JB Hi-Fi has announced a capital return of up to $250 million to shareholders by way of an off-market buy-back.
This news comes as the company issues its half-year results, which saw total sales down 1.6 per cent, to $4.86 billion, and net profit after tax down 9.4 per cent to $287.9. These figures were flagged in mid-January.
Whilst down, these figures are skewed due to a truly outlier period during the final half of 2020, when customers were setting up home offices, spending more on entertainment, and enjoying more disposal income due to the lockdown.
JB Hi-Fi notes that total sales are actually up 21.7 per cent over a two-year period, EBIT is up 59.9 per cent over this same period (down 9.1 per cent year-on-year), and net profit after tax is up 68.8 per cent since the last half of 2019.
A total of up to $437 million will be returned to shareholders, through the buyback which includes approximately $99 million worth of franking credits, and interim dividend of $1.63 per share. This will be payable on March 11.

Terry Smart, JB Hi-Fi.
“While it remains an uncertain retail environment, we will continue to stay focused on what we can control,” said CEO Terry Smart, who declined to provide FY22 sales and earnings guidance, “in view of the ongoing uncertainty arising” from COVID and supply chain issues.
“Our highly engaging in-store and online shopping experiences delivered by our passionate and knowledgeable team members, and our continued focus on leveraging our scale to deliver great value will ensure we meet our customers’ needs during these challenging time.”
Total online sales across the Group grew by 62.6 per cent to $1.1 billion, representing 22.7 per cent of total sales.
This isn’t just a COVID-related spike. Even excluding sales during the periods where stores were temporarily closed in Sydney and Melbourne, online sales represented 14.0 per cent of total sales.
“We continued to see elevated demand across all of our sales channels, particularly online which our customers seamlessly transitioned to during the various lockdowns demonstrating the strength and trust in our brands,” Smart said.
JB HI-FI Australia
The Australian arm of JB saw total sales decline by 1.9 per cent to $3.29 billion, with comparable sales down 2.5 per cent. Over a two-year period, total sales leapt an impressive 20.8 per cent.
Gross profit was down 2.9 per cent, to $716.3 million. Gross margins were down 21 bps to 21.8 per cent.
Cost of doing business was 10.8 per cent, up 71 basis points, but remaining impressive. As the company points out, JB’s traditionally low cost of doing business “remains a competitive advantage, and is maintained through a continued focus on productivity, minimising unnecessary expenditure and leveraging scale.”
Online sales grew 59.9 per cent to $823.9 million – a quarter of total sales.
EBIT declined 11.3 per cent to $292.4 million, but was up 39.7 per cent over two years. Again, the EBIT margin was up 120 basis points, which Smart puts down to elevated sales growth, gross margin management and disciplined cost control.
Heightened customer demand for consumer electronics and home appliance products continued throughout the six months period. Key growth categories for JB Hi-Fi Australia were Small Appliances, Smart Home, Games Hardware, Accessories and Visual.
The Good Guys
The Good Guys saw a modest decline in total sales, which were down just 0.8 per cent, to $1.44 billion, with comparable sales down 1.3 per cent. Over a two-year period, total sales were up 25.4 per cent (comparable sales up 24.7 per cent.)
The Good Guys saw even more digital take up than JB, with online sales up 69.8 per cent to $251.3 million – making up 17.5 per cent of total sales.
Gross profit was $324.9 million, with gross margin up 19 basis points to 22.6 per cent, This was “driven by strong improvements in key categories,” according to the company.
CODB was 11.4 per cent, up 45 basis points, due to wages remaining “in control” throughout the half-year.
EBIT declined 4.3 per cent to $121.1 million, but jumped an amazing 131.8 per cent over a two-year period.
Customer demand for consumer electronics and home appliance products remaining heightened, while key growth categories were Portable Appliances, Floorcare, Laundry, Dishwashers and Cooking.
JB HI-FI New Zealand
Considering the stop/start nature of New Zealand’s retail sector, it’s not too surprising the NZ stores fared worse than the Aussie ones. Total sales were down 4.5 per cent to A$128.79 million, with comparable sales only down 4.5 per cent. The two-year total sales were up 4.2 per cent, so less of a jump than its Australian counterpart.
EBIT, however, was up 6 per cent, to A$6.8 million.
Online sales in New Zealand grew 81.5 per cent, making up to A$27.5 million, equalling 21.4 per cent of total sales. EBIT was up 6.0% to NZD7.3 million.
The key growth categories were Games Hardware, Visual and Smart Home.
January and beyond
The JB Group also provided a sales update for January, 2022.
“In January, despite the disruption to our supply chain and operations as a result of Covid-19, the Group continued to see heightened customer demand and strong sales growth rates over a two-year period.
“Whilst the Group is pleased with the start to the second half, in view of the ongoing uncertainty arising from Covid-19, the Group does not currently consider it appropriate to provide FY22 sales and earnings guidance.”
As Smart said, “we will continue to stay focused on what we can control,” in this uncertain market.
“I would again like to thank our over 13,000 team members whose unwavering focus on the customer has delivered another strong result.”
JB Hi-Fi saw its shares jump 6.8 per cent as of midday.