The State of the Industry - Australia Australia’s domestic consumer electronics devices market,...
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The State of the Industry - Australia
Australia’s domestic consumer electronics devices market, defined as including computing devices, mobile handsets, and video audio, home entertainment, domestic appliances and gaming products, is projected to be worth around US$12.2bn.
In 2009, with the government stimulus handouts and lower interest rates is having a positive effect on driving growth.
Retailers predict continued sales growth but with margins under pressure.
Australian Economy Coupled to Asia
Australia's Top Ten Export Markets
Japan23%
China15%
Republic of Korea9%India
6%
Other26%
United States6%
New Zealand4%
United Kingdom4%
Taiwan4%
Singapore3%
Japan
China
Republic of Korea
India
United States
New Zealand
United Kingdom
Taiwan
Singapore
Other
Japan, China South Korea & India account for >50% of AUST exports
Harvey Norman – 98 stores
Harvey Norman retail sales for the three months up to 30 September 2009 rose 4.3 per cent,
Mr Harvey, the chairman, said that Harvey Norman would have a "positive future" and added that it was increasing market share in “all key product categories”.
Management said there was a "significant improvement" in net profit from underlying operations in the second half of the year.
IG Markets analyst Cameron Peacock said: "The Harvey Norman result, while slightly down on last year, is clear confirmation that analysts became too pessimistic about the health of consumers and certainly underestimated their
resilience.”
Harvey Norman's franchisee sales revenue was $5.06 billion, up from $4.86bn, while company-owned sales revenue was $1.44bn, compared with $1.43bn in fiscal 2008.
Despite the growth in sales, full-year earnings before interest and taxes from continuing operations fell 31 per cent to $383m, from $555.1m last year.
Management said margins at Harvey Norman, franchisees in Australia remained under pressure.
JB Hi FI – 130 storesHOME entertainment retail chain JB Hi-Fi has reported a surge in consumer spending and is tipping a strong
Christmas trading season as shoppers shrug off the impact of higher interest rates.
Sales growth for existing JB stores had increased over the past six weeks from 3.8 per cent in mid-August to average 8.4 per cent for the whole of the first quarter
The company expected another year of sales and earnings growth and said fiscal 2010 sales should be around $2.8 billion, up 20 per cent on year
Government stimulus cheques helped support consumer spending in the first half of the year but that money had largely worked its way through the system by July, so positive sales trends in recent weeks were an
encouraging sign for the retailer.
Home entertainment continues to become more of a staple category as consumers embrace technology."
Home entertainment products continued to be popular with consumers, despite the broader economic slowdown, JB Hi-Fi said. For the most part, retailers in the clothing, department store and supermarket
sectors have been reporting sales growth for the year.
The company raised its target payout ratio to 50 per cent of earnings to reflect "continued strong cash flows from existing stores" as well as "overall company growth".
Expected timing for improvement in business conditions
0
5
10
15
20
25
30
Alreadyunderway
Thirdquarter2009
Fourthquarter2009
Firstquarter2010
Secondquarter2010
Thirdquarter2010
Fourthquarter2010
Per
cent
age
of c
omp
anie
s
Total Services
Around 40 per cent of businesses expected an improvement in business conditions before the end of the year.
Services firms were the most likely to believe an improvement in conditions was already underway.
Fiscal and monetary policy stimulus appears to have had an impact in the sector.
Sector Performance & Trends
Data for some key CE product sectors
Product sales and market trends:> Small Kitchen Appliances> Air Conditioners> Flat Panels, DVDs & Set Top Boxes> Vacuum Cleaners> Personal Care> Cordless Phones> Interactive Games
Small Kitchen Appliances + 5.1%
Small Kitchen Appliances
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
Units
2008
2009
Air Conditioners + 4.1%
Air Conditioners
0
100,000
200,000
300,000
400,000
500,000
600,000
Portable SingleWindow Type
Split WallMounted
Other Types TOTAL
Units
2008
2009
Flat Panels, DVDs & Set Top Boxes + 141%
Digital TV Panels & Receivers
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
LCD Plasma PVR DVD-PVR
Blu-RayPVR
SD-STB HD-STB TOTAL
Units
2008
2009
Vacuum Cleaners + 6.7%
Vacuum Cleaners
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
Units
2008
2009
Vacuums - Bagged vs Bagless + 4%
Vacuums - Bagged vs Bagless
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
Bagged Both Bagless TOTAL
Units
2008
2009
Personal Care + 9.4%
Personal Care
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000Units
2008
2009
Cordless Phones - 4%
Cordless Phones
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
DECT DSS WDECT WLAN Analogue Others TOTAL
Units
2008
2009
Interactive Games
In 2007-08 Sales of Video & Computer games is worth $1.5 Billion (AUD) an increase of 53% on the previous financial year
The Interactive Entertainment Association of Australia:
Ai Group’s Strategic Position
The strategic objectives of Ai Group’s electronics industry development agenda are to:
identify, improve and develop the capability of the electronics industry; promote a high level of communication, networking and cooperation in the electronics industry;
optimise the interaction and cooperation between government and the electronics industry;
promote greater involvement in national and global markets and increase the level of technology diffusion through global alliances; and
identify industry skills requirements and improve training and education programs.