Yet another retailer made its upgrade guidance from the boost triggered by the online boom in the year to June 30 – with sales growth continuing into the new financial year.
Kogan, the online-only e-tailer matched its upgraded confidence and guidance on Monday, and the much larger bricks and mortar operator, JB Hi-Fi followed suit.
And like Kogan JB Hi-Fi raised its final dividend – up 76.5% to 90 cents a share fully franked, bringing the total dividend for 2019-20 to $1.89 cents a share. That in turn was up 47 cents or 33.1% from 2018-19.
The company also announced a $1,000 bonus for its 13,000 staff for working during the pandemic.
JB Hi-Fi has been one of the biggest benefactors of Australia’s coronavirus lockdowns, with thousands of Australians buying new TVs, monitors, laptops, phones, watches, and keyboards to help work from home throughout March and April.
The retailer said the pandemic-sparked boost to its sales continue into July and August despite worsening lockdowns in Melbourne, as the company reported a record set of full-year earnings on Monday.
The company said sales in July and so far in August at JB Hi-Fi Australia were up a massive 42.1% and Good Guys sales up 40.4% for the same month.
JB Hi-Fi has closed 67 stores in Melbourne due to the Victoria latest lockdowns but sales through August have been strong regardless.
That was after the year to June saw an 11.6% rise in sales to $7.9 billion (compared with $7.1 billion the year before) across its JB Hi-Fi divisions in Australia and NZ (which did poorly because of the intense lockdowns there) and The Good Guys, the company’s appliances arm.
Statutory net profit was up 21% to $302.3 million, with sales and earnings within the company’s guidance which its reinstated and lifted in June after pulling abandoning guidance earlier this year amid uncertainty about the pandemic’s first surge.
Excluding a $24 million once-off impairment to JB Hi-Fi’s struggling New Zealand operations, underlying net profit rose 33.2% to $332.7 million. Pre-COVID earnings guidance was $270 million.
This is a strong result in the most challenging of times,” chief executive Richard Murray said in a statement yesterday.
“We are pleased to report strong sales and earnings for FY20 and importantly, we have provided our customers with the products they required as they spent more time working, learning and seeking entertainment at home, and kept our team members in jobs with an absolute focus on health and safety.”
Sales at JB Hi-Fi Australia, the company’s core business, jumped a strong 12.5% to $5.32 billion.
Higher costs were “more than offset” by the elevated sales, the company said yesterday.
“Gross profit increased by 11.7% to $1.17 billion resulting in a gross margin of 22.0%. Cost of doing business (“CODB”) was 14.1%, down 80 bps on the PCP. The business’s low CODB remains a competitive advantage and is maintained through a continued focus on productivity, minimising unnecessary expenditure and leveraging scale,” directors said in Monday’s statement.
Whitegoods seller The Good Guys saw sales surge 11.2% (much faster than forecasts a year ago) to $2.39 billion, with portable appliances, laundry, computer and televisions being the most popular products.
Online sales grew 50% across the year to nearly $600 million, 0r 7.5% of JB Hi-Fi’s total sales, with digital product sales leaping 134% in the June quarter.
JB shares rose 4.8% to $49.60. $50 and more seems on the cards, but for how long?
