In a blow to the renowned British retailer, WH Smith has found itself under the scrutiny of the UK’s financial regulator, the Financial Conduct Authority (FCA), following the discovery of accounting errors within its North American operations earlier this year.
The FCA has launched an investigation to determine whether WH Smith breached rules regarding the disclosure of information to investors. This development comes as the company has been forced to delay the release of its annual results, initially due on 12 November, not once but twice.
The accounting issues have had a significant impact on the company, leading to the resignation of its chief executive, Carl Cowling, and a 40% drop in its share price. In a bid to address the situation, WH Smith has announced plans to recover “overpaid” bonuses awarded to some executives last year.
Andrew Harrison, the company’s interim group chief executive, acknowledged the challenges, stating, “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.”
The retailer, which has a long-standing presence on Britain’s high streets, has undergone a significant restructuring in recent times. Earlier this year, it sold off its chain of 480 High Street shops, which have since been rebranded as TG Jones under new ownership.
The remaining part of the business, comprising around 1,300 branches in railway