SMITHS NEWS PLC - Half Year Results

Smiths News PLC delivered a resilient H1 2026 performance, with management reaffirming full-year guidance in line with market expectations despite ongoing structural declines in print media. The company reported adjusted operating profit of £18.3m and adjusted profit after tax of £12.7m, supported by strong cash generation, with free cash flow rising to £21.2m and average net cash improving to £16.2m. Revenue declined 3.9%, consistent with guidance, as the core newspaper and magazine distribution business continued to track historic market trends while benefiting from long-term contract visibility, with 96% of revenues secured through 2029 or beyond. Growth strategy execution remained a key highlight, with collectibles revenue increasing 13.3% driven by strong demand for Pokémon and upcoming FIFA World Cup trading collections, while growth vertical revenues rose 35%, including over 50% growth in recycling services. Smiths News also highlighted strategic opportunities in the UK Deposit Return Scheme (DRS), final-mile logistics, book distribution and recycling solutions, leveraging its nationwide supply chain infrastructure and extensive retailer network. Management expects continued operational efficiencies exceeding £4m in FY2026, alongside further momentum across growth verticals, positioning the business for sustainable cash generation, improved shareholder returns and long-term revenue diversification.