Sales rise at JB Hi-Fi, The Reject Shop

Sales rise at JB Hi-Fi, The Reject Shop

"Essential services" is a term that has become the new holy grail for Australian retailers amidst the pandemic, and two companies that have benefited include JB Hi-Fi (ASX: JBH) and The Reject Shop (ASX: TRS).

JB Hi-Fi, which also owns home appliances retailer The Good Guys in addition to its eponymous electronics stores, reported year-on-year sales growth of 9.1 per cent in Australia between 1 January and 22 March.

Sales growth at The Good Guys was higher still at 10.4 per cent, but JB Hi-Fi sales were down 2 per cent in New Zealand.

"The Company continued to see strong momentum in Australia through the quarter, with an acceleration in recent weeks as both JB HI-FI and The Good Guys provided retail and commercial customers with the essential products they need to respond to and prepare for COVID-19," the company said in an update this morning.

These essential products include technology products that enable remote working, learning and communication, and essential home appliances for food storage and preparation.

Despite the positive sales scenario, uncertainty arising from the Covid-19 outbreak has led the company to withdraw its guidance for FY20.

The Reject Shop has announced a material increase in sales driven by customer concerns around coronavirus over the past four weeks.

Comparable sales for the first 12 weeks of the second half of FY20 now sit at 8.2 per cent for TRS.

But this figure belies a more sudden spike in the last week alone, as for the first 11 weeks the year-on-year growth rate was much lower at 5.7 per cent.

Comparable sales for the week between 16 March to 22 March 2020 were 36.1 per cent, driven by strong category performances in groceries, cleaning, toiletries and pet care.

"In these extraordinary times, The Reject Shop will continue to serve all Australians through providing access to essential grocery and household products at everyday low prices while doing everything we can to keep our customers and our team safe and healthy," says TRS chief executive officer Andre Reich.

Updated at 9:54am AEDT on 23 March 2020.

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