JB Hi-Fi post-stimulus fall

SYDNEY: JB Hi-Fi confirmed its guidance but said sales for March and April were below expectations as the electronics retailer felt the fading effects of the government stimulus and interest rate rises.

In a presentation to the Macquarie Australia Conference yesterday, the company said comparative store sales in the third quarter were positive, unlike many other retailers.

However, sales for March and April were behind internal expectations.

"In hindsight, the Government stimulus package supported sales last year more than we anticipated," the company told the presentation.

"We remain cautious that recent interest rate rises are impacting consumer spending."

On Thursday, Australian Bureau of Statistics (ABS) data showed that retail sales rose by just 0.1 per cent in the March quarter for a 12-month growth to March of 1.2 per cent - the weakest annual figure since July 2001.

But JB Hi-Fi expects the difficult economic conditions will be somewhat offset by the positive impacts of higher growth and lower unemployment.

The retailer hopes that fourth-quarter sales should benefit from the release of the Avatar game and movie, 3D TV launch and the World Cup build up.

The company reconfirmed sales guidance of about A$2.8 billion ($3.5 billion) and net profit of between A$117 million and A$120 million.

The retailer also told the conference that its CEO transition was going smoothly. In early February, the company announced that chief executive Richard Uechtritz would retire after 10 years in the role to be succeeded by operations chief Terry Smart.

"Mr Smart is now fully engaged in all areas of the business," chairman Patrick Elliott said in a statement.

Uechtritz will retire at the end of May but will consult to the company until the end of calendar year 2013.

"We look forward to Mr Uechtritz joining the board as a non-executive director in early 2011," Elliott said.

- AAP