WH Smith to raise £100m as it warns on profits due to Iran war
Summary
WH Smith warned that profits will be lower this year because fewer people are shopping at its airport stores due to the war in the Middle East. The company plans to raise around £100 million by selling new shares to reduce debt, invest in technology, and close unprofitable stores.Key Facts
- WH Smith operates 1,200 stores worldwide in airports, train stations, and hospitals.
- Airport store revenues in North America dropped 2% in the seven weeks to June 6.
- The company expects pre-tax profits between £75 million and £90 million, down from earlier estimates of £90 million to £105 million.
- Total revenues across the business grew by 1% year on year during the same period.
- WH Smith plans to raise £100 million by issuing about 26 million new shares.
- The company will take a £150 million non-cash impairment charge after reviewing the business.
- WH Smith will close some stores in Europe and North American resorts and may replace some operations with franchises.
- CEO Leo Quinn described the situation as difficult due to economic uncertainty affecting consumer spending.
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