The newspapers, books and stationery retailer, said the return of cash would be through a share buyback programme.
WH Smith made an underlying pre-tax profit of £89m in the year to 31 August.
That compares with analysts' consensus forecast of £87m, according to a company poll, and £82m made in 2008-09.
The group, which trades from high street stores and a travel division with outlets at airports, train stations, hospitals, motorway service stations and work places, said total sales fell two percent, while sales at stores open over a year fell four per cent.
Chief executive Kate Swann's strategy is based on cutting costs and improving gross margins by focussing on more profitable products, better sourcing and better control of markdowns, rather than driving top-line sales.
She has rebalanced WH Smith's mix of products towards core categories and away from entertainment products including CDs, DVDs, computer games and consoles.
"We are a resilient business with a strong and consistent record of both profit growth and cash generation and are well-positioned for continued growth in the future," said Swann.
The final dividend is 13.3 pence, making 19.4 pence for the full year, up 16 per cent.
Shares in WH Smith closed at 454.9 pence on Wednesday, valuing the business at £685m.