The JB Hi-Fi Ltd (ASX: JBH) share price is under focus after the electronics retailer announced its FY25 result.
The company operates four retail businesses – JB Hi-Fi Australia, The Good Guys, JB Hi-Fi New Zealand and E&S.
JB Hi-Fi FY25 result
Here are some of the highlights of the FY25 report:
- Total sales increased 10% to $10.6 billion
- EBIT (EBIT explained) grew 7.3%
- Underlying EBIT rose 9.4% to $694.1 million
- Net profit after tax (NPAT) increased 5.4% to $462.4 million
- Underlying net profit rose 8.5% to $462.4 million
- Final dividend per share up 1.9% to $1.05
- Special dividend per share of $1.00 per share
Let’s take a look at the performances of the individual segments.
JB Hi-Fi Australia
This division saw total sales growth of 7.5% to $7.1 billion thanks to customer demand, new product releases and promotional activity.
Gross profit only grew 6.4% to $1.56 billion because of a changing mix of sales and “ongoing competitive activity”.
However, the cost of doing business (CODB) ratio improved 19 basis points (0.19%) to 12.4%, meaning the business was more efficient with its costs.
The cost improvement helped EBIT grow 8% to $530.3 million, being faster growth than sales.
JB Hi-Fi New Zealand
Total sales here grew 20.8% to NZ$396.3 million, with online sales growth of 48.1% to NZ$63 million.
Gross profit rose 21.3% and the CODB significantly improved by 86 basis points (0.86%) to 14.7%. The cost improvement came despite continued investment in new stores and strategic initiatives.
While EBIT was negative NZ$0.2 million, it was an improvement of NZ$2 million.
The Good Guys
Total sales rose 6.9% to $2.87 billion, with online sales growth of 9.9% to $425.4 million.
Gross profit grew 8.2%, but the CODB also grew 65 basis points (0.65%) to 14.6% – the company highlighted an investment in store wages to support increased store traffic.
Due to the rise in costs, EBIT here only grew by 1.1% to $159.8 million.
E&S
In September 2024, it completed the acquisition of 75% of E&S, a “highly complementary premium home appliance and bathroom retailer”.
For the period of ownership, total sales increased 5.2% to $225.2 million – sales growth was driven by the commercial division.
EBIT was $4.2 million, in line with expectations.
Larger dividend payout ratio
The company announced it’s increasing the FY26 dividend payout ratio to a range of between 70% to 80% of net profit from FY26, up from 65%.
It wants to maximise returns to all shareholders, while maintaining an “optimal capital structure” that provides balance sheet strength for organic and acquisition opportunities.
New CEO
JB Hi-Fi announced that group CEO Terry Smart will retire from the company on 3 October 2025 and will be succeeded by Nick Wells, who is currently the company’s chief operating officer.
FY26 trading update
The company revealed a strong start to the 2026 financial year, in the month of July 2025.
JB Hi-Fi Australia sales growth was 6.1%, JB Hi-Fi New Zealand saw sales growth of 38.1%, The Good Guys experienced sales growth of 4.2% and E&S saw sales growth of 1%.
Final thoughts on the JB Hi-Fi share price
It’s pleasing for shareholders to get bigger dividends, but the decline in profit margins isn’t ideal.
The company is doing well to grow at the pace that it is, and I think it’s worthy of a higher price/earnings (P/E) ratio than it used to have because its earnings are higher quality and more defensive, but I wouldn’t call it a strong buy today.
There are other ASX dividend shares that appeal to me more. How much will competition hurt JB Hi-Fi’s margins in the coming years?
