparation, Accounting policies and Approval of Interim
Statement (continued)
b. Restatement of prior year financial statements (continued)
6 months to 28 February 2025 as previously reported1 Restatement 6 months to 28 February 2025 restated
£m Headline before non-underlying items Headline non-underlying items IFRS 16 Total Headline before non-underlying items Headline non-underlying items IFRS 16 Total Headline before non-underlying items Headline non-underlying items IFRS 16 Total
(pre-IFRS 16)
(pre-IFRS 16)
(pre-IFRS 16)
(pre-IFRS 16)
(pre-IFRS 16)
(pre-IFRS 16)
UK 40 - - 40 - - - - 40 - - 40
North America 15 - 3 18 (10) - - (10) 5 - 3 8
Rest of the World and Other1 2 - 3 5 - - - - 2 - 3 5
Group trading profit - continuing operations 57 - 6 63 (10) - - (10) 47 - 6 53
(1)( ) Restated for the revision to operating segments following the sale
of the High Street and funkypigeon.com businesses in 2025.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
1. Basis of preparation, Accounting policies and Approval of Interim
Statement (continued)
b. Restatement of prior year financial statements (continued)
Group income statement - disaggregation of restatement
Accelerated supplier income recognition Inventory related items Total restatement
£m Before non-underlying items Non-underlying items Total Before non-underlying items Non-underlying items Total Before non-underlying items Non-underlying items Total
Revenue - - - - - - - - -
Group operating loss1 (4) - (4) (6) - (6) (10) - (10)
Finance costs - - - - - - - - -
Loss before tax - continuing operations (4) - (4) (6) - (6) (10) - (10)
Income tax credit 1 - 1 2 - 2 3 - 3
Loss for the period - continuing operations (3) - (3) (4) - (4) (7) - (7)
Profit/(loss) for the period - discontinued operations - - - - - - - - -
Loss for the period - total operations (3) - (3) (4) - (4) (7) - (7)
Attributable to equity holders of the parent (3) - (3) (3) - (3) (6) - (6)
Attributable to non-controlling interests - - - (1) - (1) (1) - (1)
(3) - (3) (4) - (4) (7) - (7)
Total comprehensive loss (3) (4) (7)
( )
(1)( ) All restatements impacting Group operating loss relate to Cost of
sales
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
1. Basis of preparation, Accounting policies and Approval of Interim
Statement (continued)
b. Restatement of prior year financial statements (continued)
Group earnings per share
£m 6 months to 28 February 2025 Reclassification of discontinued operations 6 months to 28 February 2025 after reclassification of discontinued operations Accelerated supplier income recognition Inventory related items 6 months to 28 February 2025
As previously reported
Restated
Basic (loss)/earnings per share - continuing operations (33.6) 32.8 (0.8) (2.4) (2.3) (5.5)
Diluted (loss)/earnings per share - continuing operations (33.6) 32.8 (0.8) (2.4) (2.3) (5.5)
Basic (loss)/earnings per share - total operations (33.6) - (33.6) (2.4) (2.3) (38.3)
Diluted (loss)/earnings per share - total operations (33.6) - (33.6) (2.4) (2.3) (38.3)
Group cash flow statement extract - 6 months to 28 February 2025
£m 6 months to 28 February 2025 Classification of financial instrument settlements1 6 months to 28 February 2025
As previously reported
Restated
Net cash inflows from operating activities 86 6 92
Net cash outflows from investing activities (48) (6) (54)
Net cash outflows from financing activities (55) - (55)
Net decrease in cash in the period (17) - (17)
(1) Reclassification of cash flows linked to the settlement of financial
instruments from operating to investing activities.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
1. Basis of preparation, Accounting policies and Approval of Interim
Statement (continued)
b. Restatement of prior year financial statements (continued)
Group balance sheet extract - as at 28 February 2025
£m As at 28 February 2025 Accelerated Inventory Other receivables: current vs non-current1 As at 28 February 2025
As previously reported
supplier income recognition
related items
Restated
Deferred tax assets 38 5 - - 43
Trade and other receivables 11 - - 14 25
Total non-current assets 1,337 5 - 14 1,356
Inventories 225 (4) (9) - 212
Trade and other receivables 133 (10) - (14) 109
Current tax receivable 16 1 2 - 19
Total current assets 413 (13) (7) (14) 379
Trade and other payables (259) (9) (7) - (275)
Total current liabilities (559) (9) (7) - (575)
Total non-current liabilities (811) - - - (811)
Total net assets 380 (17) (14) - 349
Retained earnings 245 (14) (12) - 219
Non-controlling interests 34 (3) (2) - 29
Total equity 380 (17) (14) - 349
(1) Reclassification of certain receivables related to joint venture
arrangements in North America from current to non-current.
c. Critical accounting judgements and key sources of
estimation uncertainty
The preparation of condensed interim financial statements in conformity with
generally accepted accounting principles requires management to make
judgements, estimates and assumptions that affect the reported amounts of
assets and liabilities and the disclosure of contingent assets and
liabilities. Actual results could differ from these estimates and any
subsequent changes are accounted for with an effect on income at the time such
updated information becomes available.
The most critical accounting judgements and sources of estimation uncertainty
in determining the financial condition and results of the Group are those
requiring the greatest degree of subjective or complex judgement. These relate
to the classification of items as non-underlying; assessment of lease
substitution rights; determination of the lease term; impairment indicator
assessment for store-based non-current assets; and revenue growth assumptions
in the Rest of the World and Other goodwill impairment assessment. Other
estimates include the measurement of contingent consideration related to the
sale of the High Street business; valuation of inventory; and supplier income
accounting. The key areas where the judgments, estimates and assumptions
applied have a significant risk of causing a material adjustment to the
carrying value of assets and liabilities are consistent with those applied in
the Group's financial statements for the year to 31 August 2025, as set out on
pages 159 to 160 of those financial statements.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
2. Segmental analysis of results
IFRS 8 requires segment information to be presented on the same basis as that
used by the Chief Operating Decision Maker for assessing performance and
allocating resources. The Group's operating segments are based on the reports
reviewed by the Board of Directors who are collectively considered to be the
Chief Operating Decision maker.
Following the sale of the High Street and funkypigeon.com businesses during
the year to 31 August 2025, for management and financial reporting purposes,
the continuing operations of the Group are organised into three divisions and
reportable segments - UK, North America and Rest of the World and Other.
The information presented to the Board is prepared in accordance with the
Group's IFRS accounting policies, with the exception of IFRS 16, and is shown
below as Headline information in section b). A reconciliation to statutory
measures is provided below in accordance with IFRS 8, and in the Glossary on
page 53 (Note A2).
a) Revenue
6 months to 12 months to
£m 28 Feb 2026 28 Feb 2025 restated1 31 Aug 2025
(unaudited)
(unaudited)
(audited)
UK 392 384 834
North America 204 194 413
Rest of the World and Other 152 138 306
Revenue - continuing operations 748 716 1,553
Revenue - discontinued operations - 235 358
Revenue - total operations 748 951 1,911
(1) Comparative periods have been restated to separately disclose results from
discontinued operations (refer to Note 1a for further details).
Revenue in the Group is subject to seasonal fluctuations, with higher demand
during peak travel periods particularly during the summer holiday months,
which fall in the second half.
Rest of the World revenue includes revenue from Australia of £46m (28
February 2025: £43m), Ireland £29m (28 February 2025: £27m) and Spain £27m
(28 February 2025: £24m). No other country has individually material revenue.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
2. Segmental analysis of results (continued)
b) Group results
6 months to 28 Feb 2026 6 months to 28 Feb 2025 restated1
(unaudited) (unaudited)
£m Headline before non-underlying items(2) Headline non-underlying items(2) IFRS 16 Total Headline before non-underlying items(2) Headline IFRS 16 Total
(pre-IFRS 16) (pre-IFRS16) (pre-IFRS 16) non-underlying items(2)
(pre-IFRS16)
UK 34 - 4 38 40 - - 40
North America 2 - 7 9 5 - 3 8
Rest of the World and Other (4) - (1) (5) 2 - 3 5
Group trading profit - continuing operations 32 - 10 42 47 - 6 53
Unallocated central costs (15) - - (15) (14) - - (14)
Group operating profit before non-underlying items - continuing operations 17 - 10 27 33 - 6 39
Non-underlying items (Note 3) - (28) 1 (27) - (20) (1) (21)
Group operating profit/(loss) - continuing operations 17 (28) 11 - 33 (20) 5 18
Finance costs (14) - (11) (25) (12) - (10) (22)
Profit/(loss) before tax - continuing operations 3 (28) - (25) 21 (20) (5) (4)
Income tax credit/(expense) - 4 - 4 (4) 3 - (1)
Profit/(loss) for the period - continuing operations 3 (24) - (21) 17 (17) (5) (5)
(Loss)/profit for the period - discontinued operations - (2) - (2) 10 (45) (7) (42)
Profit/(loss) for the period - total operations 3 (26) - (23) 27 (62) (12) (47)
(1 ) Comparative periods have been restated to correct the accelerated
supplier income recognition and inventory related items in the North America
division (refer to Note 1b for further details) and to separately disclose
results from discontinued operations (refer to Note 1a for further details).
(2)( )( ) Presented on a pre-IFRS 16 basis. Alternative Performance
Measures are defined and explained in the Glossary on page 48.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
2. Segmental analysis of results (continued)
c) Other segmental items
6 months to 28 Feb 2026 (unaudited)
Non-current assets(1) Right-of-use assets
£m Capital additions Depreciation and amortisation Impairment Depreciation Impairment
UK 20 (11) - - -
North America 30 (11) - - -
Rest of the World and Other 2 (5) - - -
Headline, before non-underlying items (pre-IFRS 16) - continuing operations 52 (27) - - -
Headline non-underlying items (pre-IFRS 16) - (1) (11) - -
Headline, after non-underlying items (pre-IFRS 16) - continuing operations 52 (28) (11) - -
Impact of IFRS 16 - - - (40) -
Non-underlying items (IFRS 16)(2) - - (1) - (4)
Group - continuing operations 52 (28) (12) (40) (4)
6 months to 28 Feb 2025 restated2 (unaudited)
Non-current assets(1) Right-of-use assets
£m Capital additions Depreciation and amortisation Impairment Depreciation Impairment
UK 13 (11) - - -
North America 20 (10) - - -
Rest of the World and Other 6 (4) - - -
Headline, before non-underlying items (pre-IFRS 16) - continuing operations 39 (25) - - -
Headline non-underlying items (pre-IFRS 16) - (2) (5) - -
Headline, after non-underlying items (pre-IFRS 16) - continuing operations 39 (27) (5) - -
Impact of IFRS 16 - - - (40) -
Non-underlying items (IFRS 16) - - - - (1)
Group - continuing operations 39 (27) (5) (40) (1)
Group - discontinued operations 11 (8) (32) (15) (17)
Group - total operations 50 (35) (37) (55) (18)
(1) Non-current assets including property, plant and equipment and intangible
assets, but excluding right-of-use assets.
(2) Comparative periods have been restated to separately disclose results from
discontinued operations (refer to Note 1a for further details).
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
2. Segmental analysis of results (continued)
d) Write-down of inventory
6 months to 12 months to
£m 28 Feb 2026 28 Feb 2025 31 Aug 2025
(audited)
(unaudited) (unaudited)
Write-down of inventory - continuing operations 17 15 40
3. Non-underlying items
Items which are considered exceptional due to their size, nature or incidence,
or are not considered to be part of the normal operations of the Group not
considered part of the normal operating costs of the business are treated as
non-underlying items and disclosed separately. Further details of the
definition of the non-underlying items are included in Note 1.
6 months to 12 months to
£m 28 Feb 2026 28 Feb 2025 31 Aug 205
(audited)
(unaudited) restated1
(unaudited)
Amortisation of acquired intangible assets 1 2 3
Impairment of non-current assets
- property, plant and equipment 11 5 24
- intangible assets 1 - -
- right-of-use assets 4 1 29
Provisions for onerous contracts - 1 3
Transformation programmes - IT 4 3 11
Transformation programmes - supply chain - 2 3
Transformation programmes - operational efficiencies 2 7 11
Costs associated with the investigation into accelerated recognition of 3 - 10
supplier income in North America
Impairment of other receivables 2 - 3
Costs related to M&A activity and Group legal entity structure - - 1
IFRS 16 remeasurement gains (2) - -
Other non-underlying costs 1 - 1
Non-underlying items, included in operating profit - continuing operations 27 21 99
Finance costs associated with onerous contracts - - 1
Non-underlying items, before tax - continuing operations 27 21 100
Tax credit on non-underlying items (4) (3) (18)
Non-underlying items, after tax - continuing operations 23 18 82
Non-underlying items, after tax - discontinued operations 2 55 137
Non-underlying items, after tax - total operations 25 73 219
(1) Comparative periods have been restated to separately disclose results from
discontinued operations (refer to Note 1a for further details).
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
3. Non-underlying items (continued)
Amortisation of acquired intangible assets
Amortisation of acquired intangible assets primarily relates to the MRG and
InMotion brands.
Impairment of non-current assets
The Group has carried out an assessment for indicators of impairment of
non-current assets across the store portfolio. Where an indicator of
impairment has been identified, an impairment review has been performed to
compare the value-in-use of cash generating units ('CGUs'), based on
management's assumptions regarding likely future trading performance, to the
carrying value of the CGUs.
As a result of this exercise, a non-cash charge of £16m (28 February 2025:
£6m) was recorded within non-underlying items for impairment of non-current
assets, of which £11m (28 February 2025: £5m) relates to property, plant and
equipment, £1m (28 February 2025: £nil) relates to intangible assets and
£4m (28 February 2025: £1m) relates to right-of-use assets. Of the total
impairment charge, £1m (28 February 2025: £3m) is attributable to the UK
operating segment, £12m (28 February 2025: £3m) to North America and £3m
(28 February 2025: £nil) to Rest of the World and Other. Impairment charges
in the North America and Rest of the World and Other operating segments have
principally arisen due to a lower trading outlook in certain individual stores
across these regions.
The impairment recognised on a pre-IFRS 16 basis is provided in note A6 of the
Glossary on page 56.
Provisions for onerous contracts
A charge of £nil (28 February 2025: £1m) has been recognised in the income
statement to provide for the unavoidable costs of continuing to service a
number of non-cancellable supplier and property contracts where the space is
vacant, a contract is loss-making or currently not planned to be used for
ongoing operations.
Transformation programmes - IT
Administrative expenses of £4m (28 February 2025: £3m) have been classified
as non-underlying in relation to a Board-approved IT transformation programme.
The IT transformation programme includes one-off costs relating to upgrading
core IT infrastructure, data migration and investment in data security, store
systems modernisation and other significant IT projects. These strategic
projects will provide additional stability, longevity and operational
benefits. The programme is expected to complete in the next financial year.
Transformation programmes - operational efficiencies
Administrative expenses of £2m (28 February 2025: £7m) have been classified
as non-underlying in relation to Board-approved programmes relating to
operational efficiencies. This programme commenced in the year to 31 August
2025 and costs include head office restructuring and transformation costs
across all segments. This programme will deliver a more efficient operating
model to support the Group's strategic objectives. The current programme will
largely complete in FY26.
Costs associated with the investigation into accelerated recognition of
supplier income in North America
Administrative expenses incurred during the period include £3m (28 February
2025: £nil) of professional fees in relation to the investigation into
accelerated recognition of supplier income in North America, including costs
of the investigation, remediation and regulatory related costs. We expect
further costs in FY26 due to ongoing regulatory related professional fees.
Impairment of other receivables
The Group's other receivables include amounts due from non-controlling
interest equity shareholders in certain of the Group's US subsidiaries which
relate to contributions owed towards property, plant and equipment
construction for stores and are received in accordance with the cash
requirements of the subsidiary. Certain of these contributions are no longer
considered to be recoverable based on the expected credit loss that considers
the counterparty's ability to pay, which reflects the financial outlook of the
associated stores. Such expected credit losses of £2m (28 February 2025:
£nil) are recognised within non-underlying items where an impairment charge
for store non-current assets has also been recognised within non-underlying
items.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
3. Non-underlying items (continued)
IFRS 16 remeasurement gains
IFRS 16 remeasurement gains of £2m (28 February 2025: £nil) have arisen from
the derecognition of lease liabilities on exit of certain locations, in which
right-of-use assets were previously impaired.
A tax credit of £4m (28 February 2025: £3m) has been recognised in relation
to non-underlying items.
4. Net finance costs
6 months to 12 months to
£m 28 Feb 2026 28 Feb 2025 31 Aug 2025
(unaudited) restated1 (audited)
(unaudited)
Interest payable on bank loans and overdrafts 7 5 11
Interest on convertible bonds 8 7 15
Interest on lease liabilities 11 10 20
Interest income on joint venture loans (1) - -
Non-underlying finance costs - - 1
Total Group - continuing operations 25 22 47
Total Group - discontinued operations - 3 3
Total Group 25 25 50
(1) Comparative periods have been restated to separately disclose results from
discontinued operations (refer to Note 1a for further details).
Interest on convertible bonds includes £3m (28 February 2025: £2m) coupon
interest, £4m (28 February 2025: £4m) non-cash debt accretion charges and
£1m (28 February 2025: £1m) fee amortisation.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
5. Income tax (credit)/expense
6 months to 12 months to
£m 28 Feb 2026 28 Feb 2025 31 Aug 2025
(unaudited) restated1 (audited)
(unaudited)
Tax on profit - 4 23
Adjustment in respect of prior years - - (6)
Total current tax expense - 4 17
Deferred tax - current period - - 27
Deferred tax - prior period - - 2
Deferred tax - change in tax rates - - (2)
Tax on profit before non-underlying items - 4 44
Tax on non-underlying items - current tax (1) (2) (10)
Tax on non-underlying items - deferred tax (3) (1) (8)
Total tax on (loss)/profit - continuing operations (4) 1 26
Total tax on (loss)/profit - discontinued operations - (6) (3)
Total tax on (loss)/profit - total operations (4) (5) 23
(1) Comparative periods have been restated to correct the accelerated supplier
income recognition and inventory related items in the North America division
(refer to Note 1b for further details) and to separately disclose results from
discontinued operations (refer to Note 1a for further details).
The effective tax rate, before non-underlying items, was a charge of 26 per
cent (28 February 2025: charge of 23 per cent). The UK corporation tax rate is
25 per cent.
The legislation implementing the Organisation for Economic Co-Operation and
Development's (OECD) proposals for a global minimum corporation tax rate
(Pillar Two) was substantively enacted in the UK on 20 June 2023 and applies
to reporting periods beginning on or after 1 January 2024.
Under the legislation the Group is liable to pay a top-up tax for the
difference between their Global Anti-Base Erosion Rules (GloBE) effective tax
rate per jurisdiction and the 15% minimum rate.
The rules are applicable to the Group for the year to 31 August 2025 onwards.
The Group has performed an assessment of the Group's potential exposure to
Pillar Two top-up taxes. Based on this assessment, the Pillar Two effective
tax rates in most of the jurisdictions in which the Group operates are above
15% or will meet the financial thresholds required to meet the Transitional
Safe Harbour Rules. However, there are a limited number of jurisdictions
where the Transitional Safe Harbour relief does not apply, and the Pillar Two
effective rate is close to 15%. There is not a material exposure to Pillar
Two taxes in those jurisdictions.
The Group applies the temporary exception from the accounting requirements
for deferred taxes in IAS 12. Accordingly, the Group neither recognises nor
discloses information about deferred taxes in relation to Pillar Two.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
6. Dividends
Amounts paid and recognised as distributions to shareholders in the year are
as follows:
6 months to 12 months to
£m 28 Feb 2026 28 Feb 2025 31 Aug 2025
(unaudited) (unaudited) (audited)
Dividends
Final dividend for the year to 31 August 2025 of 6.0p per ordinary share 8 - -
Interim dividend for the 6 months to 28 February 2025 - - 14
of 11.3p per ordinary share
Final dividend for the year to 31 August 2024 of 22.6p per ordinary share - 29 29
8 29 43
The Board has not declared an interim dividend in respect of the six-month
period to 28 February 2026.
7. (Loss)/earnings per share
a) (Loss)/earnings
6 months to 12 months to
£m 28 Feb 2026 28 Feb 2025 31 Aug 2025
(unaudited) restated1 (audited)
(unaudited)
(Loss)/profit for the period before non-underlying items, attributable to equity holders of the parent - continuing operations (2) 11 51
Non-underlying items, after tax (Note 3) (23) (18) (82)
Loss for the period, attributable to equity holders of the parent - continuing operations (25) (7) (31)
Loss for the period - discontinued operations (2) (42) (113)
Total loss for the period, attributable to equity holders of the parent (27) (49) (144)
(1) Comparative periods have been restated to correct the accelerated supplier
income recognition and inventory related items in the North America division
(refer to Note 1b for further details) and to separately disclose results from
discontinued operations (refer to Note 1a for further details).
( )
b) Weighted average share capital
6 months to 12 months to
Number (millions) 28 Feb 2026 28 Feb 2025 31 Aug 2025
(unaudited) (unaudited) (audited)
Weighted average ordinary shares in issue 126 130 129
Less weighted average ordinary shares held in ESOP Trust (1) (2) (2)
Weighted average shares in issue for earnings per share 125 128 127
Add weighted average number of ordinary shares under option 1 2 2
Weighted average ordinary shares for diluted earnings per share 126 130 129
( )
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
7. (Loss)/earnings per share (continued)
6 months to 12 months to
Pence 28 Feb 2026 28 Feb 2025 31 Aug 2025
(unaudited) restated1 (audited)
(unaudited)
Basic (loss)/earnings per share before non-underlying items - continuing operations (1.6) 8.6 40.2
Adjustment for non-underlying items (18.4) (14.1) (64.6)
Basic loss per share - continuing operations (20.0) (5.5) (24.4)
Basic loss per share - discontinued operations (1.6) (32.8) (89.0)
Basic loss per share - total operations (21.6) (38.3) (113.4)
Diluted (loss)/earnings per share before non-underlying items - continuing operations (1.6) 8.5 39.5
Adjustment for non-underlying items (18.4) (13.8) (63.6)
Impact of antidilutive potential shares - (0.2) (0.3)
Diluted loss per share - continuing operations (20.0) (5.5) (24.4)
Diluted loss per share - discontinued operations (1.6) (32.8) (89.0)
Diluted loss per share - total operations (21.6) (38.3) (113.4)
(1) Comparative periods have been restated to correct the accelerated supplier
income recognition and inventory related items in the North America division
(refer to Note 1b for further details) and to separately disclose results from
discontinued operations (refer to Note 1a for further details).
Diluted earnings per share takes into account various share awards and share
options including SAYE schemes, which are expected to vest, and for which a
sum below fair value will be paid.
When the numerator in the earnings per share calculation is a loss, the
weighted average number of ordinary shares applied is the basic value, rather
than the diluted value, as the inclusion of potentially dilutive shares would
improve the loss per share. As at 28 February 2026 the convertible bond has no
dilutive effect as the inclusion of these potentially dilutive shares would
improve earnings per share (28 February 2025 and 31 August 2025: No dilutive
effect). Furthermore, the probability of the bond converting before its
maturity in May 2026 is considered to be remote given the disparity between
the bond conversion price and the current share price.
The calculation of earnings per share on a pre-IFRS 16 basis is provided in
note A4 of the Glossary on pages 54 to 55.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
8. Analysis of net debt
Movement in net debt can be analysed as follows:
£m Convertible bonds Revolving credit facility Leases Sub-total Cash and cash equivalents Net debt
Liabilities from financing activities
At 1 September 2025 (320) (141) (484) (945) 71 (874)
Bond accretion and fee amortisation (5) - - (5) - (5)
Lease additions, modifications and interest - - (77) (77) - (77)
Cash movements - (78) 48 (30) (23) (53)
Currency translation - - (1) (1) - (1)
At 28 February 2026 (unaudited) (325) (219) (514) (1,058) 48 (1,010)
£m Convertible bonds Revolving credit facility Leases Sub-total Liabilities from financing activities Cash and cash equivalents Net debt
At 1 September 2024 (310) (117) (626) (1,053) 56 (997)
Bond accretion and fee amortisation (5) - - (5) - (5)
Lease additions, modifications and interest - - (38) (38) - (38)
Cash movements - (61) 72 11 (17) (6)
Currency translation - - (9) (9) - (9)
At 28 February 2025 (unaudited) (315) (178) (601) (1,094) 39 (1,055)
An analysis of Net debt on a pre-IFRS 16 basis, is provided in note A8 of the
Glossary on page 57.
Cash and cash equivalents
Cash and cash equivalents comprise cash held by the Group and short-term bank
deposits with an original maturity of three months or less. The carrying
amount of these assets approximates to their fair value.
Lease liabilities
Non-cash movements in lease liabilities mainly relate to new leases,
modifications, measurements and interest in the year. Cash movements on leases
include principal repayments of £39m (28 February 2025: £60m) and interest
paid of £9m (28 February 2025: £12m).
Revolving credit facilities
The Group has a £400m committed revolving credit facility ("RCF"). The last
extension option was exercised during the previous financial year, taking the
maturity to 13 June 2030.
The RCF is provided by a syndicate of banks: Barclays Bank PLC, BNP Paribas,
Citibank N.A. London Branch, Fifth Third Bank National Association, HSBC UK
Bank PLC, JP Morgan Securities PLC, PNC Capital Markets LLC, Banco Santander
SA London Branch and Skandinaviska Enskilda Banken AB (PUBL). Utilisation is
interest bearing at a margin over SONIA. As at 28 February 2026, the Group has
drawn down £219m on the RCF (28 February 2025: £178m).
Transaction costs of £5m relating to the RCF have been capitalised and are
amortised to the Income statement on a straight-line basis.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
8. Analysis of net debt (continued)
Revolving credit facilities (continued)
The Group considers in respect of its revolving credit facility, which has a
maturity date of 13 June 2030 and carries financial covenants, there is not a
right to defer settlement for at least 12 months from the reporting date
following a requirement to restate the statutory company financial statements
of certain subsidiaries that act as guarantors to the facility. Such
restatements comprise primary statement reclassifications only with no impact
on profit before tax or net assets. Whilst waivers were subsequently agreed
with lenders, these were not in place at 28 February 2026. As a result, the
amounts drawn down under the facility are presented as a current liability.
The Group anticipates that such amounts may be reclassified to non-current
liabilities in future reporting periods.
Convertible bonds
The Group issued £327m guaranteed senior unsecured convertible bonds on 7 May
2021 with a 1.625 per cent per annum coupon payable semi-annually in arrears
in equal instalments. The bonds are convertible into new and/or existing
ordinary shares of WH Smith PLC. The initial conversion price was set at
£24.99 representing a premium of 40 per cent above the reference share price
on 28 April 2021 (£17.85). The conversion price at 28 February 2026 was
£23.3660 (28 February 2025: £23.6106). If not previously converted, redeemed
or purchased and cancelled, the bonds will be redeemed at par on 7 May 2026.
The convertible bond is a compound financial instrument, consisting of a
financial liability component and an equity component, representing the value
of the conversion rights. The initial fair value of the liability portion of
the convertible bond was determined using a market interest rate for an
equivalent non-convertible bond at the issue date. The liability is
subsequently recognised on an amortised cost basis using the effective
interest rate method until extinguished on conversion or maturity of the
bonds. The remainder of the proceeds was allocated to the conversion option
and recognised in equity (Other reserves), and not subsequently remeasured. As
a result, £41m of the initial proceeds of £327m was recognised in equity
representing the option component.
Transaction costs of £6m were allocated between the two components and the
element relating to the debt component of £5m is amortised through the
effective interest rate method. The issue costs apportioned to the equity
component of £1m have been deducted from equity.
Term loans
The Group has a three-year £120m committed term loan. The term loan has two
uncommitted extension options of one year, which would, subject to lender
approval, extend the maturity date to 24 March 2030. On the 10 March 2026 the
first extension option was exercised taking the maturity date to the 24 March
2029.
The term loan is provided by a syndicate of banks: Fifth Third Bank National
Association, HSBC UK Bank PLC, Banco Santander SA London Branch and
Skandinaviska Enskilda Banken AB (PUBL). Utilisation is interest bearing at a
margin over SONIA. As at 28 February 2026, the term loan is undrawn.
Transaction costs of £1m relating to the term loan have been capitalised and
are amortised to Income statement on a straight-line basis.
US private placements
The Group has £200m of committed US Private Placement notes ("USPP") which
have a tenor of seven, ten and twelve years. Utilisation is interest bearing
at a fixed rate. As at 28 February 2026, the USPP notes are undrawn. On the 11
March 2026, the USPP was fully drawn. Transaction costs of £1m relating to
the USPP have been capitalised and are amortised to Income statement on a
straight-line basis.
Backstop facility
In November 2025, the Group entered into a £200m syndicated 12-month term
loan. The facility is provided by a syndicate of banks: PNC Capital Markets
LLC, J.P. Morgan Securities PLC, BNP Paribas, London Branch and Skandinaviska
Enskilda Banken AB (PUBL). The loan has two extension options, which would, if
exercised, extend the maturity date to 31 August 2027. As at 28 February 2026,
the syndicated loan is undrawn. On the 11 March 2026 the syndicated 12-month
term loan was cancelled.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
9. Cash generated from continuing operations
6 months to 12 months to
£m 28 Feb 2026 28 Feb 2025 31 Aug 2025
(unaudited) restated1 (audited)
(unaudited)
Group operating profit - continuing operations - 18 49
Depreciation of property, plant and equipment 24 22 45
Impairment of property, plant and equipment 11 5 24
Amortisation of intangible assets 4 5 9
Impairment of intangible assets 1 - -
Depreciation of right-of-use assets 40 40 80
Impairment of right-of-use assets 4 1 29
Share-based payments 3 4 3
Gain on remeasurement of leases (4) - (1)
Other non-cash items (incl. foreign exchange) 1 - (1)
Decrease/(increase) in inventories 9 (9) (22)
Decrease in receivables 17 11 9
(Decrease)/increase in payables (89) (71) 33
Receipt of retirement benefit surplus - 75 75
Movement on provisions (1) (2) (2)
Cash generated from continuing operations 20 99 330
(1) Comparative periods have been restated to correct the accelerated supplier
income recognition and inventory related items in the North America division
(refer to Note 1b for further details), to re-present settlement receipts for
swap contracts as investing activities and to separately disclose results from
discontinued operations (refer to Note 1a for further details).
10. Supplier Income
Amounts related to supplier income held on the Balance Sheet are as follows:
£m At 28 Feb 2026 (unaudited) At 28 Feb 2025 At 31 Aug
(unaudited) 2025
(audited)
Within inventories (9) (10) (8)
Within trade and other receivables
Trade receivables 20 33 44
Accrued income 20 29 23
Within trade and other payables
Trade payables1 15 12 14
Deferred income (12) (15) (20)
(1 ) Trade payables is stated net of £15m (28 February 2025: £12m)
amounts receivable from suppliers in relation to supplier income, that has
been invoiced, for which the Group has the right to set off against amounts
payable at the balance sheet date.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2026
11. Non-current assets
During the six months to 28 February 2026, there were additions to property,
plant and equipment of £48m (28 February 2025: £47m). There were no material
disposals of tangible assets during the period (28 February 2025: £nil).
During the six months to 28 February 2026, there were increases to
right-of-use assets of £70m (28 February 2025: £28m) through signing of new
leases and lease modifications.
Additions to intangible assets totalled £4m (28 February 2025: £3m) in the
period. There were no material disposals of intangible assets during the
period (28 February 2025: £nil).
Goodwill decreased by £1m in the period due to movements in exchange rates
(28 February 2025: increased by £2m as a result of impairment of goodwill
associated with the High Street segment of £15m, offset by movements in
exchange rates of £17m).
Impairment of store-based non-current assets
For impairment testing purposes, the Group has determined that each store is a
separate CGU or in some cases a group of stores is considered to be a CGU
where the stores do not generate largely independent cash inflows. Grouping is
limited to certain stores at the same airport and/or with the same landlord,
being the level at which decisions are made regarding the continuing or
disposing of store operations.
For those CGUs where an indicator of impairment has been identified, property,
plant and equipment and right-of-use assets have been tested for impairment by
comparing the carrying amount of the CGU with its recoverable amount
determined from value-in-use calculations. It was determined that value-in-use
was higher than fair value less costs to sell.
The value-in-use of CGUs is calculated in a consistent manner with and
underpinned by the same key assumptions as those described in the Group's 2025
Annual Report and Accounts, except for use of a pre-tax discount rate of 10.6
per cent (31 August 2025: 12.6 per cent).
Where the value-in-use was less than the carrying value of the CGU, an
impairment of property, plant and equipment and right-of-use assets was
recorded. The Group has recognised an impairment charge of £11m (28 February
2025: £5m) to property, plant and equipment, £4m (28 February 2025: £1m) to
right-of-use assets and £1m (28 February 2025: £nil) to intangible assets.
Impairments to non-current assets have been presented as non-underlying items
(see Note 3).
Impairment of goodwill and other indefinite-lived intangible assets
The Group tests goodwill and other indefinite-lived intangible assets for
impairment annually or where there is an indication that goodwill might be
impaired. In determining whether an indicator of impairment is present, the
Group considers internal and external factors, and the significance by which
the recoverable amount exceeded the carrying value in the annual impairment
test performed as of 31 August 2025. As of 28 February 2026, the Group has
tested the Rest of the World and Other segment for impairment.
The value-in-use of the CGU is calculated in a consistent manner with and
underpinned by the same key assumptions as those described in the Group's 2025
Annual Report and Accounts, except for use of a pre-tax discount rate of 10.6
per cent (31 August 2025: 12.6 per cent) and updates required to reflect
market conditions, including what was known about the Middle East, as at the
balance sheet date. No impairment charge was recorded.
The recoverable amount currently exceeds the carrying value by £32m (31
August 2025: £36m) for the Rest of the World and Other segment and therefore
no impairment charge has been recorded. The recoverable amount and carrying
value would be equal, if, in isolation, with approximately one third of the
impact mitigated by lower variable costs, revenues were to miss forecasts in
each year of the initial forecast period and the terminal value year by one
per cent (31 August 2025: two per cent), or if headline EBITDA were to miss
forecasts by 11 per cent (31 August 2025: 13 per cent). These sensitivities
are deemed to be reasonably possible scenarios.
WH Smith PLC
Notes to the Condensed Interim Financial Statements
For the 6 months to 28 February 2025
12. Contingent liabilities and capital commitments
£m 28 Feb 2026 28 Feb 2025 31 Aug 2025
(unaudited) (unaudited) (audited)
Bank guarantees and guarantees in respect of contractual arrangements 74 73 76
Bank guarantees are principally in favour of landlords and could be drawn down
on by landlords in the event that the Group does not settle its contractual
obligations under lease or other agreements.
Contracts placed for future capital expenditure approved by the directors but
not provided for in these financial statements amount to £56m (28 February
20251: £97m; 31 August 2025: £66m).
(1)( ) Comparative periods have been restated to correct the previously
reported commitments
13. Related parties
Other than directors' remuneration, there have been no material related party
transactions during the interim period under review.
14. Events after the balance sheet date
Financing
On 10 March 2026 the first extension option on the term loan was exercised
taking the maturity date to the 24 March 2029. On the 11 March 2026, the US
private placements was fully drawn.
Statement of Directors' Responsibilities
The directors confirm that these Condensed Interim Financial Statements have
been prepared in accordance with UK adopted International Accounting Standard
34, 'Interim Financial Reporting' and the Disclosure Guidance and Transparency
Rules sourcebook of the United Kingdom's Financial Conduct Authority and that
the interim management report includes a fair review of the information
required by DTR 4.2.7 and DTR 4.2.8, namely:
• an indication of important events that have occurred during the
first six months and their impact on the condensed set of financial
statements, and a description of the principal risks and uncertainties for the
remaining six months of the financial year; and
• material related-party transactions in the first six months and
any material changes in the related-party transactions described in the last
annual report.
The Directors of WH Smith PLC are listed on the website at
www.whsmithplc.co.uk/about-us/our-board
(http://www.whsmithplc.co.uk/about-us/our-board) .
By order of the Board
Leo Quinn Max Izzard
Executive Chairman Chief Financial Officer
23 April 2026
Independent review report to WH Smith PLC
Report on the condensed consolidated interim financial statements
Our conclusion
We have reviewed WH Smith PLC's condensed consolidated interim financial
statements (the "interim financial statements") in the Interim Results
Announcement of WH Smith PLC for the 6 month period ended 28 February 2026
(the "period").
Based on our review, nothing has come to our attention that causes us to
believe that the interim financial statements are not prepared, in all
material respects, in accordance with UK adopted International Accounting
Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority.
The interim financial statements comprise:
* the Condensed Group Balance Sheet as at 28 February 2026;
* the Condensed Group Income Statement and Condensed Group Statement of
Comprehensive Income for the period then ended;
* the Condensed Group Cash Flow Statement for the period then ended;
* the Condensed Group Statement of Changes in Equity for the period then ended;
and
* the explanatory notes to the interim financial statements.
The interim financial statements included in the Interim Results Announcement
of WH Smith PLC have been prepared in accordance with UK adopted International
Accounting Standard 34, 'Interim Financial Reporting' and the Disclosure
Guidance and Transparency Rules sourcebook of the United Kingdom's Financial
Conduct Authority.
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, 'Review of Interim Financial Information Performed by
the Independent Auditor of the Entity' issued by the Financial Reporting
Council for use in the United Kingdom ("ISRE (UK) 2410"). A review of interim
financial information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures.
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and, consequently, does not
enable us to obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do not express
an audit opinion.
We have read the other information contained in the Interim Results
Announcement and considered whether it contains any apparent misstatements or
material inconsistencies with the information in the interim financial
statements.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on the review
procedures performed in accordance with ISRE (UK) 2410. However, future events
or conditions may cause the group to cease to continue as a going concern.
Responsibilities for the interim financial statements and the review
Our responsibilities and those of the directors
The Interim Results Announcement, including the interim financial statements,
is the responsibility of, and has been approved by the directors. The
directors are responsible for preparing the Interim Results Announcement in
accordance with the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority. In preparing the Interim
Results Announcement, including the interim financial statements, the
directors are responsible for assessing the group's ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the directors either intend
to liquidate the group or to cease operations, or have no realistic
alternative but to do so.
Independent review report to WH Smith PLC (continued)
Responsibilities for the interim financial statements and the review
(continued)
Our responsibilities and those of the directors (continued)
Our responsibility is to express a conclusion on the interim financial
statements in the Interim Results Announcement based on our review. Our
conclusion, including our Conclusions relating to going concern, is based on
procedures that are less extensive than audit procedures, as described in the
Basis for conclusion paragraph of this report.
Use of this report
This report, including the conclusion, has been prepared for and only for the
company for the purpose of complying with the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority and for no other purpose. We do not, in giving this conclusion,
accept or assume responsibility for any other purpose or to any other person
to whom this report is shown or into whose hands it may come save where
expressly agreed by our prior consent in writing.
PricewaterhouseCoopers LLP
Chartered Accountants
London
23 April 2026
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
Alternative performance measures
In reporting financial information, the Group presents alternative performance
measures, 'APMs', which are not defined or specified under the requirements of
IFRS. The Group believes that these APMs, which are not considered to be a
substitute for or superior to IFRS measures, provide stakeholders with
additional useful information on the underlying trends, performance and
position of the Group and are consistent with how business performance is
measured internally. The alternative performance measures are not defined by
IFRS and therefore may not be directly comparable with other companies'
alternative performance measures. Alternative performance measures reflect
continuing operations unless otherwise stated.
Non-underlying items
The Group has chosen to present a measure of profit and earnings per share
that excludes certain items, which are considered non-underlying and
exceptional due to their size, nature or incidence, or are not considered to
be part of the normal operations of the Group. The Group believes that the
separate disclosure of these items provides additional useful information to
users of the financial statements to enable a better understanding of the
Group's underlying financial performance.
Non-underlying items can include, but are not limited to, restructuring and
transformation costs linked to Board agreed programmes, costs relating to
M&A activity, impairment charges and other property costs, significant
items relating to pension schemes, amortisation of intangible assets acquired
in business combinations, and the related tax effect of these items. Reversals
associated with items previously reported as non-underlying, such as reversals
of impairments and releases of provisions or liabilities are also reported in
non-underlying items.
Items recognised in Other comprehensive income/loss may also be identified as
non-underlying for the purposes of narrative explanation of the Group's
performance, where the Group has determined that they are associated with the
above categories and are judged to have met the Group's definition of
non-underlying.
IFRS 16
The Group adopted IFRS 16 in the year to 31 August 2020. IFRS 16 superseded
the lease guidance under IAS 17 and the related interpretations. IFRS 16 sets
out the principles for the recognition, measurement, presentation and
disclosure of leases and requires lessees to account for all leases under a
single on-balance sheet model as the distinction between operating and finance
leases is removed. The only exceptions are short-term and low-value leases. At
the commencement date of a lease, a lessee will recognise a lease liability
for the future lease payments and an asset (right-of-use asset) representing
the right to use the underlying asset during the lease term. Lessees are
required to separately recognise the interest expense on the lease liability
and the depreciation expense on the right-of-use asset.
Management has chosen to exclude the effects of IFRS 16 for the purposes of
narrative commentary on the Group's performance and financial position in the
Strategic report. The effect of IFRS 16 on the Group income statement is to
frontload total lease expenses, being higher at the beginning of a lease
contract, and lower towards the end of a contract, and this is further
influenced by timing of renewals and contract wins, and lengths of contracts.
As a result of these complexities, IFRS 16 measures of profit and EBITDA (used
as a proxy for cash generation) do not provide meaningful KPIs or measures for
the purposes of assessing performance, concession quality or for trend
analysis, therefore management continues to use pre-IFRS 16 measures
internally.
The impact of the implementation of IFRS 16 on the Income statement and
Segmental information is provided in Notes A1 and A2 below. There is no impact
on cash flows, although the classification of cash flows has changed, with an
increase in net cash flows from operating activities being offset by a
decrease in net cash flows from financing activities, as set out in Note A9
below. The balance sheet as at 28 February 2026 both including and excluding
the impact of IFRS 16 is shown in Note A10 below.
Leases policies applicable prior to 1 September 2019
Leases are classified as finance leases whenever the terms of the lease
transfer substantially all the risks and rewards of ownership to the lessee.
All other leases are classified as operating leases. Assets held under finance
leases are recognised as assets of the Group at their fair value determined at
the inception of the lease or, if lower, at the present value of the minimum
lease payments. The corresponding liability to the lessor is included in the
balance sheet as a finance lease obligation. These assets are depreciated over
their expected useful lives on the same basis as owned assets or, where
shorter, over the term of the relevant lease. Lease payments are apportioned
between finance charges and a reduction of the lease obligations so as to
achieve a constant rate of interest on the remaining balance of the liability.
Finance charges are recognised directly in the income statement.
Rentals payable and receivable under operating leases are charged to the
income statement on a straight-line basis over the term of the relevant lease.
Benefits received and receivable as an incentive to enter into an operating
lease are also spread on a straight-line basis over the lease term. The Group
has a number of lease arrangements in which the rent payable is contingent on
revenue. Contingent rentals payable, based on store revenues, are accrued in
line with revenues generated.
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
Definitions and reconciliations
In line with the Guidelines on Alternative Performance Measures issued by the
European Securities and Markets Authority ('ESMA'), we have provided
additional information on the APMs used by the Group below, including full
reconciliations back to the closest equivalent statutory measure.
APM Closest equivalent IFRS measure Reconciling items to IFRS measure Definition and purpose
Income statement measures
Headline measures Various See Notes A1-A10 and A12-A14 Headline measures exclude the impact of IFRS 16 (applying the principles of
IAS 17). Reconciliations of all Headline measures are provided in Notes A1 to
A10 and A12 to A14.
Group profit before tax and non-underlying items Group profit before tax See Group income statement and Note A1 Group profit before tax and non-underlying items excludes the impact of
non-underlying items. A reconciliation from Group profit before tax and
non-underlying items to Group profit before tax is provided on the Group
income statement on page 18, and on a Headline (pre-IFRS 16) basis in Note A1.
Group profit from trading operations and segment trading profit Group operating profit See Note 2 and Note A2 Group profit from trading operations and segment trading profit are stated
after directly attributable share-based payment and pension service charges
and before non-underlying items, unallocated costs, finance costs and income
tax expense.
A reconciliation from the above measures to Group operating profit and Group
profit before tax on an IFRS 16 basis is provided in Note 2 to the financial
statements and on a Headline (pre-IFRS 16) basis in Note A2.
Non-underlying items None Refer to definition and see Note 3 and Note A6 Excludes items which are considered non-underlying and exceptional due to
their size, nature or incidence, or are not considered to be part of the
normal operations of the Group. The Group believes that the separate
disclosure of these items provides additional useful information to users of
the financial statements to enable a better understanding of the Group's
underlying financial performance. An explanation of the nature of the items
identified as non-underlying on an IFRS 16 basis is provided in Note 3 to the
financial statements, and on a Headline (pre-IFRS 16) basis in Note A6.
Earnings per share before non-underlying items Earnings per share Non-underlying items, see Note 7 and Note A4 Profit for the year attributable to the equity holders of the parent before
non-underlying items divided by the weighted average number of ordinary shares
in issue during the financial year. A reconciliation is provided on an IFRS 16
basis in Note 7 and on a Headline (pre-IFRS 16) basis in Note A4.
Headline EBITDA Group operating profit Refer to definition and Note A13 Headline EBITDA is Headline Group operating profit before non-underlying items
adjusted for pre-IFRS 16 depreciation, amortisation and impairment and before
non-cash items. See Note A13.
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
APM Closest equivalent IFRS measure Reconciling items to IFRS measure Definition and purpose
Income statement measures (continued)
Effective tax rate None Non-underlying items, see Note 3 and Notes A3 and A6 Total income tax charge excluding the tax impact of non-underlying items
divided by Group Headline profit before tax and non-underlying items. See Note
3 on an IFRS 16 basis, and Notes A3 and A6 on a pre-IFRS 16 basis.
Fixed charges cover None Refer to definition and Note A5 This performance measure calculates the number of times Headline EBITDA before
operating lease rentals stated on a pre-IFRS 16 basis covers the total fixed
charges included in calculating profit or loss. Fixed charges included in this
measure are net finance charges (excluding finance charges from IFRS 16
leases) and fixed operating lease rentals stated on a pre-IFRS 16 basis. The
calculation of this measure is outlined in Note A5.
Gross Gross profit margin Refer to definition Where referred to throughout the Preliminary announcement statement, gross
margin is calculated as gross profit divided by revenue.
margin
Like-for-like revenue Movement in revenue per the income statement - Revenue change from non like-for-like stores Like-for-like revenue is the change in revenue from stores that have been open
for at least a year, with a similar selling space at a constant foreign
- Foreign exchange impact exchange rate. See Note A11.
Balance sheet measures
Headline net debt Net debt Reconciliation of net debt, see Note 8 and Note A8 Headline net debt is defined as cash and cash equivalents, less bank
overdrafts and other borrowings and both current and non-current obligations
under finance leases as defined on a pre-IFRS 16 basis. Lease liabilities
recognised as a result of IFRS 16 are excluded from this measure. A
reconciliation of Net debt on an IFRS 16 basis provided in Note A8.
Other measures
Free cash flow Net cash inflow from operating activities See Note A7 and Group overview Free cash flow is defined as the net cash inflow from operating activities
before the cash flow effect of IFRS 16, non-underlying items and pension
funding, less net capital expenditure. The components of free cash flow are
shown in Note A7.
Return on capital employed (ROCE) None Refer to definition Return on Capital Employed is calculated as the Headline Group operating
profit as a percentage of operating capital employed and is stated on a
pre-IFRS 16 basis. Operating capital employed is calculated as the 12-month
average net assets, excluding net debt, retirement benefit obligations and net
current and deferred tax balances.
Leverage None Refer to definition and Note A14 Leverage is calculated as Headline net debt divided by rolling 12-month
Headline EBITDA (on a pre-IFRS 16 basis). See Note A14.
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
A1. Reconciliation of Headline to Statutory Group operating profit and Group
profit before tax
6 months to 28 Feb 2026
Pre-IFRS 16 Basis IFRS 16 Basis
£m Headline, before non-underlying items Headline non-underlying items Headline IFRS 16 adjustments IFRS 16 adjustments non-underlying items Total
Revenue 748 - 748 - - 748
Cost of sales (340) - (340) - - (340)
Gross profit - continuing operations 408 - 408 - - 408
Distribution costs (314) - (314) 9 - (305)
Administrative expenses (78) - (78) 1 - (77)
Other income 1 - 1 - - 1
Non-underlying items - (28) (28) - 1 (27)
Group operating profit/(loss) - continuing operations 17 (28) (11) 10 1 -
Finance costs (14) - (14) (11) - (25)
Profit/(loss) before tax - continuing operations 3 (28) (25) (1) 1 (25)
Income tax credit - 4 4 - - 4
Profit/(loss) for the period - continuing operations 3 (24) (21) (1) 1 (21)
Loss for the period - discontinued operations - (2) (2) - - (2)
Profit/(loss) for the period - total operations 3 (26) (23) (1) 1 (23)
Attributable to:
Equity holders of the parent (1) (26) (27) (1) 1 (27)
Non-controlling interests 4 - 4 - - 4
3 (26) (23) (1) 1 (23)
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
A1. Reconciliation of Headline to Statutory Group operating profit and Group
profit before tax (continued)
6 months to 28 Feb 2025 restated1
Pre-IFRS 16 Basis IFRS 16 Basis
£m Headline, before non-underlying items Headline non-underlying items Headline IFRS 16 adjustments IFRS 16 adjustments non-underlying items Total
Revenue 716 - 716 - - 716
Cost of sales (319) - (319) - - (319)
Gross profit - continuing operations 397 - 397 - - 397
Distribution costs (293) - (293) 4 - (289)
Administrative expenses (71) - (71) 1 - (70)
Other income - - - 1 - 1
Non-underlying items - (20) (20) - (1) (21)
Group operating profit/(loss) - continuing operations 33 (20) 13 6 (1) 18
Finance costs (12) - (12) (10) - (22)
Profit/(loss) before tax - continuing operations 21 (20) 1 (4) (1) (4)
Income tax (charge)/credit (4) 3 (1) - - (1)
Profit/(loss) for the period - continuing operations 17 (17) - (4) (1) (5)
Profit/(loss) for the period - discontinued operations 10 (45) (35) 3 (10) (42)
Profit/(loss) for the period - total operations 27 (62) (35) (1) (11) (47)
Attributable to:
Equity holders of the parent 25 (62) (37) (1) (11) (49)
Non-controlling interests 2 - 2 - - 2
27 (62) (35) (1) (11) (47)
(1)( ) Comparative periods have been restated a) to correct the
accelerated supplier income recognition and inventory-related items in the
North America division (refer to Note 1b for further details), totalling a
£10m reduction to previously reported cost of sales; b) to reclassify certain
costs amounting to £27m from distribution costs to cost of sales for
consistency with the current period; and c) to separately disclose results
from discontinued operations (refer to Note 1a for further details).
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
A2. Reconciliation of Headline to Statutory Segmental trading profit/(loss)
and Group profit from trading operations
6 months to 28 Feb 2026
Pre-IFRS 16 basis IFRS 16 basis
Headline, before non-underlying items Headline non-underlying items Headline IFRS 16 adjustments Total
UK 34 - 34 4 38
North America 2 - 2 7 9
Rest of the World and Other (4) - (4) (1) (5)
Group profit from trading operations- continuing operations 32 - 32 10 42
Unallocated central costs (15) - (15) - (15)
Group operating profit before non-underlying items - continuing operations 17 - 17 10 27
Non-underlying items - (28) (28) 1 (27)
Group operating profit/(loss) - continuing operations 17 (28) (11) 11 -
6 months to 28 Feb 2025 restated1
Pre-IFRS 16 basis IFRS 16 basis
£m Headline, before non-underlying items Headline non-underlying items Headline IFRS 16 adjustments Total
UK 40 - 40 - 40
North America 5 - 5 3 8
Rest of the World and Other 2 - 2 3 5
Group profit from trading operations- continuing operations 47 - 47 6 53
Unallocated central costs (14) - (14) - (14)
Group operating profit before non-underlying items - continuing operations 33 - 33 6 39
Non-underlying items - (20) (20) (1) (21)
Group operating profit/(loss) - continuing operations 33 (20) 13 5 18
(1)( ) Comparative periods have been restated to correct the accelerated
supplier income recognition and inventory related items in the North America
division (refer to Note 1b for further details) and to separately disclose
results from discontinued operations (refer to Note 1a for further details).
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
A3. Reconciliation of Headline to Statutory tax expense
6 months to 6 months to
28 Feb 2026 28 Feb 2025 restated1
£m Headline (pre-IFRS 16) IFRS 16 Total Headline (pre-IFRS 16) IFRS 16 adjustments Total
adjustments
Profit before tax and non-underlying items 3 (1) 2 21 (4) 17
Tax on profit - Standard rate of UK corporation tax 25% (28 February 2025: - - - 4 - 4
25%)
Tax charge on profit before non-underlying items - - - 4 - 4
Tax on non-underlying items - current tax (1) - (1) (2) - (2)
Tax on non-underlying items - deferred tax (3) - (3) (1) - (1)
Total tax (credit)/charge on (loss)/profit - continuing operations (4) - (4) 1 - 1
Total tax (credit)/charge on (loss)/profit - discontinued operations - - - (11) 5 (6)
Total tax (credit)/charge on (loss)/profit - total operations (4) - (4) (10) 5 (5)
( )
(1)( ) Comparative periods have been restated to correct the accelerated
supplier income recognition and inventory related items in the North America
division (refer to Note 1b for further details) and to separately disclose
results from discontinued operations (refer to Note 1a for further details).
A4. Calculation of Headline and Statutory earnings per share
6 months to 6 months to
28 Feb 2026
28 Feb 2025
millions Basic EPS Diluted EPS Basic EPS Diluted EPS
Weighted average number of shares in issue 125 126 128 130
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
A4. Calculation of Headline and Statutory earnings per share (continued)
6 months to 28 Feb 2026 6 months to 28 Feb 2025 restated1
Profit for the year attributable to equity holders of the parent Basic EPS Diluted EPS Profit for the year attributable to equity holders of the parent Basic EPS Diluted EPS
£m pence pence £m pence pence
Headline (pre-IFRS-16 basis)
- Before non-underlying items (1) (0.8) (0.8) 15 11.7 11.5
- Non-underlying items (24) (19.2) (19.2) (17) (13.3) (13.1)
- Continuing operations (25) (20.0) (20.0) (2) (1.6) (1.6)
- Discontinued operations (2) (1.6) (1.6) (35) (27.3) (27.3)
- Total operations (27) (21.6) (21.6) (37) (28.9) (28.9)
IFRS 16 adjustments
- Before non-underlying items (1) (0.8) (0.8) (4) (3.1) (3.0)
- Non-underlying items 1 0.8 0.8 (1) (0.8) (0.7)
- Impact of anti-dilutive potential shares - - - - - (0.2)
- Continuing operations - - - (5) (3.9) (3.9)
- Discontinued operations - - - (7) (5.5) (5.5)
- Total operations - - - (12) (9.4) (9.4)
IFRS 16 basis
- Before non-underlying items (2) (1.6) (1.6) 11 8.6 8.5
- Non-underlying items (23) (18.4) (18.4) (18) (14.1) (13.8)
- Impact of anti-dilutive potential shares - - - - - (0.2)
- Continuing operations (25) (20.0) (20.0) (7) (5.5) (5.5)
- Discontinued operations (2) (1.6) (1.6) (42) (32.8) (32.8)
- Total operations (27) (21.6) (21.6) (49) (38.3) (38.3)
(1)( ) Comparative periods have been restated to correct the accelerated
supplier income recognition and inventory related items in the North America
division (refer to Note 1b for further details) and to separately disclose
results from discontinued operations (refer to Note 1a for further details).
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
A5. Fixed charges cover
£m Note 12 months to 28 Feb 2026
Headline net finance costs before non-underlying items for 6 months to 28 Feb A1 14
2026
Headline net finance costs before non-underlying items for 6 months to 31 Aug 14
2025
Headline fixed operating lease charges for 6 months to 28 Feb 2026 (pre-IFRS A12 131
16)
Headline fixed operating lease charges for 6 months to 31 Aug 2025 (pre-IFRS 121
16)
Total fixed charges 280
Headline EBITDA for 12 months to 28 Feb 2026 A13 173
Headline fixed operating lease charges for 6 months to 28 Feb 2026 (pre-IFRS A12 131
16)
Headline fixed operating lease charges for 6 months to 31 Aug 2025 (pre-IFRS 121
16)
Headline EBITDA before headline fixed operating lease charges and 425
non-underlying items (pre-IFRS 16) - continuing operations
Fixed charges cover - times - continuing operations 1.5x
(1)( ) Comparative periods have been restated to correct the accelerated
supplier income recognition and inventory related items in the North America
division (refer to Note 1b for further details) and to separately disclose
results from discontinued operations (refer to Note 1a for further details).
( )
A6. Non-underlying items on pre-IFRS 16 and IFRS 16 bases
6 months to 28 Feb 2026 6 months to 28 Feb 2025 restated1
£m Headline (pre-IFRS16) IFRS 16 Headline IFRS 16
(pre-IFRS16)
Amortisation of acquired intangible assets 1 1 2 2
Impairment of non-current assets
- property, plant and equipment 10 11 5 5
- intangible assets 1 1 - -
- right-of-use assets - 4 - 1
Provisions for onerous contracts 4 - 1 1
Transformation programmes - IT 4 4 3 3
Transformation programmes - supply chain - - 2 2
Transformation programmes - operational efficiencies 2 2 7 7
Costs associated with the investigation into accelerated recognition of 3 3 - -
supplier income in North America
Impairment of other receivables 2 2 - -
IFRS 16 remeasurement gains - (2) - -
Other non-underlying costs 1 1 - -
Non-underlying items, before tax - continuing operations 28 27 20 21
Tax credit on non-underlying items (4) (4) (3) (3)
Non-underlying items, after tax - continuing operations 24 23 17 18
(1)( ) Comparative periods have been restated to separately disclose
results from discontinued operations (refer to Note 1a for further details).
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
A6. Non-underlying items on pre-IFRS 16 and IFRS 16 bases (continued)
Non-underlying items on a pre-IFRS 16 basis are calculated on a consistent
basis with IFRS 16, with the exception of the below items.
Impairment of right-of-use assets and IFRS 16 remeasurement gains
On a pre-IFRS 16 basis right-of-use assets are not recognised, therefore the
right-of-use asset impairment of £4m (28 February 2025: £1m) and IFRS 16
remeasurement gains of £2m (28 February 2025: £nil) are also not recognised.
Provisions for onerous contracts
A charge of £4m (28 February 2025: £1m) has been recognised on a pre-IFRS 16
basis to provide for the unavoidable costs of continuing to service certain
non-cancellable supplier and property contracts where the space is vacant, a
contract is loss-making or currently not planned to be used for ongoing
operations. On an IFRS 16 basis there is a £nil charge, as the pre-IFRS 16
charge is replaced by impairments to right-of-use assets that are not
recognised on a pre-IFRS 16 basis.
A tax credit of £4m (28 February 2025: £3m) has been recognised in relation
to the above items (£4m pre-IFRS 16 (28 February 2025: £3m)).
A7. Free cash flow
£m 6 months to 28 Feb 2026 6 months to 28 Feb 2025 restated1
Net cash inflow from operating activities - continuing operations 6 65
Cash flow impact of IFRS 16 (Note A9) (39) (41)
Add back:
- Cash impact of non-underlying items 22 18
Deduct:
- Purchase of property, plant and equipment (incl. £nil (46) (38)
non-underlying capital expenditure (28 February 2025: £1m))
- Purchase of intangible assets (4) (1)
- Pension funding - (75)
Free cash flow - continuing operations (61) (72)
Free cash flow - discontinued operations - 3
Free cash flow - total operations (61) (69)
(1)Comparative periods have been restated to separately disclose results from
discontinued operations (refer to Note 1a for further details).
A8. Headline net debt
The table below shows Headline net debt (pre-IFRS 16). This excludes lease
liabilities recognised on application of IFRS 16.
£m Note At At At
28 Feb 2026
28 Feb 2025 31 Aug 2025
Borrowings
- Revolving credit facility (219) (178) (141)
- Convertible bonds (325) (315) (320)
- Lease liabilities (514) (601) (484)
Liabilities from financing activities (1,058) (1,094) (945)
Cash and cash equivalents 48 39 71
Net debt (IFRS 16) 8 (1,010) (1,055) (874)
- Add back lease liabilities recognised under IFRS 16 514 601 484
Net debt (pre-IFRS 16) (496) (454) (390)
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
A9. Cash flow disclosure impact of IFRS 16
There is no impact of IFRS 16 on cash flows, although the classification of
cash flows has changed, with an increase in net cash flows from operating
activities being offset by a decrease in net cash flows from financing
activities.
6 months to 28 Feb 2026 6 months to 28 Feb 2025 restated1
£m Headline (pre-IFRS 16) IFRS 16 Headline (pre-IFRS 16) IFRS 16
IFRS 16 Adjustment IFRS 16 Adjustment(2)
Net cash (outflow)/inflow from operating activities (43) 39 (4) 32 60 92
Net cash outflow from investing activities (47) - (47) (54) - (54)
Net cash inflow/(outflow) from financing activities 67 (39) 28 5 (60) (55)
Net decrease in cash in the period (23) - (23) (17) - (17)
(1) Comparative periods have been restated to reclassify the settlement of
financial instruments from Operating activities to Investing activities
(2) Comprises £41m related to continuing operations and £19m related to
discontinued operations
A10. Balance sheet impact of IFRS 16
The balance sheet including and excluding the impact of IFRS 16 is shown
below:
At 28 Feb 2026 At 28 Feb 2025 restated1
Headline (pre-IFRS 16) IFRS 16 Headline (pre-IFRS 16) IFRS 16
IFRS 16 Adjustment IFRS 16 Adjustment
£m
Goodwill and other intangible assets 446 (1) 445 490 (2) 488
Property, plant and equipment 265 2 267 313 8 321
Right-of-use assets - 393 393 - 467 467
Investments in joint ventures 2 - 2 2 - 2
Non-current investments 2 - 2 10 - 10
715 394 1,109 815 473 1,288
Inventories 140 - 140 212 - 212
Payables less receivables (103) (6) (109) (128) (13) (141)
Working capital 37 (6) 31 84 (13) 71
Net current and deferred tax assets 30 1 31 62 - 62
Net derivative financial liability (1) - (1) - - -
Provisions (23) 23 - (30) 13 (17)
Operating assets employed 758 412 1,170 931 473 1,404
Net debt (496) (514) (1,010) (454) (601) (1,055)
Net assets excluding retirement benefit surplus 262 (102) 160 477 (128) 349
Retirement benefit surplus 1 - 1 - - -
Total net assets 263 (102) 161 477 (128) 349
(1)( ) Comparative periods have been restated in accordance with the items
set out in Note 1b.
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
A11. Like-for-like revenue reconciliation
The reconciling items between like-for-like revenue change and total revenue
change are shown below:
UK North America Rest of the World and Other Total Group - continuing operations
Per cent
Like-for-like revenue change 2 1 6 2
Net space impact - 3 - 2
Foreign exchange - 1 4 1
Total revenue change 2 5 10 5
A12. Operating lease expense
Amounts recognised in Headline Group operating profit on a pre-IFRS 16 basis
are as follows:
£m 6 months to 28 Feb 2026 6 months to 28 Feb 2025 restated1
Fixed charges 131 111
Variable charges 37 43
Net operating lease charges - continuing operations 168 154
(1)Comparative periods have been restated to separately disclose results from
discontinued operations (refer to Note 1a for further details).
In the year to 31 August 2020, the Group adopted IFRS 16. IFRS 16 requires
lessees to account for all leases under a single on-balance sheet model as the
distinction between operating and finance leases is removed. In order to
provide comparable information the Group has chosen to present Headline
measures of operating profit and profit before tax, as explained in Note 2
segmental analysis.
The table above presents the pre-IFRS 16 net operating lease charges, applying
the principles of IAS 17, and Group accounting policies as applicable prior to
1 September 2019, as described in the Glossary on page 48.
The Group leases various properties under non-cancellable operating lease
agreements. The leases have varying terms, escalation clauses and renewal
rights. The Group has a number of lease arrangements in which the rent payable
is contingent on revenue. Contingent rentals payable, based on store revenues,
are accrued in line with revenues generated. The average remaining lease
length across the Group is five years.
Rentals payable and receivable under operating leases are charged to the
income statement on a straight-line basis over the term of the relevant lease.
Benefits received and receivable as an incentive to enter into an operating
lease are also spread on a straight-line basis over the lease term.
A13. Headline EBITDA
£m 12 months to 28 Feb 2026
Group operating profit (Note A1) - continuing operations 17
Depreciation, amortisation and impairment (Note 2c) 27
Non-cash items 4
Headline EBITDA for 6 months to 28 Feb 2026 - continuing operations 48
Headline EBITDA for 6 months to 31 Aug 2025 - continuing operations(1) 125
Total Headline EBITDA for 12 months to 28 Feb 2026 - continuing operations 173
(1)( ) Includes non-cash items of £(2)m.
WH Smith PLC
Glossary (unaudited)
For the 6 months to 28 February 2026
A14. Leverage
£m Note 6 months to 28 Feb 2026
Total Headline EBITDA for 12 months to 28 Feb 2026 A13 173
Headline net debt A8 496
Leverage - multiple - continuing operations 2.9x
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