Jb Hifi
Company Overview
JB Hi-fi was established by John Barbuto (JB) in 1974 and opened its first shop in Melbourne. In 1983, it was sold to Bouris and Rodd who expanded the company and, later on, sold the majority of their holding to a private equity, Next Capital Pty Limited. The company’s share was floated in Australian Stock Exchange in 2003 at IPO price of $1.55.
JB Hi-Fi, has diversified its business from predominantly selling music CDs, and is now a major retailer for televisions, audio/visual, photography, portable audio, in-car entertainment, computer/video games, DVD movies, gadgets and information technology equipments.
By 30 June 2009, the company currently has 123 stores in Australia and New Zealand and management has reiterated its intention to continue expanding and opening more stores to support company’s growth.
JB Hi-fi (JBH) Free Cash Flow to the Firm 2005 -2009 (Historical) 2005 2006 2007 2008 2009 $ '000 $ '000 $ '000 $ '000 $ '000
Sales 693,943 945,821 1,281,837 1,828,564 2,327,266
EBIT* 34,649 44,538 65,564 102,249 141,967
Taxes 9,442 11,954 18,003 28,875 41,055
Depreciation 5,268 7,439 10,854 14,741 18,749
Capex 20,142 29,046 36,528 51,573 44,429
Change in NWC 14,859 23,420 15,355 17,017 11,730
FCFF** (4,526) (12,443) 6,532 19,525 63,502
*EBIT = Net Income – Taxes – Net Interest Expense (Income)
**FCFF = EBIT – Taxes + Depreciation – Capex - Change in NWC
JB Hi-Fi (JBH) Free Cash Flow to the Firm 2010 -2015 (Forecasted) 2010 2011 2012 2013 2014 2015 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000
Sales 2,961,978 3,769,795 4,585,433 5,330,520 5,922,235 6,288,229
EBIT 157,037 199,865 243,108 282,611 313,982 333,386
Taxes 47,111 59,960 72,932 84,783 94,195 100,016
Depreciation 18,957 19,168 19,381 19,597 19,815 20,035
Capex 46,113 47,861 49,675 51,558 53,513 55,541
Change in nwc 7,513 8,063 8,654 9,288 9,969 10,699
FCFF 75,257 103,150 131,228 156,578 176,121 187,165
Our Assumptions
Company Forecast
Several
JB Hi-fi was established by John Barbuto (JB) in 1974 and opened its first shop in Melbourne. In 1983, it was sold to Bouris and Rodd who expanded the company and, later on, sold the majority of their holding to a private equity, Next Capital Pty Limited. The company’s share was floated in Australian Stock Exchange in 2003 at IPO price of $1.55.
JB Hi-Fi, has diversified its business from predominantly selling music CDs, and is now a major retailer for televisions, audio/visual, photography, portable audio, in-car entertainment, computer/video games, DVD movies, gadgets and information technology equipments.
By 30 June 2009, the company currently has 123 stores in Australia and New Zealand and management has reiterated its intention to continue expanding and opening more stores to support company’s growth.
JB Hi-fi (JBH) Free Cash Flow to the Firm 2005 -2009 (Historical) 2005 2006 2007 2008 2009 $ '000 $ '000 $ '000 $ '000 $ '000
Sales 693,943 945,821 1,281,837 1,828,564 2,327,266
EBIT* 34,649 44,538 65,564 102,249 141,967
Taxes 9,442 11,954 18,003 28,875 41,055
Depreciation 5,268 7,439 10,854 14,741 18,749
Capex 20,142 29,046 36,528 51,573 44,429
Change in NWC 14,859 23,420 15,355 17,017 11,730
FCFF** (4,526) (12,443) 6,532 19,525 63,502
*EBIT = Net Income – Taxes – Net Interest Expense (Income)
**FCFF = EBIT – Taxes + Depreciation – Capex - Change in NWC
JB Hi-Fi (JBH) Free Cash Flow to the Firm 2010 -2015 (Forecasted) 2010 2011 2012 2013 2014 2015 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000
Sales 2,961,978 3,769,795 4,585,433 5,330,520 5,922,235 6,288,229
EBIT 157,037 199,865 243,108 282,611 313,982 333,386
Taxes 47,111 59,960 72,932 84,783 94,195 100,016
Depreciation 18,957 19,168 19,381 19,597 19,815 20,035
Capex 46,113 47,861 49,675 51,558 53,513 55,541
Change in nwc 7,513 8,063 8,654 9,288 9,969 10,699
FCFF 75,257 103,150 131,228 156,578 176,121 187,165
Our Assumptions
Company Forecast
Several