JB Hi-Fi defies coronavirus retail slump, secures new $260m debt deal

JB Hi-Fi sales accelerate as shoppers stock up on lockdown tech, as it secures another $260m in finance it says it probably won’t need.

JB Hi-Fi says customers stocked up on tech and entertainment products in preparation for the coronavirus lockdown. Picture: Tony Martin

Consumer electronics and white goods retailer JB Hi-Fi witnessed an acceleration in sales across its group as shoppers grabbed technology, game consoles, TVs and other household and entertainment products to prepare for a lengthy lockdown.

JB Hi-Fi, whose group includes home electrical retailer Good Guys, released a third-quarter trading update on Wednesday, showing strengthening sales into March and April as well as solid growth for its online stores. The online growth mirrored reports from other retailers such as Adairs, Kathmandu, Woolworths and Coles that showed an increase in online sales as isolation measures took hold.

JB Hi-Fi also said it had received credit approval for an additional $260m of committed short term debt facilities on favourable terms. “The group does not currently anticipate that these facilities will be required to be drawn upon but considers it prudent to secure these additional facilities in this uncertain environment.”

JB Hi-Fi said same store sales growth of around 9 per cent from January to March had now shifted up a gear to more than 11 per cent from March to April as customers prepared for a potential increase in government restrictions.

For its flagship Australian JB Hi-Fi stores, same store sales rose 11.3 per cent in the third quarter, with total sales up 11.6 per cent. Year-to-date same store sales were up 6.4 per cent.

For JB Hi-Fi in New Zealand, third-quarter same store sales were down 3.3 per cent. It’s New Zealand stores were closed from late March.

In Australia, the Good Guys chain also benefited from consumers buying up before isolation and lockdowns occurred, with same store sales for the third-quarter and total sales up 13.9 per cent. Year-to-date same store sales were up 4.9 per cent.

“The group has seen strong sales growth in Australia continue into April and early May as JB HI-Fi and The Good Guys continue to provide customers with the home appliances and technology products they need for working, learning and entertainment while at home,” the company said.

The JB Hi-Fi Australia business had closed three airport stores and seven stores in CBD locations in response to the shift in foot traffic away from these locations, the company said.

Staff from these locations had been redeployed across the store network. All Good Guys stores remained open.

“Performance across both brands has remained strong with elevated sales growth driven by homemaker and freestanding stores and a significant acceleration in online,” the company said.

JB Hi-Fi said it was pleased with how its online businesses had scaled and maintained a high level of customer service and on-time delivery, during a period of significantly increased volume. “Both JB HI-FI and The Good Guys will continue to monitor and evolve their store, commercial and online offerings in line with changes to customer shopping habits.”