JB Hi-Fi Solid, But January “Lumpy”: Analysts

X

As JB Hi-Fi profits, sales soar, “lumpy” January sales doesn’t mean a slowdown, say analysts

No major surprises in JB Hi-Fi HY14 earnings, say analysts although there was concerns about “weak” cash flow in 1H, which fell below expectations. 

The electronics retailer saw HY14 net profit spike 10% to $90.3 million, sales rose 7% to $1.94 billion for six months to 31 December last, buoyed by growth in white goods, TV and commercial. 

Comparable sales for January rose 3.8%, compared to 2% as reported in JB’s trading update released earlier in the month.  

JB Hi-Fi like-for-like (LFL) sales growth rate seems to have accelerated sharply in the final days of January, climbing almost 2%, notes Michael Simotas, Deutsche Bank analyst, in a research note. 

“While sales can be lumpy from week to week, this is pleasing given it arrests the concerns some held last week that the LFL sales momentum was slowing.”

Operating cash flow of $78.3 m was singled out as the only negative from yesterday’s result, given the fall was equivalent to 30% representing approx. 72% cash conversion, and was below DB analysts’ estimates of $106.2 m. 

JB forecast FY 14 NPAT to rise 8.3%-10.8% “is only slightly ahead of analysts expectations (Bloomberg) but in our view may lead to modest consensus upgrades due to the conservative track record of management,” says Simotas. 
Inventory build in existing stores seems to be the key issue. Analysts also queried the driver of the gross margin improvement given the mix related headwinds.

Shares rose following the earnings announcement, yesterday.  
728x90 Leaderboard UNIFI JB Hi Fi Solid, But January Lumpy: Analysts
UE Wonderboom2 CNWeb LB Blue JB Hi Fi Solid, But January Lumpy: Analysts
Dec21 728x90 1 JB Hi Fi Solid, But January Lumpy: Analysts
2375 Flare 4SQM Digital Banner Ads LB 728x90 scaled JB Hi Fi Solid, But January Lumpy: Analysts
en us WDB SN850 SSD HEATSNK PS5 WebBnr Game On 728x90 1 JB Hi Fi Solid, But January Lumpy: Analysts
4SQM banner 728x90px Wave Shuffle l JB Hi Fi Solid, But January Lumpy: Analysts
XMAS Gemini Aqipa 4SQM Banner Ads Leaderboard 728x90px ANZ JB Hi Fi Solid, But January Lumpy: Analysts
3047 Audio 4Square LG XBOOM 360 728x90 JB Hi Fi Solid, But January Lumpy: Analysts
728x90 JB Hi Fi Solid, But January Lumpy: Analysts
Mode II 728x90px product JB Hi Fi Solid, But January Lumpy: Analysts


YOU MAY ALSO LIKE