Dick Smith demise boosts results.
JB Hi-Fi has posted a 7.5% increase in its key half-year profit, following stronger retail demand and the collapse of Dick Smith.
According to JB Hi-Fi’s chief executive Richard Murray (pictured), “This was a solid result with trading in the important November and December periods particularly strong as we executed on a great promotional plan.”
The first-half results cover the pre-Christmas trading period with increased profit at $95.2 million. The company has forecast that it is on track to post an annual net profit after tax of between $143 and $147 million.
Sales were up 7.7% to $2.1 billion, with sales at long-established stores up 5.2% and the remainder of growth from increase store numbers. The company has already opened seven new stores in the half and expects to open one more this year.
JB Hi-Fi now has 194 stores across Australia and New Zealand, of which 56 sell whitegoods, while 22 existing JB Hi-Fi stores added small appliances in the half-year to December, with another 15 expected to follow over the rest of the financial year.
Meanwhile, analysts predict that the ongoing issues with Dick Smiths will continue to boost JB’s fortunes. JB Hi-Fi has already reported strong January sales results, despite discounting on some Dick Smith merchandise by the receivers, with total consolidated growth of 10.2%.
“Sales in January 2016 were pleasing given the strength in the prior year, with back to school technology purchases in both our retail and solutions businesses driving sales,” Murray added.
JB Hi-Fi will pay an interim dividend of 63 cents per share, up from 59 cents at the same point last year.