JB Hi-Fi's first-half profit surges 21 per cent to $151.7 million


Australia's largest home entertainment retailer JB Hi-Fi (ASX:JBH) has reported its net profit attributable to shareholders rose to $152 million in the half year ending December 2017.

JB Hi-Fi New Zealand total sales were down 0.4 per cent to NZ$124.6 million with comparable sales for the half year up 2.4 per cent. Online sales in New Zealand grew 89.8 per cent to NZ$4.8 million or 3.8 per cent of total sales.

As for its earnings before interest and tax (EBIT) it bolstered over the period, rising by 25 per cent or by $45 million rising to $226 million.

Shares in JB Hi-Fi are trading down 4.9 per cent lower to $26.73. The company did not break down the results for its solutions business but said that recorded a double digit sales growth.

The discount retailer signalled the shift for the New Zealand division a year ago, taking an A$15.8 million impairment charge on the business after reviewing the unit and deciding on a way to revive sales and fatten margins. This is compared to a result of $263 million in HY17.

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"It was another strong result for the JB HI-FI business in Australia, particularly through the important November and December periods", said the JB HI-Fi chief executive Richard Murray. JB Hi-Fi closed one store in New Zealand.

JB Hi-Fi's rejigged strategy for its New Zealand business all but wiped out first-half earnings on this side of the Tasman as the discount consumer electronics chain shut one store and quit selling whiteware goods.

Not a great result for New Zealand, however, management will be putting most of its energies into the Australian business and integration of The Good Guys. The forecast indicates a 13% - 16% lift of underlying results, compared to the previous period.

"It was pleasing to see sales growth in The Good Guys throughout the half whilst we continued to take a considered and deliberate approach to change", he says.

Following on from the acquisition of The Good Guys, total group sales are forecast to be around $6.85 billion. JB Hi-Fi came in at No. 218, and is only the third Australian retailer to boast a place.