Plenty of positive news from the Thursday ASX trading session, including these announcements from JB Hi-Fi, National Australia Bank and Southern Cross Media Group.
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The post-omicron rebound for consumer electronics and whitegoods retailer JB Hi-Fi (ASX: JBH) continues, judging by its latest trading update on Thursday.
In its half year result, JBH had indicated it has started seeing a recovery in sales growth in its mainstream JB Hi Fi outlets and in the stores of its Good Guys whitegoods chain.
On Thursday JBH said the strong start to the second half had seen stronger sales growth deep into the current third quarter.
JBH said sales at its core Australian JB stores had jumped 10.5% for the quarter to date, and were up 5.1% at its Good Guys business.
This is a further acceleration in sales from the company’s half-year announcement in February, where January sales for the Australian stores rose 4.3%
JB said the business had seen heightened customer demand through the quarter, which combined with tight cost controls and specific focus on sales and stock availability, had driven strong profitability for the quarter.
“Whilst the Group is pleased with the start to the second half, in view of the ongoing disruption arising from Covid-19 and other local and global uncertainties, the Group does not currently consider it appropriate to provide FY22 sales and earnings guidance,” the company again said.
This was an update the market liked, sending JBH shares up 4.33% to $52.90 on a day when the wider market was sluggish.
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Meanwhile the market has shrugged its shoulders at the news that the National Australia Bank (ASX: NAB) is planning a second multi-billion-dollar buyback.
The new buyback of $2.5 billion is separate to the existing $2.5 billion offer which has just wrapped up.
Subject to market conditions, the new buy-back will commence following the release of the NAB’s half-year results on May 5.
The news saw the shares go sideways – up 0.7% at $31.79.
The latest buyback means the bank will have returned most of the $5.5 billion it raised in March 2020 as the first wave of the pandemic was rolling across the economy and country generally.
The impact of COVID-19 on the banks was far milder than initially expected and NAB is now reversing the trend of that share dilution through the two buy-backs.
It is also an acknowledgement by the NAB that it really can’t use the money to finance any more lending activity.
CEO Ross McEwan said in Thursday’s announcement the $5 billion in combined potential buy-backs “supports our ambition to reduce share count and increase sustainable [return on equity] benefits for our shareholders”.
“Our capital management strategy reflects the importance of maintaining a strong balance sheet through the cycle while allowing us to continue to support growth and deliver improved shareholder returns,” Mr McEwan said.
Analysts now wonder if the Commonwealth will follow with another buyback in August after its $2 billion announced in February (on top of its big $6 billion one last year).
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Southern Cross Media (ASX: SXL) wants to run a $40 million buyback and to help the offer, says it has been approached by unnamed “parties’ sniffing around its weakly performing regional TV business that is now the Ten affiliate in rural Australia.
Southern Cross has tried to sell its regional television company for several years but has not had any serious bites – it was the regional affiliate of Nine for a while but that ended last year and the underperforming Ten Network is now the content supplier.
Southern Cross recently hired advisers, Grant Samuel to assess future strategic options. In a statement to the ASX on Thursday, Southern Cross revealed the approaches which it said are non-binding, incomplete and without price or conditions.
“There is no guarantee that any of these approaches will result in a transaction,” Southern Cross said.
“With the assistance of its financial adviser, Grant Samuel, SCA will continue to assess strategic options for its television business, including engaging with interested parties regarding a potential sale, for the benefit of shareholders. The Board will continue to update shareholders as appropriate.”
Seven now controls all of its regional broadcasters after buying Prime. Nine’s regional affiliate is WIN, controlled by Bruce Gordon and his family that is also the largest shareholder in Nine with a direct 14.9% stake and derivatives that take the holding to just under 20%.
Southern Cross said the on-market buy back scheme will be funded from existing cash reserves and debt facilities.
The announcement comes a month after Southern Cross reinstated an interim dividend.
The hints of a possible sale set the shares alight somewhat and they added more than 7% to close at $1.745.
