Australian electronics retailer JB Hi-Fi reported a 20% decrease in net profit for the first half of the year, driven by a decline in consumer spending amidst elevated inflation. Despite challenging market conditions, the company’s net profit for the six months through December stood at AUD 264.3 million, surpassing market expectations of AUD 238 million.
During the same period, JB Hi-Fi experienced a 2% decrease in sales to AUD 5.16 billion. The company attributed this decline to heightened competition and increased on-floor discounting. However, despite the overall decrease in sales, the retailer’s main Australia business saw a modest 0.1% increase in comparable sales. This was offset by a 3% decrease in gross profit due to sales and discounting.
Contrastingly, JB Hi-Fi’s New Zealand operations witnessed a 1.2% decline in comparable sales. However, gross profit for this region increased by 8.9%. The Good Guys home-appliance chain experienced a significant decrease in comparable sales by 9.9%.
JB Hi-Fi’s performance in January provided a mixed picture as well. While Australia experienced a notable rise of 1.7% in comparable sales, New Zealand and the Good Guys witnessed declines of 4.1% and 2.2%, respectively.
Amidst broader cost-of-living pressures, analysts have expressed concerns about the outlook for the consumer-electronics sector. Nonetheless, JB Hi-Fi had initially benefited from the pandemic, as consumers sought work-from-home gear and entertainment during lockdowns.
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