Accounting Business Reporting for Decision Making

CHAPTER 8 Analysis and interpretation of financial statements 325

Note

Consolidated Change

A

2015

$’000

B

2014

$’000

C

$’000

D

%

Attributable to:

Owners of the company

Non-controlling interests

136 511

—

128 359

88

8 152

88

6

100

136 511 128 447 8 064 6

Earnings per share

Basic (cents per share)

Diluted (cents per share)

23

23

137.91

136.46

128.39

126.89

9.52

9.57

7

8

FIGURE 8.2 JB Hi-Fi Ltd statement of profit or loss

Source: Adapted from JB Hi-Fi Ltd 2015, preliminary final report, p. 56.

Columns C and D of figure 8.2 respectively show the dollar change and percentage change for items

affecting JB Hi-Fi Ltd’s profit. The entity’s profit attributable to equity holders of the parent is up by

$8.1 million (6 per cent). Its gross profit is up $42.3 million (6 per cent) reflecting the increase in sales

revenue (up $168.4 million, 5 per cent) in 2015, outstripping the increase in the cost of sales. The higher

sales are associated with the roll-out of JB Hi-Fi Home branded stores, new stores, maturing of previously

opened stores and growth in online operations. Consistent with higher sales volumes, the cost of sales

increased by $126.1 million (5 per cent) and sales and marketing expenses associated with generating

higher sales were up $18.4 million, 5  per  cent). Occupancy expenses also increased (up $11.2 million,

8 per cent) and this may be attributable to factors such as higher store rents and higher utility charges. The

finance costs (down $2.9 million, 33 per cent) were lower in 2015 due to lower borrowings.

Analysing the change in the numbers reported in the cash flow statement (figure 8.3) reveals that

JB Hi-Fi Ltd’s cash at the end of the 2015 year was $5.7 million higher (up 13 per cent) than it was

at the start of the year. Net cash flows from operating activities increased by $138.6 million (335 per

cent). Investing activities used net cash in 2015 of $44.4 million compared to $38.2 million in 2014, an

increase of $6.1 million (16 per cent). JB Hi-Fi Ltd’s payments for property, plant and equipment were

higher in 2015 relative to 2014. The company’s financing activities in 2015 resulted in a net outflow of

$129.6 million compared to a net outflow in 2014 of $27.6 million (up $102.0 million). This increase in

outflow relates to the repayment of borrowings.

Consolidated Change

Note

A

2015

$’000

B

2014

$’000

C

$’000

D

%

Cash flows from operating activities

Receipts from customers

Payments to suppliers and employees

Interest and bill discounts received

Interest and other costs of finance paid

Income taxes paid

4 012 120

(3 767 211

552

(5 689

(59 886

)

)

)

3 832 979

(3 723 982

402

(7 496

(60 577

)

)

)

179 151

43 229

150

(1 807

(691

)

)

5

1

37

(24

(1

)

)

Net cash inflow from operating activities 32 179 896 41 326 138 570 335

Cash flows from investing activities

Acquisition of non-controlling interest

Payments for property, plant and equipment

Proceeds from sale of plant and equipment

12 (2 400

(42 466

496

)

)

(3 000

(35 914

674

)

)

(600

6 552

(178

)

)

(20

18

(26

)

)

Net cash (outflow) from investing activities (44 370 ) (38 240 ) 6 130 16

FIGURE 8.3 JB Hi-Fi Ltd statement of cash flows (continued)