Listed retail chain, JB Hi-Fi (ASX: JBH), is defying the shaky economic climate and forecasting a 58 per cent increase in profit for the current financial year.
The company has upgraded its profit guidance figure to $64 million for the year ending June 30, a significantly increase on the previous year's net profit of $40.4 million. The previous guidance figure was set between $57 to $60 million. The retailer is also expecting 30 per cent sales growth.
Despite a slow down in consumer spending, CEO, Richard Uechtritz, said it had a pretty strong business model.
"We're not totally in the electrical business, we're also in home entertainment and technology. I think that area of discretionary expenditure has given a little bit more priority than some other areas," he said.
Positive contributors to growth included games, computers and audiovisual, which includes MP3 players and flat screen televisions, Uechtritz said.
In February, JB Hi-Fi launched its first dedicated IT and computer store in Victoria. Uechtritz said it did not plan to establish more IT and computer dedicated shop fronts.
Uechtritz forecast a tough year ahead for all retailers.
"We're focused on keeping our retail formula as it is and doing all the right things that we need to do to be successful," he said.
JB Hi-Fi planned to add another 24 stores nationally over FY09, Uechtritz said, the largest amount of stores the retailer has opened in a year. It currently has 88 stores across Australia and New Zealand.
The company expects to reach $2.35 billion in sales in FY09, making it the sixth largest local retailer ahead of David Jones and sitting behind Woolworths, Wesfarmers, Harvey Norman, Myer and Aldi.