JB Hi-Fi earnings numbers remain sound

A surprisingly solid early update Tuesday from electronics and whitegoods retailer JB Hi-Fi (ASX:JBH) about its 2021-22 sales and earnings – with the company reporting record performances for both in the 12 months to June.

“Sales momentum was strong throughout the year with total sales up 3.5% to $9.2 billion by June 30, the company said in Tuesday’s brief release.

JBH said its online sales were up 52.8% to $1.6 billion or 17.6% of total sales.

Full year earnings before interest and tax (a key measure of retail profitability) were up 6.9% to $794.6 million, thanks to a strong June half with a 33.4% driven by “elevated sales growth and improvement in gross margins.”

The company said the fourth quarter was very strong and now sees a 7.7% lift in net profit after tax for the year to June to $544.9 million.

JB Hi-Fi said its Australian business saw comparable store sales of 10.9% and total sales of 11.6% during the quarter. This underpinned a 4% increase in sales for 2021-2.

It was a similar story for the company’s New Zealand business, which delivered comparable store and total sales growth of 7.7% for the fourth quarter. This took its full year sales into positive territory at 0.3%.

And finally, The Good Guys white goods -based business in Australia was reported a 7.3% lift in comparable store sales and a 7.8% increase in total sales during the three months.

As a result, The Good Guys delivered total full year sales growth of 2.7%.

Group CEO Terry Smart, said “We are pleased to report record sales and earnings for FY22. The benefits of having a strong multichannel strategy were especially evident in the second half as Covid-19 restrictions eased and customers returned to shopping in-store, whilst continuing to shop with us online.”

“It is a credit to our over 13,000 team members who continue to remain focused on providing outstanding customer service and worked tirelessly to deliver this record result,” Smart said on Tuesday.

No mention of a final dividend (that will come August 15 with the full results).

JBH paid an interim of $1.63 a share and a final for 2020-21 of $1.07.

The 7.7% rise in the full year figure and the strong final quarter would normally point to a big rise in the final, but the growing uncertainty about the outlook with rising interest rates, weakening consumer confidence and falling house prices might just see the company play it safe and conserve cash in case the predicted slowdown eventuates.

The shares were up 2.1% to $41.76. That’s a long way from the record $56.85 in March.