JB Hi-Fi share price rises on strong $525 million profit

Profit held up during FY23, despite the cost-of-living impacts.

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The JB Hi-Fi Limited (ASX: JBH) share price is up 2% in early trading.

That's because the large electronics and appliance retailer has just released its FY23 result to investors that showed resilience.

JB Hi-FI share price rises on impressive full-year result

JB Hi-Fi Australia saw total sales rise 5.6% to $6.55 billion with comparable sales growth of 4.8% and EBIT growth of 1.3% to $551.9 million.

JB Hi-Fi New Zealand sales (and comparable sales) rose 11.3% to NZ$292.1 million, while EBIT sank 49.9% to NZ$4.4 million due to impairments. Excluding impairment impacts, the underlying EBIT was negative NZ$2.2 million according to JB Hi-Fi, down from NZ$6.9 million.

The Good Guys sales rose 0.8% to $2.81 billion and EBIT fell 11.8% to $213 million.  

What else happened in FY23?

The business has been working hard on ESG (environmental, social and governance) factors during the year.

In terms of its people, JB Hi-Fi increased the number of women in leadership positions and it's offering mental health and wellbeing training programs to employees.

On the environmental side, the company decreased its scope 1 and scope 2 emissions by 9.6% thanks to installing solar power generation at nine stores. There are now 24 stores with solar power and it's working towards net-zero direct emissions by 2030. Plastic bags are going to be phased out nationally and replaced with recyclable paper bags.

What did JB Hi-Fi management say?

The JB Hi-Fi CEO Terry Smart said:

We are pleased to report record sales and earnings per share for FY23. In a challenging retail environment, we remained top of mind for shoppers and grew our market share by continuing to drive our value offering, leveraging the strength of our multichannel offer and maintaining our high levels of customer service.

With the heightened uncertainty in the retail environment, both our brands remain well-positioned to leverage their low-price market position as shoppers look to maximise value from their purchases. As we have continued to demonstrate, we will adapt and respond to the changing retail conditions to ensure we remain the number one destination for shoppers and grow our market share.

FY24 outlook

The ASX retail share gave investors a trading update for the month of July 2023, being the first month of FY24. Total sales for JB Hi-Fi Australia were down 1.8%, JB Hi-Fi New Zealand sales were up 10% and The Good Guys sales were down 12%.

The company said that July sales were in line with its expectations because it was cycling the elevated period of sales from last year. Total sales continue to be "well above" pre-COVID July FY19, but it has seen "increased variability in category performance".

JB Hi-Fi share price snapshot

After the sell-off of the share market in 2022, it has been a positive year for the company so far. Before today's release of the FY23 result, the JB Hi-Fi share price had risen by 12% in 2023. That compared to a rise of 5.7% for the S&P/ASX 200 Index (ASX: XJO).

Motley Fool contributor Tristan Harrison 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 recommended Jb Hi-Fi. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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