KEY POINTS:
JB HI-FI
JB Hi-Fi (JBH in Australia) posted a 60 per cent rise in first-half profit to a record A$41.9 million ($48.8 million) after sales jumped 50 per cent to A$989 million.
The electronics retailer upgraded its profit guidance for the full year, expecting a 40 per cent rise in sales to about A$1.8 billion, compared with its previous forecast of A$1.7 billion. Profit is set to rise between 41 per cent and 49 per cent to between A$57 million and $60 million.
Ignoring signs of a slowdown in consumer spending, JB Hi-Fi has promised to open 65 new stores in Australia and New Zealand over the next five years to take the empire to 150 stores from 86 outlets.
Its recent earnings were surprisingly good; but the share price, which had already fallen steeply, fell further. This is a reflection of the market's fear for all things retail.
AIR NZ
Imagine you own shares in a company that reported a 62 per cent increase in profit and was sitting with $1.2 billion cash in the bank - and the share price plunges.
That is the story of Air New Zealand, which reported a solid first-half performance with high loadings despite increased competition and record jet-fuel prices.
In the six months to December 31, it increased its pre-tax earnings by 62 per cent, to $159 million, on the comparable period last year. The company has been adding new routes that offer the greatest growth and profit potential and dumping the unprofitable ones.
But the entry of new competition into the New Zealand domestic market has meant that capacity has run ahead of growth in demand on the main trunk routes.
Many investors believe the competition is too tough and costs too high in airlines to warrant any investment.
