Joe Hockey's small businesses tax cuts and Australia's housing boom have got the cash registers in overdrive at electronics retailer JB Hi-Fi.
The electronic and home appliances retailer posted a stronger-than-expected annual net profit of $136.5 million and flagged stronger sales for the year ahead.
The result was largely driven by a 7.4 per cent rise in sales in the second-half as shoppers splashed out on smart phones, computers, fitness devices and home appliances.
Chief executive Richard Murray says the federal government's $20,000 instant asset write-offs for small businesses, announced in the May budget, had been keeping the retailer's cash registers ringing.
"Post the federal budget, it was a strong period for computers and telcos (smart phones and accessories) driven by the small business tax incentives," he said.
"June was a solid month cycling a pretty ordinary June in the prior year; one budget was a hindrance and one budget presented an opportunity."
Treasurer Joe Hockey's first budget in 2014 dented consumer confidence and retail sales generally after he unveiled a raft of funding cuts.
But a year later, consumers are feeling more confident.
Mr Murray said July has also been a solid month with same store sales up 5.7 per cent and total sales up 7.6 per cent.
Significant sales growth across the telecommunications, fitness, accessories, computers, IT and home appliance categories had offset weaker sales of televisions, music, movies and games.
The retailer has forecast sales to rise about 5.5 per cent to $3.85 billion in the current financial year.
Key to its future growth plans is the rollout of its JB Hi-Fi HOME stores, which sell a range of home and kitchen appliances.
The retailer has also begun introducing small appliances into its existing stores as part of its push into the $4.6 billion home appliance market.
Morningstar analyst Farina Parsons said this was a smart move timed to capitalise on the booming housing markets in Sydney and Melbourne.
"Home appliances is a growing category on the back of strong housing, which JB has been benefiting from as well as from the small business tax incentives," she said.
"The results were very solid and investors should be pleased."
The retailer plans to open six new JB Hi-Fi HOME stores and convert 16 existing stores into the new format across Australia and New Zealand in fiscal 2016.
Meanwhile, the retailer will launch a $15.2 million buyback of 776,610 later this year.
Shares in JB Hi-Fi climbed $2.08, or 10.61 per cent, to $21.69.
FEDERAL BUDGET GIVES JB HI-FI A SALES BOOST
* Full year profit up 6.35pct to $136.5m
* Revenue up 4.8pct to $3.65b
* Fully franked final dividend up two cents to 31 cents
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