WH Smith PLC (LSE:SMWH) shares fell 6% despite the retail chain reporting final results in line with expectations, topping up its dividend and saying trading had "started well" in the new year.
The high streets, airports and stations retailer said it plans a "a year of investment" in its Funky Pigeon online greeting cards platform, with higher levels of spend on the platform and brand than in 2024.
Analysts at Peel Hunt there "may be a small downgrade" in consensus profit forecasts today, even though the larger investment into Funky Pigeon "should not have an immediate impact". Currently, City analysts forecast profit before tax in the coming year of £182 million.
Results for the past year to 31 August had largely been pre-announced, with group revenue up 7% to £1.9 billion and underlying PBT up 16% to £166 million, bang in line with the consensus forecast.
The company plans to open 90 new stores in the current year, with 60 in North America.
Chief executive Carl Cowling hailed the Travel division winning "significant" new airport retail space, including in Dallas, Denver and Washington Dulles airports, and being the preferred bidder for a further 15 stores across two major US airports.
"We are making excellent progress in the UK as we continue to benefit from the rollout of our one-stop-shop format which is creating significant opportunities to further grow profitability," he said, though the US is the "most exciting opportunity for growth".
On top of a £50 million share buyback announced in September, a final dividend of 22.6p was proposed today, making a total of 33.6p for the year, up from 28.9p a year ago.
"The new financial year has started well," Cowling said. "While there is some economic uncertainty, we are confident that 2025 will be another year of good progress for the group."