WH Smith Issues Profit Warning and Plans £100m Share Issue
WH Smith lowered its full-year profit forecast after revenues at its airport stores in the United States and United Kingdom declined. The company will raise about £100m through a share issue and close some underperforming locations.
news.sky.comWH Smith lowered its expected pre-tax profit range for the current financial year to between £75m and £90m after passenger numbers fell at its airport stores. The company previously guided for profits between £90m and £105m.
Smith said it will raise about £100m by issuing roughly 26m new shares. The proceeds will be used to strengthen the balance sheet, reduce debt, invest in technology and close unprofitable stores. The retailer will also record a £150m non-cash impairment charge this year. It plans to shut some stores in Europe and at resorts in North America.
The company’s executive chair said it is starting a programme to sell, exit or renegotiate loss-making operations and replace some directly run stores with franchises. WH Smith added that it will continue to invest in its core business to improve productivity. Shares in the company fell 15% in early trading on Wednesday to 416p.
