Interactive Investor

ii view: WH Smith pushes travel related growth

Looking to invest a further £140 million to drive growth in 2024. We assess prospects for this FTSE 250 specialist retailer.

8th December 2023 15:37

by Keith Bowman from interactive investor

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Full-year results to 31 August

  • Revenue up 28% to £1.79 billion
  • Adjusted pre-tax profit up 96% to £143 million
  • Final dividend of 20.8p per share, up from 9.1p per share last year
  • Headline net debt of £330 million, up from £296 million

Chief executive Carl Cowling said:

"Our global travel business is growing in all our key markets. It is highly scalable with multiple medium and long term growth opportunities and we are seeing great results from sharing our expertise and innovation across our different geographies.

“We have started the new financial year well with total revenue in Travel UK up 13%, North America up 15%, and Rest of the World up 27%. With good trading and very positive prospects, despite the uncertainty in the economic environment, we are confident in the Group's outlook for the new financial year."

ii round-up:

WH Smith (LSE:SMWH) is a retailer selling newspapers, books, and other convenience products. 

It operates through the two divisions of Travel related stores both in the UK and overseas and UK High Street outlets. 

Other brands include its InMotion branded technology related stores, often sat aside its Travel related stores at airports both in the UK and internationally, and its online stores and Cult Pens.  

For a round-up of this latest trading update announced on 9 November, please click here

ii view:

A retailer of newspapers, books, and other convenience products such as sandwiches and drinks, WH Smith operates more than 1,700 stores and a series of websites. Most of its outlets are now travel related, located at airports, railway stations and motorway service stations in the UK and overseas, with just over 500 making up its UK high street division. 

Other group brands include its InMotion branded technology related stores, often sat aside its Travel related stores at airports both in the UK and internationally, and its online stores, Cult Pens, Tree of hearts and Dotty about paper. 

For investors, the tough economic backdrop including heightened mortgage and rental costs for its customers is not be ignored. Profit for its high street division stayed flat year-over-year. Technological advances now offer alternatives to travel such as zoom meetings with newspapers and books now generally available online. Other businesses such as Greggs (LSE:GRG) are competing hard in the arena of food at places such as train stations, while currency headwinds warrant consideration given its growing overseas operations. 

On the upside, new stores and largely overseas are being opened and including 60 new North American travel stores for the year ahead. A diversity of both product type and geographical location exists. Travel related sales and including those in the UK rose 43% year-over-year to £1.32 billion with like-for-like airport sales leading the way up 37%. Costs and its product categories are an ongoing management focus, while the dividend payment was previously restarted following its suspension under the pandemic with the shares now sat on an estimated future dividend yield of over 2.5%. 

For now, and given an ongoing store opening programme and a consensus analyst estimate of fair value stood at over £17 per share, long-term fans of this specialist retailer are likely to remain sitting tight. 


  • Product and geographical diversity
  • Growing store numbers


  • Uncertain economic outlook
  • Overseas ops bring currency volatility 

The average rating of stock market analysts:


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