MANY RIVERS STILL TO CROSS FOR JB HI-FI IN NZ

By Wares August 15, 2018 Industry news

JB Hi-Fi released a pretty good overall result for FY2018 on Monday but the Kiwi arm remains in negative territory.

JB Hi-Fi released its FY2018 Results on Monday showing good gains overall to end June 2018, despite a "challenging second half" for The Good Guys and more negative growth for the NZ arm.

Total sales were +21.8% at AU$6.9 billion, while the overall group EBIT was a healthy +14.5% at AU$350.6 million and NPAT +12.3% to AU$233.2 million.

JB Hi-Fi Australia

JB Hi-Fi Australia's sales were +9.4% to AU$4.54 billion, with comps +6.2% and Gross Profit +9.1% at AU$1 billion with a Gross Margin of 22.2%. CODB was 14.8%.

The JB Hi-Fi Australia EBIT was +11.4% to AU$292.3 million with an increased EBIT margin.

Australian online sales were +32% at almost AU$210 million or 4.6% of total sales.

JB Hi-Fi New Zealand 

The year-end story with JB Hi-Fi New Zealand wasn't as pretty.

Total sales were negative 1.1% at NZ$231.5 million, with comps +2.4% but the Kiwi Gross Margin was down at 17.7%.

Following the launch of the new website in August 2017, Online sales +96.3% to NZ$9.6 million or 4.1% of total sales.

The New Zealand business, however "continues to be repositioned to improve performance", with the exit of whitegoods, two store closures (and another on the way).

In which respect there's still some way to go: total JB Hi-Fi New Zealand sales for July 2018 were still negative at -2.1% (worse than July 2017) but comparable sales were +3.4% (a massive improvement over -7.6% on July 2017) although further negative growth to the NZ top line is expected (see below).

The Good Guys

Total sales for The Good Guys' first full year under the new ownership were AU$2.1 billion, which means total sales were +1.5% with comps a slim +0.9%.

The EBIT was AU$60.9 million with a Gross Profit of AU$426.1 million and a Gross Margin of 20.3%. CODB was 16.6%.

Online sales for the period were +7.4% at AU$126.8 million or 6% of total sales.

The overall FY19 trading outlook is for total group sales to be circa AU$7.1 billion, comprising: AU$4.75 billion from JB Hl-FI Australia; NZ$0.22 billion from JB HI-Fl New Zealand (meaning more pain for the Kiwi arm) and AU$2.15 billion from The Good Guys. 

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