Smiths News posts strong FY 2024 results, exceeding market expectations

Leading news wholesaler Smiths News has reported robust financial performance for its 2024 financial year, with revenue growth, enhanced operational efficiencies, and a revised dividend strategy benefiting shareholders.

In the 53 weeks ending 31 August 2024, Smiths News posted revenues of £1.104 billion, a 1.1 per cent increase from the previous year, and an adjusted operating profit of £39.1 million, supported by sales from the UEFA European Championships and an extra trading week.

The company delivered cost savings of £5.6m through streamlined operations and secured 91 per cent of its revenue from publisher contracts extending to 2029, providing long-term stability.

“Our performance over FY 2024 reflects the resilience of our news and magazines business and impact of our cost efficiency initiatives,” chief executive Jonathan Bunting said.

“Our growth programme is centred around Smiths News’s asset-light, flexible cost base and our established competencies across reverse logistics, warehousing and early morning final mile services. These position us well to drive profitability from complementary market opportunities in growth areas such as recycling, final mile and warehousing verticals.”

The company’s improved capital position, partly due to a May 2024 refinancing, led to a reduction in average bank net debt by 53 per cent to £11.7m. This refinancing enabled Smiths News to revise its capital allocation policy, unlocking greater flexibility for shareholder distributions. The proposed final dividend of 3.4 pence per share, along with a special dividend of 2.0 pence per share, brings total dividends to 7.15 pence per share for FY 2024, a 72 per cent increase from the previous year.

Bunting highlighted that the company’s growth initiatives are already delivering positive results, with contributions from organic growth increasing to £2m from £0.7m in FY 2023. New programmes, including Smiths News Recycle, align with Smiths News’ strategy to leverage its extensive UK delivery network and expand its presence in complementary logistics services.

With a solid start to the current fiscal year, the company said it remains on track to meet market expectations and continue delivering shareholder value.

“The combination of the recently announced investment programme and dividend policy demonstrates our ability to meet the ongoing needs of the business while providing attractive cash returns to shareholders,” Bunting added.