The JB Hi-Fi Limited (ASX: JBH) share price is currently up more than 3% after reporting a strong end to FY22.
JB Hi-Fi is a leading retailer of products like fridges, phones, computers and TVs.
It just gave an update for the last quarter of FY22, as well as announcing some preliminary FY22 numbers.
JB Hi-Fi’s FY22 update
The ASX 200 (ASX: XRO) retailer said that in the fourth quarter of FY22, it saw ongoing heightened customer demand and strong sales growth.
In the three months to 30 June 2022, JB Hi-Fi Australia sales increased by 11.6%, JB Hi-Fi New Zealand sales rose by 7.7% and The Good Guys sales rose by 7.8%.
Those numbers meant that all three divisions were able to report sales growth for FY22 – JB Hi-Fi Australia sales increased by 4%, JB Hi-Fi New Zealand sales rose by 0.3% and The Good Guys sales increased by 2.7%.
Total sales for the year across the whole business rose by 3.5% to $9.2 billion. Online sales increased by 52.8% to $1.6 billion, representing 17.6% of total sales.
Profitability
With the end of FY22, JB Hi-Fi was able to give an early indication of profit for the year.
EBIT (EBIT explained) for the full 2022 financial year was up 6.9% to $794.6 million compared to FY21, with the second half EBIT up 33.4% driven by elevated sales growth and an improvement in the gross profit margins.
JB Hi-Fi Australia’s EBIT rose 4.2% to $544.9 million. JB Hi-Fi New Zealand EBIT jumped 51.7% to NZ$8.8 million. The Good Guys EBIT increased by 12.5% to $241.4 million.
Looking at net profit after tax (NPAT), JB Hi-Fi reported 7.7% growth to $544.9 million.
The ASX 200 retailer attributed this performance to having a strong multichannel strategy, particularly in the second half as customers utilised both stores and online.
July comments
JB Hi-Fi noted that it is cycling a number of different state-based COVID-19 restrictions in the prior year, including store closures in Greater Sydney and Victoria from mid-July 2021. A trading update will be given with its full year result on 15 August 2022.
My thoughts on the JB Hi-Fi share price
The retailer is a leader in the sector and I think it’s usually worthwhile owning the best in the industry, if investors want a retailer. After a 20% drop since the end of April 2022, it looks much more appealing.
There continues to be strong demand and I think people will continue to buy things like computers and phones during leaner times.
While I think there are a few other retailers with more growth potential, I believe JB Hi-Fi could also be one of the useful ASX dividend shares to own thanks to its commitment to paying good dividends. Total returns compared to the ASX 200 could be decent from here.
