WH Smith probed by regulator over accounting error

WH Smith is being investigated by the UK's financial regulator after the retailer uncovered accounting mistakes at its North America business earlier this year

The Financial Conduct Authority (FCA) said it was looking at whether WH Smith had broken rules over what information was shared with investors.

Belatedly announcing its annual results, the company said it was planning to recover "overpaid" bonuses awarded last year to some executives.

WH Smith, which has lost its chief executive and seen its shares fall 40% following the accounting blunder, said it had been a difficult end to the year.

WH Smith sold off its chain of 480 High Street shops earlier this year, and these stores have been rebranded TG Jones by its new owner.

The retained part of the business includes about 1,300 branches in railway stations, airports and other transport sites.

Pre-tax profit excluding one-off costs for the slimmed down business was £108m for the year to the end of August, WH Smith said.

Forecasts for its profit had been downgraded after it surfaced that WH Smith's business in North America had overstated revenues possibly by as much as £50m.

The company delayed reporting its annual results, initially due on 12 November, twice and chief executive Carl Cowling resigned following an independent review into the accounting errors.

"It has been a difficult end to the year for the group. The board and I are acutely aware that we have much to do to rebuild confidence in WH Smith and deliver stronger returns," said Andrew Harrison, the company's interim group chief executive.

He said the company was "committed to ensuring that we strengthen our financial controls and governance as we move forward."

It said it planned to overhaul its stores in 2026 to create "one-stop-shops" selling travel essentials, food-to-go and health and beauty products.