Post Year-End Trading Update · RNS 6464W · 29 September 2026
Smiths News expects FY2026 profit ahead of expectations after record World Cup boost
Share price
82.16p
Market cap
£203m
52-week range
0.74p – 86p
Shares in issue
247.7m
12-month change
+36.6%
Ticker Data API, as at 3 Nov 2026, 16:28
Share price, 12 months
Summary
Smiths News said today that it expects results for the year to 29 August 2026 to be ahead of market expectations, with adjusted operating profit consensus at £37.2m. A record contribution of over £3m from the Men's FIFA World Cup lifted collectables in the second half. FY2027 has started positively, and work has begun on a national distribution network to serve the new publisher contracts, with the first go-live in July 2027. The company gave no revised profit figure and deferred guidance on the cost of the expansion to its 4 November results. The beat clears a bar set below FY2025's £39.1m, and the tournament effect will not recur next year. The investment case now turns on what the network build costs and how it is funded.
Sources: Post Year-End Trading Update RNS, 29 Sep 2026; Preliminary Results, 4 Nov 2025; Interim Results, 6 May 2026; Contract Win - National Distribution RNS, 17 Jun 2026; Statement re Tuffnells Parcels Express Pension RNS, 23 Feb 2026; Balance sheet (tagged accounts), 2025-08-30
The announcement
FY2026 results are now expected to be ahead of market expectations. Company-compiled consensus for adjusted operating profit is £37.2m, but no revised figure was given.
Second-half demand for collectables was stronger than expected, including a record Men's FIFA World Cup contribution of over £3m. The company notes that international football tournaments typically boost performance in alternate years.
FY2027 trading has started positively. The company has begun a 'transformational programme' to build a national distribution footprint for the contract wins announced in H2 FY2026, ahead of the first go-live in July 2027.
Guidance on the financial effects of the network expansion will be given with the FY2026 results on Wednesday 4 November 2026.
The chief executive cited the national contract awards with News UK, Associated Newspapers, Frontline and Seymour, and growth areas such as recycling, as positioning the group for growth.
Against guidance
Smiths News had said FY2026 trading was in line with market expectations in November 2025, January 2026 and May 2026. It now expects results ahead of the £37.2m adjusted operating profit consensus. With H1 adjusted operating profit of £18.3m, the second half needed only a little over £18.9m to beat that figure. The consensus itself sits below the £39.1m delivered in FY2025, so a beat could still mean flat or lower profit year on year. The company flagged FY2025 as 'slightly ahead' in September 2025 and then delivered, which lends the statement credibility. Ticker's earnings surprise model, an estimate, had only narrowly favoured an 'ahead' outcome.
Bull case
Management has a record of flagging and then delivering modest beats. The upgrade confirms FY2026 resilience, and FY2027 has started positively.
The national contracts extend the revenue base to 2037. They bring uplifts of approximately £125m a year from July 2027 (News UK), approximately £105m from January 2028 (Associated Newspapers) and approximately £105m from April 2030 (Frontline and Seymour).
Cash generation has been strong. FY2025 operating cash flow was £49.4m against £28.3m profit after tax, and company-defined free cash flow was £36.1m. The dividend is guided at or above 5.2p for FY2026 and FY2027.
Brokers remain positive: Canaccord Genuity has a 95p target and Berenberg 85p. On an optimistic view, the dense early-morning network could support growth in recycling and final-mile services.
Bear case
The over £3m World Cup contribution is a tournament effect that will not recur in FY2027. Excluding it, the core business is still declining: H1 revenue fell to £515.7m from £536m and adjusted operating profit fell to £18.3m from £19.4m.
The cost of the national build is unquantified. One-off implementation costs are expected during FY2027, while most of the new revenue starts in 2028 and 2030. The contract figures are revenue, not profit.
The balance sheet is thin. FY2025 equity was £9.50m and current liabilities of £133m exceeded current assets of £125m. H1 bank net cash was £7.8m, against a possible Tuffnells pension claim estimated at £3,467,000.
The backdrop is unhelpful for a delivery network. Brent crude is at $104.32 after a 44.9% three-month rise and CPIH inflation is 3.10%. The wider footprint could also dilute route density.
What to watch
The 4 November FY2026 results: the size and timing of implementation costs, capital spending and working-capital needs for the national build, plus facility and covenant headroom.
A breakdown separating the World Cup contribution from underlying profit, and whether the new contracts let fuel and wage increases be passed on to customers.
Whether the dividend commitment of at least 5.2p is reaffirmed with forecast cash cover after the build.
The outcome of the Pensions Regulator's consideration of a Financial Support Direction over the Tuffnells scheme.
This research is produced by Ticker using automated analysis of company announcements, filings and market data. It is for information only, is not personal advice or a recommendation to buy or sell any security, and may contain errors. Past performance is not a reliable indicator of future results. The value of investments can fall as well as rise. Market data from Ticker's Data API as at 3 Nov 2026, 16:28.