SYDNEY--Electronics retailer JB Hi-Fi reported a 6% rise in annual profit but said recent sales in Australia had weakened as consumers grapple with higher interest rates and swings in fuel prices resulting from the Middle East conflict.

JB Hi-Fi said its net profit totaled 489.9 million Australian dollars (US$347.1 million) in the 12 months through June, up from A$462.4 million a year earlier. Earnings before interest and tax rose 5.8% to A$734.4 million.

Annual sales were A$11.06 billion, lifting from A$10.55 billion in fiscal 2025, led by computers, mobile phones and fitness tech, among other products. Still, JB Hi-Fi said fourth-quarter sales growth in Australia was affected by supplier price rises and shortages of some tech products, as well as having to measure up against the period a year earlier when new products were released.

Directors of JB Hi-Fi declared a final dividend of A$1.27 a share, representing the first payout under the company's revised policy that aims to return 70-80% of net profit. It said the annual payout ratio was 75% of net profit.

"In an uncertain retail environment where customers are seeking value, our brands continued to resonate and our teams continued to execute to a high standard," said Chief Executive Nick Wells.

JB Hi-Fi's sales performance is closely watched as a barometer of how demand for electronics and household appliances are holding up at a time of broad cost-of-living pressures in Australia and New Zealand because of inflationary pressures stoked by hostilities in the Middle East. Analysts warn that consumers tightening their budgets are less likely to make discretionary purchases, although the hit to demand could be different depending on category.

JB Hi-Fi said sales at its own-name stories in Australia fell by 1.4% in July on a comparable basis. It also reported a 1.7% fall in same-store sales at The Good Guys.

In New Zealand, where the central bank has begun raising interest rates to tame inflation, JB Hi-Fi said same-store sales at its stores rose 11.7% in July.

"The group continues to see variability in trading, with customers increasingly looking for value and migrating their spend to key promotional events," JB Hi-Fi said. "In the technology categories, sales growth continues to be impacted by supplier price rises and stock availability."