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JB Hi-Fi shares soar after record earnings lift

Nicholas Grove  |  13 Feb 2017Text size  Decrease  Increase  |  

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JB Hi-Fi Limited's (ASX: JBH) underlying net profit for the first half of fiscal 2017 rose 32 per cent to a record $125.4 million, after the electrical retailer rang up $2.6 billion in sales.

Statutory net profit stood at $110.4 million, up 16 per cent on the same half in the prior year.

Underlying earnings per share (EPS) were up 22.4 per cent to 116.3 cents a share, while underlying earnings before interest and tax (EBIT) were up 30.9 per cent to $180.8 million.

The results exclude costs relating to the $870-million acquisition of The Good Guys, which was completed in November 2016.

JB Hi-Fi declared a half-year dividend of 72 cents a share, fully franked, up 14.3 per cent on the same half in fiscal 2016, representing a payout ratio of 65 per cent.

The dividend will be paid on 10 March 2017 to shareholders on record as at 24 February 2017.

Investors were pleased with the result, sending shares in the company over 5 per cent higher by midday on Monday.

"It has been a particularly strong 12 months for the JB Hi-Fi business in Australia and we are pleased to have successfully completed our acquisition of The Good Guys," JB Hi-Fi CEO Richard Murray said in a statement to the ASX.

"Having successfully completed our acquisition of The Good Guys, the group is well positioned to build on its solid momentum into the second half."

Comparable sales were up 8.7 per cent in Australia for the half, while New Zealand comps were down 11.2 per cent. For December 2016, comparable sales at The Good Guys were down 0.7 per cent.

For January 2016, comparable sales across the group were up 7.2 per cent, which JB Hi-Fi said was "pleasing given the strength in the prior corresponding period".

For the full year, the company expects underlying net profit to be in the range of $200 million to $206 million, an increase of 31.4 per cent to 35.4 per cent on the previous year.

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Nicholas Grove is a Morningstar journalist.

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