JB Hi-Fi has defied the Australian retail crunch with record half year profits

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Consumer electronics chain JB Hi-Fi today shrugged off a weak environment for retailers, posting a record half year underlying profit after tax of $125.4 million, a 31.7% increase.

JB Hi-Fi shares jumped more than 6% to $$30.21 in early trade.

The result was fuelled by a 23.6% jump in sales to $2.6 billion for the six months to December. The statutory profit was up almost 16% to $110.4 million.

And there’s more to come. The company forecasts underlying net profit for the full year of between $200 million and $206 million, an increase of 31.4% to 35.4%.

While others have been reporting a disappointing Christmas and New Year, JB Hi-Fi says total sales growth was 9.8% in January with like for like sales at 7.2%.

JB Hi-Fi is a beacon of sales records in a troubled retailing sector with a string of players going into administration or liquidation.

Last week fashion clothing brands Herringbone and Rhodes & Beckett went into voluntary administration. They are the latest, under pressure from online trading and emerging competitors, going into administration, including Payless Shoes, Pumkin Patch, Howards Storage World and Dick Smith stores, which closed last year.

“We are pleased to have delivered record sales and earnings results for the half,” says JB Hi-Fi CEO Richard Murray.

“It has been a particularly strong 12 months for the JB Hi-Fi business in Australia.”

The year included the $870 million acquisition in November of home appliance chain The Good Guys, taking the total JB Hi-FI network to 295 stores across Australia and New Zealand.

“Having successfully completed our acquisition of The Good Guys, the group is well positioned to build on its solid momentum into the second half,” says Murray.

He says group sales will be about $5.58 billion for the full year, $4.33 billion from JB Hi-Fi and $1.25 billion from The Good Guys $1.25 billion.

In Australia, sales grew by 11.7% to $2.2 billion, with comparable sales up 8.7%.

Key growth categories were the communications, audio, cameras, accessories, computers and home appliance categories.

Online sales grew 40.4% to $84.8 million, or 3.8% of total sales.

The company declared a fully franked interim dividend of 72 cents share, up 14.3%.

The results at a glance:

Source: JB Hi-Fi

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