WH Smith raises £100m buffer as Iran war hits airport trading

WH Smith has issued a profit warning after numbers shopping at its stores in US airports fell as a result of the war in the Middle East, prompting the company to raise fresh capital from investors.

- Mark Sweney

The retailer, which operates 1,200 outlets globally in airports, railway stations and hospitals, raised £102m through a share sale yesterday to strengthen its balance sheet, pay down debt, invest in technology and close unprofitable stores following “a downturn in trading conditions”.

WH Smith, which had already seen revenue falls in its UK airport operation due to the conflict, said North America had now also been affected, with revenues at its airport operations falling 2% year on year in the seven weeks to 6 June.

As a result, the company expected pre-tax profits of between £75m and £90m this year, down from previous guidance of between £90m and £105m. It said: “Management’s expectations for the full financial year reflect the observed and anticipated decline in passenger numbers and weakening consumer demand across all divisions and a reduction in brand marketing, increased promotional activity and inflation headwinds across the group.