JB Hi-Fi shares are tanking after a profit downgrade

Daniel Bockwoldt/AFP/Getty Images

Shares in JB Hi-Fi fell hard after the costumer electronics retail downgraded its full year earnings forecast.

A short time ago, they were down 7% to $23.77.

In a trading update, the company says it now expects full year net profit after tax to be about $230 million, down from previous guidance given in February of $235 million to $240 million.

“Whilst the challenging conditions in the home appliance market are expected to impact performance in the short term, we remain confident in the group model and the medium and long term outlook for The Good Guys and JB Hi-Fi,” the company says.

The company says the JB Hi-Fi business continues to perform strongly and in line with expectations.

However, the Good Guys performance has been impacted by “challenging conditions” due to unfavourable weather conditions coupled with heightened price competition.

JB Hi-Fi has been a stand out performaner among bricks and mortar retailers, most of whom are suffering from digital competition and weak costumer confidence.

Revenue in the first half to December was up 41% to a record $3.69 billion. Statutory profit after tax was up 37.4% to $151.7 million.

Among retail stocks today, Harvey Norman was down 3.4% to $3.40 and Myer 1.1% to $0.425.

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