JB Hi-Fi (ASX:JBH) share price shoots 7% higher on 'strong sales'

The company's shares are on the move this Tuesday morning.

| More on:
a girl wearing headphones strikes a dance pose as she smiles at her phone being held in her hand as if a great song is being played through her music setup.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key Points

  • The JB Hi-Fi share price surges 7.33% in early morning trade
  • The company's sales increased following heightened customer demand
  • Net profit is down 9.4% versus H1 FY21

The JB Hi-Fi Ltd (ASX: JBH) share price is racing higher today following a trading update from the company.

At the time of writing, the retailer's shares are swapping hands for $50.06, up 7.33%.

JB Hi-Fi continues sales momentum in FY22

Investors are buying up JB Hi-Fi shares after the company highlighted sales growth for the second quarter of FY22.

For the 3-month period ending 31 December 2021, the group achieved a double-digit increase in sales across its businesses.

JB Hi-Fi Australia experienced a 23.1% lift in sales volumes when compared against the prior corresponding period (Q2 FY20).

Meanwhile, JB Hi-Fi New Zealand and the Good Guys realised a 12.8% and 26.2% improvement in sales, respectively.

Sales momentum continued throughout the second quarter for JB Hi-Fi, with heightened customer demand for consumer electronics and home appliances products.

When looking at the first half of FY22, preliminary unaudited total sales came to $4.86 billion. This reflected a fall of 1.6% on H1 FY21, but an increase of 21.7% compared to the first half of FY20.

Online sales grew 62.6% to $1.1 billion, or 22.7% of total sales, underpinned by growth categories across the retailer's portfolio. This included communications, computers, games hardware, visual, and small appliances.

Earnings Before Interest and Tax (EBIT) sunk 9.1% to $420.5 million on last year's result but surged 59.5% over a 2-year period. JB Hi-Fi stated that this was driven by elevated sales growth, management of gross margins, and disciplined cost control.

On the company's bottom line, net profit after tax (NPAT) dipped to $287.9 million, a decline of 9.4% versus H1 FY21. In contrast, NPAT jumped 68.8% against the first half of FY20's financial results.

JB Hi-Fi group CEO Terry Smart touched on the results, saying:

We are pleased to report strong sales and earnings for HY22. In challenging circumstances, we have again demonstrated our ability to adapt and respond to meet the strong demand from our customers, both in-store and online.

The company will release its audited half-year results for the 2022 financial year on 14 February.

JB Hi-Fi share price snapshot

Over the past 12 months, the JB Hi-Fi share price has gone somewhat on a rollercoaster ride, down 11.5%. This is a stark contrast from when its shares were on a steep growth trajectory from March 2020 to August 2020.

On valuation grounds, JB Hi-Fi commands a market capitalisation of roughly $5.36 billion, with approximately 114.88 million shares on hand.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Retail Shares

A happy young couple celebrate a win by jumping high above their new sofa.
Retail Shares

Overinvested in Wesfarmers shares? Here are two alternative ASX retail stocks

These stocks could complement an investment in Wesfarmers.

Read more »

Happy shopper at a clothes shop.
Retail Shares

The share price of this All Ords stock has jumped higher again. Here's why

Here's why Myer's share price is outperforming.

Read more »

A smiling woman at a hardware shop selects paint colours from a wall display.
Retail Shares

Wesfarmers shares recently hit a 52-week high. Can they go higher?

This business continues to impress investors.

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
Retail Shares

Would Warren Buffett buy Lovisa shares right now?

Is this a sparkly opportunity?

Read more »

Happy shopper at a clothes shop.
Earnings Results

Why did Myer shares just rocket 9%?

Investors are piling into Myer shares on Friday. But why?

Read more »

a thoughtful shopper with shopping bags wearing sparkly gold dress and matching shoes reclines on a chair with hand to chin in thought.
Retail Shares

Can Lovisa's new high profile CEO take Lovisa shares to new heights?

Is Lovisa about to embark on a new era of growth?

Read more »

A woman sits on sofa pondering a question.
Retail Shares

After soaring 244% in 5 years, how much further upside does Macquarie tip for Nick Scali shares?

The broker's expectations remain steady.

Read more »

Girl with make up and jewellery posing.
Retail Shares

Buying the dip: $5,000 invested in Lovisa shares a month ago is now worth…

It's been an outstanding first month for new Lovisa shareholders.

Read more »