• Swindon & Wiltshire Economy
• Thursday April 23 2026

Thanks Donald – WH Smith cuts outlook amid weaker passenger spending

WH Smith has suspended its dividend and warned of weaker profits, as geopolitical disruption and slowing passenger spending weigh on the travel retail sector.

The Swindon-headquartered FTSE 250 group said on Thursday it would halt shareholder payouts in a move aimed at preserving cash and strengthening its balance sheet, citing a more uncertain outlook for the year ahead.

The decision comes alongside a downgrade to profit expectations and reflects mounting pressure on the company’s core airport and travel hub operations.

The retailer, which operates more than 1,200 stores globally across airports, railway stations and hospitals, said it was taking a “cautious outlook” following disruption linked to conflict in the Middle East.

The crisis has led to reduced passenger numbers, flight cancellations and higher costs across the aviation sector, all of which are feeding through to lower footfall and weaker consumer spending.

WH Smith said the dividend suspension would support efforts to reduce debt and improve financial resilience during a period of heightened volatility.

The company added that it would look to reinstate shareholder returns once excess cash becomes available, signalling that the move is intended as a temporary but necessary step.

Financial results published alongside the announcement showed that while revenues rose 5% to £748 million in the first half, profitability came under significant pressure.

Headline profit before tax fell sharply to £3 million, down from £21 million a year earlier, reflecting inflationary headwinds, operational disruption and softer demand in key markets.

The group also lowered its full-year profit guidance to between £90 million and £105 million, compared with previous expectations of up to £115 million.

Analysts said the downgrade and dividend suspension were likely to weigh on investor sentiment in the near term.

Shares in WH Smith fell sharply following the update, dropping as much as 17 per cent in early trading before recovering slightly, as markets reacted to the deteriorating outlook for global travel demand.

The latest developments add to a challenging period for the company, which has been restructuring its business to focus on travel retail while also dealing with legacy issues in its North American division.

Despite the near-term headwinds, management said it remains confident in the long-term fundamentals of the business, particularly its exposure to high-footfall travel locations.

However, much will depend on the recovery of international travel demand and consumer confidence in the months ahead.