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JB HI-FI (ASX: JBH) has seen a big lift in profits and sales in the full year to 30 June 2016, taking shine off its former rival Dick Smith.
The Melbourne-based electronics retailer today reported an increase of 11.5 per cent in its net profit after tax to $152.2 million, from sales of $3.95 billion, which was up 8.3 per cent from the prior corresponding period.
The company may have taken market share from Dick Smith, which fell into liquidation in early January and closed its last store on May 3 before being relaunched as an online-only retailer by Kogan.com.
During fiscal 2016, JB HI-FI opened nine new stores and closed two stores. The company is planning on opening another seven stores in fiscal 2017.
JB HI-FI CEO Richard Murray says it was a great finish to the financial year for the company, which recorded a particularly strong June driven by tax time buying.
Online sales were up 35.8 per cent in the full year and now represent 3 per cent total sales for JB HI-FI.
However, Murray believes JB HI-FI Solutions will be the key driver of future growth, a subsidiary that delivers ICT business solutions.
"JB HI-FI Solutions is a key driver of our future growth. The combination of our product and service offering, along with our extensive store distribution network, continues to resonate with our clients," says Murray.
JB HI-FI will continue its on-market share buy-back program in fiscal 2017 of 700,000 ordinary shares, at a cost of $13.2 million. The company says the buy-back is intended to offset the dilutionary impact of shares.
So far, JB HI-FI has performed well in this financial year, with July's total sales growth almost 6 per cent higher than July last year.
The JB HI-FI board will pay a dividend of 37c per share fully franked on September 9.
Read about JB HI-FI's potential takeover of The Good Guys.
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