Appliance Market Bigger Than CE Says JB Hi Fi CEO, New Expansion Plans Revealed
Murray said the mass retailer’s cost of doing business continued to be a significant advantage and at 15.2 per cent, this remains lower than their main competitors which include Harvey Norman, The Good Guys and Dick Smith.
He added that since May, retail trading conditions have been challenging, both in the consumer electronics and appliance category sector and the broader economy. “Week to week trading remains volatile, however sales had improved during September and October, which we believe places JB Hi Fi in a good position as they move into the key Christmas trading period,” he said.
In FY14 the mass retailer achieved sales of $3.48 billion, up 5.3 per cent and comparable sales growth of 2.0 per cent.
Net profit after tax was up 10.3 per cent to $128.4m, earnings per share were up 9.1 per cent and the full year dividend was up 16.7 per cent or 12.0 cents per share on the prior year to 84.0 cents per share.
There were 182 stores (Australia: 147 JB Hi-Fi stores and 22 JB Hi Fi Home stores, NZ: 13 JB Hi-Fi stores) open as at 30 June 2014.
During FY14, the company opened seven new JB Hi-Fi stores and one new JB-Hi-Fi Home store in Australia.
One Clive Anthony store and two JB Hi-Fi stores were closed during FY14.
Murray said that JB Hi Fi plans to open eight new stores in FY15 (three JB HI-FI stores and five JB Hi Fi Home stores) and that the company will maintain its target of 214 stores across Australia and New Zealand.
JB Hi Fi Home
He said that JB Hi Fi Home represented a significant growth opportunity for the company in a market that is worth $4.6 billion. He pointed out that this market is actually bigger than the consumer electronics market where JB Hi Fi currently trades.
Murray said the company’s appliance expansion plans were already 12 months ahead of schedule.
“As consumers embrace the connected home experience and appliances become a fashion statement within the home, JB Hi-Fi will be seen as the destination for expert advice from our passionate and knowledgeable staff”.
Currently there are 22 JB Hi Fi Home stores as of June 30th with 53 planned by the end of FY15.
JB Hi Fi online sales were up 13.9 per cent in FY14, and represent approximately 2.2 per cent of total sales. The popularity of JB Hi-Fi’s websites continues to grow with unique visitors to the websites increasing by 9.9 per cent over the previous 12 months to an average of 1.3 million per week.
JB Hi-Fi’s commercial division continued to see strong growth in FY14 and remains on track to deliver on our longer term aspirational sales target of $500m per annum, Murray said.
JB Hi Fi management has maintained their guidance for FY15 total sales of $3.6 billion and expect the market to remain competitive as retailers drive for market share.