JB Hi-Fi defies the tough Australian retail market, lifting profit 35%

People shop in a JB Hi-Fi store. Photo: Scott Barbour/ Getty Images.

Costumer electronics retailer JB Hi-Fi posted a 35.2% rise in full year net profit after tax to $233.2 million, a record result in a weak retail market.

Revenue at the group, which includes home appliance chain the Good Guys, was up 21.79% to $6.85 billion.

The company says the strong growth was achieved through a combination of the organic growth of the JB Hi-Fi business and the full year contribution of the Good Guys compared to just seven months in 2017.

CEO Richard Murray the result was another record for sales and earnings.

“It was another strong result for the JB HI-FI business in Australia, as we continue to delight our customers and deliver on our strategic objectives,” he says.

“Whilst it was a challenging second half for the Good Guys business, we made strong progress towards our key initiatives as we position the business for future growth.”

For JB HI-FI Australia, total sales grew by 9.4% to $4.54 billion with comparable sales up 6.2%.

At the Good Guys, total sales for the twelve months to June were up 1.5% to $2.1 billion and comparable sales 0.9% higher.

In 2019, the company expects group sales of about $7.1 billion. And it plans to open five JB HI-FI Australia stores, two Good Guys stores and close one JB HI-FI New Zealand store.

Murray said: “We are clear on our objectives for the next 12 months and are excited in the outlook for the business”.

The full year dividend was a fully franked 132 cents, up almost 12%.

The results at a glance:

Source: JB Hi-Fi

In Australia at JB Hi-Fi stores, Hardware and Services sales were up 11.9%, with comparable sales 8.6% higher driven by Communications, Computers, Audio, Games Hardware and Drones.

But software sales were down 8.5% and on a comparable basis were down 11.2% as a result of an acceleration in the decline in sales of Movies but partially offset by
growth in Games Software.

Online sales in Australia grew 32.1% to $209.9 million or 4.6% of total sales.

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