JB Hi-Fi (JBH) shares fell 16c yesterday, to $20.64, after the electronics retailer said CEO Terry Smart would be retiring in August after 14 years with the company.
The fall followed an earlier rise and was somehow appropriate that investors saw the departure (something of a surprise) of a successful CEO as a negative at a company that had performed strongly in the past two and a bit years.
The fall came despite the general demand for consumer stocks in trading yesterday.
That saw the banks and retailers chased by investors (Woolworths hit another new all time high yesterday, for example).
As well as announcing the departure of Mr Smart and his replacement by the chief financial officer Richard Murray, JB Hi Fi reaffirmed its earnings guidance for the year.
The company said it still expected a net profit between $126 million and $129 million for the year to June, after posting comparable sales growth of 3% in the March quarter and topline sales growth of 5.7%. Both were better than the inflation rate in the quarter.
"JB HI-FI has been an incredibly important part of my life, having been involved in the growth of the company from 10 stores to the 182 stores we have today," Mr Smart said in a statement to the ASX.
JBH 1Y – Terry Smart to depart JB Hi-Fi
After 30 years in retail, Mr Smart said he was confident that Mr Murray could lead JB Hi-Fi into the future, and that he was looking forward to spending more time with his family.
Mr Smart took on the role of CEO in August 2010, at a time when retailers were struggling with low consumer confidence amidst the global financial crisis.
The shares hit a post GFC low of $7.92 in June of 2012, and have almost trebled since then.
That was despite 18 months of weak to middling growth in retail sales and intense price competition and downward pressure which was driven by the high value of the Aussie dollar and weak consumer spending.
Nick Wells, the currently group financial controller will become Chief Financial Officer.
