BREAKING NEWS: JB Hi Fi Sales Slow, Underperforming Brands Face Being Dropped
JB Hi Fi has given the first indication that sales of consumer electronics are softening in a presentation at today’s Macquarie Equities Conference.
CEO Richard Murray said that JB Hi Fi Q3 results reveal that Q3 total sales growth was 2.6% Vs 7.5% in the same period in 2018, comparable sales growth has fallen to 1,5% vs 4.3% in 2018.
Like for like store sales in Australia and New Zealand remained positive, the company said. But it suffered a slight dip in sales growth for the March quarter in its struggling New Zealand outlets.
At a time when many discretionary retailers are suffering from a sales slump, the retailer posted strong sales growth at its Australian operations, including its Good Guys stores, over the third quarter.
In a trading update delivered to the Macquarie Australia Conference, JB Hi-Fi reaffirmed its 2019 guidance, with total group sales to be circa $7.1 billion comprising:
JB Hi-Fi Australia $4.73 billion
JB Hi-Fi New Zealand (NZD) $0.24 billion
The Good Guys $2.15 billion
Year to date sales growth was 4.1% Vs 9.8% in 2018.
The Good Guys has performed better with total sales growth in Q3 of 2.2% Vs -1.3% in 2018. Comparable sales growth was 1% Vs -2.9% in 2018.
Total sales growth was 2.6% Vs 1.2% in 2018.
The Company that is still on track to deliver $7.1 billion in sales in Fy19 said that sales at JB Hi Fi will be $4.3B while sales at The Good Guys will come in at around $2.15B
Total NPAT will be in the range of $237M to $245M an increase of 1.6%.
At its JB Hi-Fi New Zealand stores third quarter total sales shrank 1.2 per cent with comparable sales growth of 4.6 per cent. Year to date fiscal 2019 total sales growth was 3.7 per cent with comparable sales growth of 10.2 per cent.
In major new initatives the mass retailer said that they are set to expand their range of entry level TV’s while also delivering a new instore gaming experience centre.
A trial of a new TV install service was completed in January 2019.
The Company will also expand sales of Telstra linked smartphones at The Good Guys who is also set to trial a ‘Big & Bulky’ delivery centre.
At a supplier lever both retailers are set to undertake monthly sell through analysis in an effort to more quickly identify “under performers”. This will be achieved with the introduction of new reporting and analysis tools.
ChannelNews understands that several brands face being dropped from JB Hi Fi stores.
This operation will be under the control of Cameron Trainor Managing Director of Group Merchandising.
Currently the Company is trialling new store formats at a number of stores built around new Telco and Connected Tech offerings.
Currently the group is trialling a new Shopify Plus eCommerce platform as well as a new EDM platform that will connect customer information databases and sales with stores.
The Good Guys has also introduced a new commission structure and 30% of their stores have been “fully relayed” providing customers with a better vin store experience.
Shares in JB Hi Fi fell 1.23% on the news.
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