Good morning and welcome to the JB Hi-Fi 2024 Annual General Meeting. My name is Stephen Goddard. I'm Chairman of the JB Hi-Fi Group, and I am your Chair for today's meeting. We have a quorum, and I am pleased to declare the meeting open. This year sees our third hybrid AGM, and I'm delighted to be able to extend a warm welcome to our shareholders, proxies, and guests who are attending either in person or through our online meeting platform. Our meeting is being held on the lands of the Wurundjeri people of the Kulin Nation, and I wish to acknowledge them as the traditional custodians. I would also like to pay my respects to their elders, past and present.
I would like to introduce my fellow directors: Beth Laughton, Christy Boyce, Mark Powell, Geoff Roberts, Melanie Wilson, Richard Uechtritz, and our Executive Directors, Terry Smart and Nick Wells. Our Company Secretary, Doug Smith, is also in attendance, as is Suzana Vlahovic of Deloitte Touche Tohmatsu. Obviously, as some attendees are attending online, there is a risk of technical difficulties. If this happens, it will be at my discretion whether we continue the meeting or postpone or adjourn the meeting. The agenda for today's meeting is as follows: procedural issues, summary of items and business, and voting opens, Chairman's address, Group CEO's address, further information on each item of business, including hearing from the directors standing for re-election, and disclosure of proxy votes already received on each item, questions, voting clauses, close of meeting.
The notice of meeting dated 13 September 2024 has been made available to all shareholders, and I will take it as read. I'll start by briefly setting out how the meeting will work. All shareholders and proxies attending the meeting, whether in person or online, have the ability to ask questions and submit votes. Noting that questions may be submitted at different times by online participants and participants in person, we will answer questions on all items of business later in the meeting. For those attending the meeting online who wish to submit a written question, you may do so at any time during the meeting via the Q&A icon on your screen.
Type the question in the text and then press the send button. I will address your question at the relevant time. If you're attending in person or attending online but wish to ask a question verbally, please wait until that time to ask your question. Voting today will be conducted by way of a poll on all items of business, and Computershare will act as the independent returning officer. In order to provide you with enough time to vote, I will shortly open voting for all resolutions. For those attending the meeting online and who are eligible to vote, when the poll opens, a voting icon will be available on your screen.
Selecting this icon will bring up a list of resolutions and present you with voting options. To cast your vote, simply select one of the options. There is no need to hit submit, as the vote is automatically recorded. Please ensure you cast a vote for all resolutions. You will receive a vote confirmation notification on your screen. To change or cancel your vote, click the link, click here to change your vote at any time until the poll is closed. Votes may be changed up until the time that I declare voting is closed. For shareholders, proxies, and corporate representatives attending in person, you vote by either scanning the QR code that you received upon admission and following the instructions, or by completing the yellow voting card that was provided to you upon admission.
White cards are for visitors only who cannot vote or ask questions today. Shareholders with a green card are not entitled to vote on the items of business. You can vote at any time after voting opens, and I will warn you before I close voting at the end of the meeting. Results of voting will be released to the ASX after the meeting. If you have any difficulties voting or submitting questions, please consult the online meeting guide, which can be accessed within the online platform or on the JB Hi-Fi Investors website if you're attending online, or raise your hand if you're attending here in person.
The items of business for the meeting are set out in the notice of meeting and are as follows: Number one, to receive and consider the financial and other reports for the financial year ended 30 June 2024. Number two, to vote on the re-election of directors. Number three, to adopt the remuneration report. Four, to approve the allocation of restricted shares to each of the executive directors. And five, to approve an increase in the fee pool for the non-executive directors. I'll provide more detail on each of these later in the meeting. I now declare voting open on all items of business. The voting tab will soon appear. Please submit your votes at any time. And as I say, I'll give you a warning before I close voting. We now move to my Chairman's address.
The financial year ended 30 June 2024 was another strong year for JB Hi-Fi Limited and its subsidiaries, with sales remaining solid thanks to the strength of each brand's core categories. In this tough retail environment where customers are seeking value, our brands continue to resonate strongly, driven by the trust customers have in our low-price, best-value proposition. We are thankful to our over 15,000 team members across Australia and New Zealand, whose continued focus on delivering value and maintaining our high levels of customer service will ensure the ongoing success of our business. Our motivated, passionate, knowledgeable, and highly trained staff continue to be our most important asset. We believe the Group is an employer of choice with a diverse, inclusive, busy, enjoyable, and most importantly, safe working environment that helps us to continue to attract and retain high-caliber people.
Turning to the Group's operating model, the Group comprises three leading retail brands: JB Hi-Fi with a focus on technology and consumer electronics, The Good Guys with a focus on home appliances and consumer electronics, and from September 2024, E&S with a focus on premium home appliances and bathroom. The value proposition for each brand centers around ranging the best brands at low prices, supported by exceptional customer service across our store network, our online and phone channels, and through our commercial business. The multi-branded retail approach continues to be underpinned by four key competitive advantages, being scale, a low-cost operating model, multi-channel capability, and people and culture.
An integral part of the Group's ongoing strategy is to encourage innovation and diversification in our product range, merchandising formats, advertising, supply chain, property locations, and our online offer in a controlled and responsible manner to ensure that we remain current and relevant to our customers. We have a culture of embracing change, which is seen as a natural part of our business, and this approach provides opportunities to increase revenue, margin, and productivity. The Group's FY 2024 Sustainability Report, which can be found on the Group's investor website, outlines our commitment to having a positive impact on our people, our community, and our environment.
As set out in the report, we are committed to supporting our people and ensuring a safe, inclusive, and respectful workforce while always looking for ways to provide them with flexibility and opportunities to grow and develop, making a positive impact in the communities in which our team members live and work, and working with our supply partners to protect and further human rights, and minimizing the impact that our operations may have on the natural environment and proactively reducing our waste, energy consumption, and emissions.
Progress made during FY 2024 within our key areas of focus included the following: continued improvement of gender diversity across the Group with an increase in the number of women in leadership positions at board, senior management, and store management levels, continued investment in leadership development that included launching a new women in leadership program in Australia and New Zealand,
ongoing focus on safety, including mental health and well-being, psychosocial hazard, and aggressive customer training programs, solar power generation installed in seven stores, bringing the total number of stores to 30, and added green power to the Group's energy mix as we continue to work towards net zero direct Scope 1, Scope 2 carbon emissions by 2030, completed the implementation of battery, mobile phone, and small e-waste recycling kiosks in JB Hi-Fi Australia and The Good Guys stores, and FY 2024 workplace giving donations totaling AUD 4.2 million and AUD 39.9 million since inception.
We're pleased with the progress we're making on our sustainability plan and commitments, and importantly, are receiving an overwhelmingly positive response from our team members. In closing, the Board remains focused on building long-term shareholder value. Since JB Hi-Fi listed in October 2003, the JB Hi-Fi share price compound annual growth is 20.1% to 29 October 2024, compared to 4.5% on the ASX 200 index over the same period. The earnings per share compound annual growth rate is 18.6%, and the ordinary dividend per share fully franked compound annual growth rate is 19.7%. More recently, in the five years since 2019, the JB Hi-Fi share price compound annual growth rate is 16.4% to 29 October 2024, compared to 4.1% on the ASX 200 index over the same period. The earnings per share compound annual growth rate is 13%.
The ordinary dividend per share fully franked compound annual growth rate is 12.9%, and the Group has returned an additional AUD 337.5 million to shareholders through the April 2022 AUD 250 million off-market buyback and August 2024 AUD 87.5 million special dividend. I would like to take this opportunity to thank my fellow directors, the executive team, and our store, warehouse, and support teams for their unwavering commitment to the ongoing prosperity of your company and its shareholders. I now invite Terry to address the meeting on the Group's operations.
Thank you, Stephen, and good morning, ladies and gentlemen. Retailing is a dynamic and exciting industry, and JB Hi-Fi, The Good Guys, and E&S are market leaders in their respective sectors. The core to our proposition has always been and will always remain our unwavering focus on customers who turn to us for their technology and home appliance needs, and our over 15,000 dedicated and knowledgeable team members across Australia and New Zealand continue to respond and adapt in an amazing manner to make sure we meet these needs.
Turning to our FY 2024 results, FY 2024 was another strong year with Group sales of AUD 9.59 billion, Group EBIT of AUD 647.2 million, and earnings per share of AUD 4.014 per share. The total ordinary dividend for FY 2024 was AUD 2.61 per share, representing 65% of NPAT. In addition to the total ordinary dividend, the Group declared and paid a special dividend of AUD 0.80 per share, fully franked, or AUD 87.5 million. The Group's balance sheet continued to be strong with low financial and operating leverage and closing net cash of AUD 302.7 million at 30 June 2024.
The Group will continue to regularly review all aspects of its capital structure with a focus on maximizing return to shareholders whilst maintaining balance sheet strength and flexibility. Turning to FY 2025, in September 2024, we completed the acquisition of 75% of E&S. E&S was established in 1962 and has a premium offering across kitchen, laundry, and bathroom product segments. It comprises 10 stores in Victoria and online, plus one showroom in the ACT, delivering highly personalized customer service both pre and post-purchase. E&S has an established commercial offering in Victoria, servicing builders, developers, and architects, and with a recent opening in ACT. E&S has a highly complementary premium product offering, which will appeal to a new customer base, the commercial construction market focus, making it a strategically compelling addition to the Group.
Rob Sinclair will continue as Managing Director of E&S and will report directly to myself. While only early, we are pleased with the integration process to date, and we look forward to the continued success of the E&S brand and welcome Rob and the E&S team to the Group. In October 2024, we announced changes to our Group executive team with the appointment of Nick Wells as Group Chief Operating Officer.
With the Group's further expansion, Nick's new role will provide additional support to assist the growth of the brands. Furthermore, David Giansalvo has been appointed to succeed Nick Wells as Group Chief Financial Officer. Since 2016, David has been the Group General Manager, Analytics, and Planning, leading the Group's commercial finance function, as well as being actively involved in the Group's investor relations and M&A activities. We congratulate both Nick and Dave on their appointments.
Both Nick and Dave will report directly to myself, and all other Group execs will continue to report directly to me. Throughout FY 2025, the Group will remain focused on five key areas. Firstly, retail execution and value promotion. In a tougher retail trading environment, a strong retail execution is vital. We will focus on actively demonstrating and proving value to our customers, especially during key sales events like Black Friday and Boxing Day. At the same time, we'll leverage the efficiency of our operating model and focus on delivering exceptional customer service. Secondly, we'll focus on multi-channel growth. We will continue to extend our reach and attract more shoppers to the brands, both in store and online. Two new JB Hi-Fi stores and one Good Guys store will open in FY25.
We will continue to enhance our sales channels by growing our over-the-phone, chat, and video sales channels to meet customers' changing shopping needs, and we'll expand our JB Hi-Fi Perks and The Good Guys' Gold Service Extras membership program. Thirdly, New Zealand expansion. The expansion of our JB Hi-Fi New Zealand business continues, with five new stores targeted to open in FY 2025. In addition to the growth in our store network, we are developing our commercial sales capabilities and investing in our workforce and systems to support ongoing growth. We expect the growth in sales and increased scale will assist in improving gross margins and overall profit margins over time. Fourthly, commercial growth. Our commercial business remains an area of focus and an opportunity of growth for the Group.
We are actively growing our customer base across corporate, government, and education sector while further integrating with our retail business to drive customer lead generation and enhance the delivery experience. And fifthly, supply chain optimization. Our investment in building and maintaining a fit-for-purpose supply chain network is ongoing. We are focused on creating best-in-class customer experiences with a number of initiatives underway, including launching a new transport management system. In addition to this, we will optimize inventory flow over peak trade period to enhance stock availability and ensure staff safety. Turning to recent trading, the Group today provided sales update for the period 1st July 2024 to 30 September 2024. Total sales growth for JB Hi-Fi Australia was 4.9%, with comparable sales growth of 5%. Total sales growth for JB Hi-Fi New Zealand was 19.6%, with comparable sales growth of 2.7%.
And total sales growth for The Good Guys was 5.3%, with comparable sales growth of 5%. The Group is pleased with its Q1 FY 2025 sales and E&S sales for the month of September as we enter the important Q2 trading period. In closing, we remain committed to offering the best value and exceptional customer service to maximize our brand sales opportunities. As always, the results are a credit to our over 15,000 team members whose support and commitment ensures an ongoing success of the business. We will remain focused on our customer needs and continue to innovate as we navigate another uncertain year. I look forward to another exciting and successful year in FY 2025. Thank you.
Thanks, Terry. Turning back to the items of business, item one relates to the receipt and consideration of the financial and other reports for the financial year ended 30 June 2024. The company's annual report, which includes the financial report, director's report, and auditor's report, as well as the company's corporate governance statement, has been made available to shareholders. No formal resolution will be put to the meeting on this item, and I will take the reports as read. Shareholders and proxies may ask questions in relation to the reports later in the meeting.
Item two on the agenda relates to the re-election of Geoff Roberts, Richard Uechtritz, and Nick Wells as directors. Shareholders and proxies may ask questions in relation to these items later in the meeting and can vote at any time before I declare the voting closed. Item two A relates to the re-election of Geoff Roberts. Geoff was appointed to the Board in January 2021 and is a member of both the Audit and Risk Management Committee and the Remuneration and Nominations Committee.
Geoff is a non-executive director and honorary treasurer for both the Melbourne Cricket Club and the Walter and Eliza Hall Institute of Medical Research and is a non-executive director of Djerriwarrh Investments Limited. His executive career included 13 years as Group Chief Financial Officer of SEEK Limited and AXA Asia Pacific Holdings Limited, and 15 years as a partner with Deloitte, including as managing partner in Victoria. The Board considers Geoff to be an independent director. I'll now ask Geoff to say a few words.
Thanks, Stephen. Good morning, everyone. It's been an honor to be on your board for three years working with arguably the best executive retail management team in Australia. The background, as Stephen mentioned, I bring to the Board in particular is my listed Group Chief Financial Officer experience on two high-growth companies from different industries who grew strongly both organically and through acquisition.
I've also had experience of managing these growth companies through the challenges of the global financial crisis and COVID, including any related capital management. One of those companies, SEEK Limited, is also one of the leading online businesses and was an early adopter of AI in matching job seekers with jobs, which is very relevant to the future. I would appreciate your continued support in my re-election. Thank you.
Thanks, Geoff. The proxy votes received in advance of the meeting on this resolution are as follows. Item two B relates to the re-election of Richard Uechtritz. Richard has over 30 years' experience in retailing. He was co-founder of Australia's two leading photo chains, Rabbit Photo and Smiths Kodak Express, and was a director of Kodak (Australasia) Pty Ltd.
Richard led the management buy-in of JB Hi-Fi in July 2000 and was CEO and Managing Director until his resignation from these positions in May 2010. Richard rejoined the Board in April 2011 as a Non-Executive Director. He has also been a Non-Executive Director of Seven Group Holdings for the past 14 years and will retire from this role at their AGM in November 2024. The Board considers Richard to be an independent director. I'll now hand over to Richard to say a few words.
Thanks, Stephen. Background's pretty one-dimensional. It's retail, retail, retail my whole life. But I have to say it's been great to hopefully join the Board again because I have to differ with Geoff. He says, "Arguably the best retailers in the country." These guys are clearly the best retailers in the country, as demonstrated by the performance of the company over the last number of years. So it'll be great to be a small part of it going forward. Quickly, and I think most of you are across this, I've had over 40 years' experience in retail.
I was a co-founder and founder of two retail companies, one of which we took public. I was part of the management buy-in of JB Hi-Fi in 2000, becoming its CEO when we took it public in 2003. I've had public company experience as a CEO and director for near 40 years. I've had experience as a NED with this company and an ASX 50 company for the last 14 years. All this should allow me to continue to contribute meaningfully for the JB Hi-Fi Group going forward. Thank you. As I age, I need to read my speeches now because I don't do them that often. So thanks, Steve.
Thanks very much, Richard. The proxy votes received in advance of the meeting on this resolution are as follows. Item two C relates to the re-election of Nick Wells. Nick is the Group's Chief Operating Officer and is also an executive director. Prior to being appointed COO in October 2024, Nick was Group Chief Financial Officer for 10 years, overseeing the finance, property, risk, sustainability, and M&A functions and implementing significant strategic initiatives, including leading the acquisition of The Good Guys in 2016 and of E&S in 2024.
Before joining the Group in 2009, Nick was a manager at Deloitte, where he provided audit and assurance services to a broad range of companies, including a number of Australian retail businesses. Nick is not considered to be an independent director by the Board. I'll now hand over to Nick to say a few words.
Thank you, Stephen, and I don't have a lot to add other than what you said already. I have been with business for 15 years, 10 of those as CFO and more recently as COO. As Stephen said, I've been involved in a number of strategic initiatives over that time, and we have seen enormous growth in the company over that period as well, which I'd like to think I contributed to. I love the business. I love the company. I'm excited about the future for the business and look forward to continuing to serve as an executive director. Thank you.
Terrific. Thanks very much, Nick. The proxy votes received in advance of the meeting on this resolution are as follows. Item three relates to the adoption of the remuneration report, which is contained within the company's annual report. Further information, including information regarding voting on this resolution and the Two Strikes Rule, is set out in the notice of meeting. Please note that a vote on this resolution is advisory only and does not bind the directors or the company. Again, I'll take the report as read. Shareholders and proxies may ask questions in relation to the report later in the meeting and can vote at any time before I declare voting closed. The proxy votes received in advance of the meeting on this resolution are as follows.
Items four A and four B relate to the allocation of restricted shares to the executive directors, Terry Smart and Nick Wells. Further information, including the terms of the allocation and the associated KPIs, is set out in the explanatory notes included in the notice of meeting, and I will take that information as read. Shareholders and proxies may ask questions in relation to these items later in the meeting and can vote at any time before I declare the meeting closed. The proxy votes received in advance of the meeting on item four A are as follows. And the proxy votes received in advance of the meeting on item four B are as follows. Item five relates to the increase of the fee pool for non-executive directors by AUD 175,000 from AUD 1.5 million to AUD 1.675 million.
Further information is set out in the explanatory notes included in the notice of meeting, and I'll take that information as read. Shareholders and proxies may ask questions in relation to this item later in the meeting and can vote at any time before I declare voting closed. The proxy votes received in advance of the meeting on this resolution are as follows. Okay. We'll now take questions from shareholders. Questions submitted online and in writing will be read out by our Company Secretary, Doug Smith. To ask a question verbally online, please follow the instructions shown below the broadcast window on the online platform. Our Company Secretary will say your name and then direct you to ask your question.
If you have questions from the floor, please raise your hand and wait for the microphone to arrive, although I think we're probably going to ask people to stand at the microphone today, so if you just come forward to that, stating your name and the name of your organization, if applicable, and asking your questions. Questions will be answered by the relevant director or executive or by Susanna Vlahovic from our auditors. While time constraints may prevent us from answering all the questions, we'll do our best to address all the questions you have during the meeting, and after the questions, I will close voting, so let's take questions from the floor. Mike, you're closest, I guess.
Thanks, Stephen. Yes, I've positioned myself to be close. My name's Mike Robey. I'm a volunteer monitor for the Australian Shareholders' Association. Today I carry proxies for about 9 million in shares, AUD 9 million that is, not shares, which puts us just outside the top 20 shareholders. Look, first of all, may I congratulate JB's for a fantastic year. It's been very rewarding for shareholders, so they're very comfortable with you being probably the best retailer in the country. Just a couple of technical questions. There's a securities trading policy update delivered to the market that always spooks retail shareholders because they think some shady business must have been going on. But perhaps an explanation of that first. And I've got a couple of other questions. Do you want me to just rattle them off or?
Let's do them one at a time. I think it's easier for people to understand if that's okay. Firstly, thanks, Mike, for your question. And also, Doug and I met with Mike and Steve from the ASA in advance of the meeting, and it's good of you to offer your time to do that. So we appreciate that engagement. The security trading policy simply outlines when employees of the company can trade in shares within the company. And typically, we have a blackout unless it's after results at half year, full year, or the AGM.
We simply updated the policy to include E&S as one of our trading businesses. And that was, I think, released two days ago to the ASX. So certainly no need to be spooked about that, Mike. It's a very, very simple matter, but a procedural one that we're required to undertake.
Thank you very much. Yeah. Well, that settles people down a bit. So the next one's really on diversity. We note lots of good words in the annual report about diversity. But in fact, you seem to be stuck on getting senior women into the senior positions in the company. You're at 27%, and it's not budging much in the last year or so. And you just have to compare yourself with really blokey companies like BHP who've managed to actually put targets in and actually meet them of much higher levels. And as one of our famous Chinese statesmen once said, "Women hold up half the sky." So it's about time we think that JB's gave them a better go. Now, we don't see much of what happens inside the company because it's all secret business.
I won't say secret men's business, but 73% secret men's business. But you do apparently have to report to the government agency on gender equality. It's a long report with lots of detailed questions. Do you publish that? And if not, would you be interested in publishing it so shareholders can see a little bit more detail on this, please?
Sure. Thanks, Mike. To answer this latter part first, yes, that's on our website. So if you go to the investor section and go to reports, you'll find that we release the full content of the WGEA report that we complete. Look, diversity is really important. I mean, we come from an industry that perhaps has been more male-oriented in its history. But as a company, we've undertaken some really important initiatives over the last number of years to level the playing field, to make it easier for people to advance based on talent rather than on gender. And we actually think we've made some pretty good strides.
So if you go back over the four-year period, our senior management team has gone from 18% female to 27%. A significant increase. It's not 50 or a number closer to 50. So we acknowledge that. In the last year, it moved up a little bit. I wouldn't call it stuck. I mean, we've had a successful period. And of course, it requires turnover for things to change and appointments to be made appropriately. But if you look at the number of store managers and area managers, it follows a similar pattern that we've made real progress in enabling women within our organization to move forward. We have a women in leadership program that's been instituted over the last couple of years, and that's become a very successful program as well.
People are judged for progression on merit on a competency-based system. And so we think this is an important matter for the longer term to make real progress, and we continue to make progress. It's not 50%, as I say, but we will work hard at it. We take it seriously as a board. Terry and Nick and the team take it very seriously. And I think if you talk to people within our business, they feel that the opportunities are there and they're recognized based on ability and talent.
Thank you. Yeah. So you've got targets?
Our target is to increase every year.
But no number?
We'll increase every year, and it's a long game. I mean, we want to appoint the right people to the right jobs based on their merit, and we want to give them the capacity for that to be the case.
So looking at the women on the board here, I think you're getting the message as well. So thank you very much for that response. Next one's on strategy. Nick is now COO into a strategic role. And pretty soon after that, the E&S acquisition, which we happen to think was brilliant, was announced. Are there more in the pipeline? Can we expect perhaps fewer give-backs in share price and more money spent on acquisitions?
Well, look, we look at things all the time. So Nick and his team and David Giansalvo, who's the new CFO, have spent a lot of time scouring the market, looking for opportunities. We are very careful to ensure that when we make an acquisition, it's done for the right reasons and can create long-term shareholder value, not just to buy a company to fill a revenue target or to fill a profit target over the next year or two. We think E&S is a terrific acquisition for all the reasons Terry talked about in his address. Nick was appointed for a couple of reasons. Obviously, as we move to potentially grow, the business acquisition opportunities may emerge.
We've certainly got nothing to announce in the short term. But we have a lot happening within our business. We've got growth opportunities within our retail business. We've got supply chain opportunities. Our online business is growing substantially. We're introducing a marketplace within JB Hi-Fi. We just need more management muscle to actually make those initiatives come to play. And that's really the proactive reason for Nick to be appointed to the COO role. And also, it gives opportunities for people like David, as the new CFO, to demonstrate what he can do. We have great confidence in our team. How many more, Mike? People? Why don't you do one more? Probably should be one more. We'll get to everyone. It's okay.
So this one's on remuneration. And we were one of the people that voted pretty much like you saw in the proxies that you've already produced, namely that we supported the remuneration report and actually voted against the two share equity issues. And the main reason is that you're kind of a role model in the retail market. You are undoubtedly the best retailer. And we're afraid that if we actually let people make long-term incentives without hurdles in the long term, which is the way your long-term structure is, you'll just encourage lots of other retailers to avoid long-term thinking. And we know that you are strategic. We know you think long-term. It's just that your LTI actually doesn't support that. Thank you.
Okay. Maybe just a quick overview of our remuneration structure. So our plan is based on a one-year target because that's the nature of our business. That's the DNA of JB Hi-Fi. We go past 30 June, we start a new financial year, and the entire team are focused on delivering that result. So that galvanizes the team to an achievable result to put all their energies into getting the best outcome we can for the company and for shareholders. The other part of the LTI is that if earnings are sufficient, then the management team are rewarded with a 25% cash bonus at the end of that year. But the other 75% is in shares at the end of year two, year three, and year four.
So management are incentivized to think like shareholders because they actually own the shares. So we have a long-term thinking process within our management team that once we get the result for the year in question, we've got to go and do it all over again. And the benefit that they receive in the shares is in line with what shareholders receive. So we think it's fit for purpose. I know it doesn't tick a box of having a short-term and a long-term incentive. We do think it's genuinely fit for purpose and the best way to run our business.
I take no responsibility for other retailers, Mike. That's their job if they want to look at us. But I don't think they do, to be perfectly honest. I think they run their own race. We're interested in our business, and it works really well for us. And frankly, I think we've had pretty good shareholder support because it's driven such good results in recent times. Thank you for your questions. I think you're next. Sorry. We'll get to everyone.
Thank you, Mr. Chairman. John Joyce is my name. First off, I'd like to thank the whole crew here for what you've done for us. I've been a long-time shareholder. I'm part of the bank of Mum and Dad. We get terrific cash flow from you, and that keeps the family going. So keep up the good work. Now to the questions. Can I ask the three of them?
Sure.
Number one, are you in danger of disruptors through online sales, reducing your profits in any way?
Do you want me to answer that question?
That's a question.
Okay. Fine. Firstly, John, thanks for your comments. We appreciate that, and we do our best for shareholders. Look, it's a competitive marketplace. Competition comes from everywhere. The best way for us to face them is to have an online offer that's as good or better. So Terry, do you want to just give a bit of color to that?
I agree. We've got to have that. Share my mics on. We've got to have an online offer that is, as Stephen has just said, as good, if not better. We've got to have delivery options, which are as good as the competition that are out there. A big difference when you look globally, especially in our categories, is in our retail in Australia, we negotiate price in store. You can negotiate over the phone. You can negotiate via chat. So it's that ability to negotiate. So when people are looking online, they're not just looking at it.
They know and have confidence. If they see a price online, there's a lot of confidence they're going to be able to actually get that price if they give us a call, send us a text, or come in the store. So that's a little bit of a protection mechanism that we do have against online.
Number two, Nick Scali reported a problem with delivery of product and so on, out of China or whatever, shipping problems, etc. We've got that under control. We don't have a problem with deliveries from overseas or product and so on.
Look, freight prices are increasing, but they would have their own product and be responsible for the entire supply chain. We work through our vendors, who actually are responsible for bringing the product into the country. In my experience, I'll hand to Terry in a moment. The ups and downs of price rises are generally taken by the supplier, and if there's a change over an extended period of time, we may see that influence the price. But if there's a spike for a little while, we tend not to see it. We only bring in a very tiny amount of private label product ourselves.
I think you just answered it well. The supplier wears that cost, so they would pass it on if it is an extended period, and therefore, the price goes up across the board, so all retailers would see a price increase.
Okay. We're not about to see it.
Not individually, would we see a price increase just for JB?
Is it no threat like what happened to Nick the other day, Nick Scali and so on?
No. There's no threat individually to us. Across the market, price may go up. It would be big and bulky items like Scali's is suffering with it if it happens. I'm not getting any feedback.
Thank you. Number three, you purchased E&S. I'm very encouraged by that because we have what, 12 stores or something or other. It looks like a growth opportunity for Nick here to rush around and get sites everywhere and get things going. The gentleman who advertises the thing is, "We will not be beaten on price on this routine." We're very encouraged by that. It looks like a good opportunity, Nick.
It's a really good business. It's complementary to us. So E&S is more premium in its brands. It's in the bathroom category. We don't play in the bathroom category. It has a big business with developers and unit developments and high-rise. And they do a lot of commercial work. So we think it's a complementary business. It's a Victorian-based business primarily, owned by Rob Sinclair. He's going to stay with the business for a number of years. He's very excited about the opportunity because if there is growth to be had, he knows that JB's got the money in the pockets to be able to fund that. So I think a really good opportunity. Nick's not bored, by the way. So he's got plenty of things that he's on his plate. But that's certainly one of them.
Okay. Thank you very much, Mr. Chairman.
Thanks, John. Appreciate your questions.
Thank you. Kevin Robinson. I'm a shareholder and a member of Team Invest.
Hi, Kevin.
And I'd just like to echo the congratulations on you as excellent retailers over the long term, very long term. We've been following this company for a long time. And my question is about the commercial section of the business. And I'm wondering how much you consider that to be part of your growth strategy. And also, companies like Data#3 cover the large corporate and government areas in a very integrated supply of hardware as well as software and consulting. And I'm just wondering how will you distinguish yourself in that market?
Commercial's important because it's a different target market. I mean, Terry, why don't you explain that?
Yeah. Look, we focus on those smaller, medium-sized businesses and selling hardware into those. So it is a little bit different to the company you're referring to, which is very much large sort of corporates, if you will, or probably big enterprise. So it's much more smaller, medium-sized companies that we're selling into.
Okay. Thank you.
Thanks, Kevin.
Greg Hoffman, proxy holder. I've traveled here from the Blue Mountains with my wife, Janine, and my son, Toby. Toby has the grand total of our shares in the grand total of one company, which is JB Hi-Fi. And although he's missing school today, we have traveled here because this company really is a masterclass. I've been investing for almost 40 years and a professional analyst for more than 25. And well, let's say bottom to top, this company is just exceptional. Janine was in the store on Monday and was delighted by the customer service.
So many customers are friends of ours and relatives of ours, very senior buyers for some global companies. One's a supplier in JB and is appropriately fearful every time they have to come and negotiate with JB. Another friend who's a buyer for an international chain. I said, "Is there any Australian company you would ever consider working for?" She said, "JB would be the only one." She said, "Those buyers know what their customers want before the customers know." And so top to bottom from the customers, obviously through your buyers, and then on the financial aspects, Terry put up those long-term charts, controlling the capital structure, keeping the share count amazingly flat over an extended period of time. So all of that growth, or the vast majority of that growth, flows through to shareholders.
The transitions of management and the board. Everything is just extraordinary. I'm so glad to hear some of the other shareholders appreciating that because it's so rare in the Australian landscape, really, to have a top-class outfit. Congratulations to you all on that. The question is around E&S, maybe just to hear more perhaps from Terry. Is it something that sits alongside the business and will run its own race? Or is there something that JB brings to the party to help accelerate its growth other than capital? Can it be a kind of third pillar in the business? Is that the way that the board sees it over the next five to 10 years? Or is it just more exploratory, take the opportunities as they come kind of situation?
Yeah. Look, we see it as a good growth opportunity within the business. What we've done, and we did it with The Good Guys, was we integrate a lot of the back-end processes, a lot of the back-end support, so that you can leverage the group power. But then anything that touches the customer, so think of marketing, think of operations, we leave within the brand. So we let them run their own race within that side of it. So JB does that. The Good Guys does it. And now E&S will do it. So we'll integrate the back-end.
We'll give them a lot of support. And they can leverage the sizable nature of the whole business now, but let them really function and run the business as they know best. Of course, we have all the oversights and all of that. But we purchase that business because it's a good business. We purchase The Good Guys because it was a good business. And we've got to be able to nurture that but give it appropriate back-end support.
Thanks for your question and making the trip. Toby, invest those dividends wisely, won't you? I'm not saying how. I wouldn't be allowed to. Any other questions from the floor? Okay. Any questions from online? Doug?
Yes. Thanks, Stephen. We've got a couple of questions online so far. Question from Stephen Mayne. Did any of the five main proxy advisors, ACSI, Ownership Matters, Glass Lewis, ISS, and ASA, recommend a vote against any of today's resolutions? If so, what reasons did they give?
Yes. ASA and ISS recommended voting against the allocation of shares. And you saw that vote was down around 71%. The other votes were well in excess of 90%. I can't really speak for them other than I think I covered this with the VRP in my dialogue with Mike. We think it's absolutely the right program and structure for our company, but it doesn't tick some boxes, and some people may say, "Well, let's not vote as an allocation for the shares to reflect that concern that they have." That's the best I think I can put it in words. I'm not asking you to respond, but I think that's how we understand the position of the ASA and ISS, and everything else was a vote for, and you saw the results of the voting.
Thanks, Stephen. Another question from Stephen Mayne. A few years ago, one of your cheap and cheerful physical stores in Computershare's sparse facility in Abbotsford. The then CEO claimed that you had the lowest ratio of rent to sales at just 2% because you tried to locate your stores in cheaper, grungy locations. These days, you seem to be in most of the 42 Westfields. What is the equivalent figure in 2024? And please provide a couple of examples of stores with very high rents but still perform well because of the traffic provided by that particular shopping center.
Oh, I don't think I'll get into details of store-by-store rent. You can see in our profit and loss statement there's an allocation in occupancy. And I think Stephen's asked that question before. I don't recall us. I think he said we boasted at one point. That's certainly not our style. Look, we are a low-cost business. We like to manage our costs as low as possible so we can reduce our prices and get the best possible outcome for our customers and ultimately our shareholders. Sometimes that means in productivity terms we're in centers owned by Scentre or Westfield. And we like to think we get a good deal. But we're certainly not going to disclose any specific terms on store-by-store locations. Doug, any other questions?
No, not at the moment. Thanks, Stephen.
Any more from the floor? Okay. Thank you, ladies and gentlemen. That's all the questions we have. If you haven't voted already, please cast your votes now. A reminder that for those attending the meeting online, you can vote by selecting the voting icon. For those attending in person, you can vote by scanning the QR code that you received upon admission or by completing the yellow voting card that was provided to you upon admission and holding it up for collections. So I'll just allow a couple of minutes for that to take place. Okay. We'll just take a few minutes now to allow you to finish voting.
Please complete your voting now and raise your hand if we don't have anything collected.
I think we're all good. Okay.
Terrific. Thanks, everyone. Voting is now closed. The voting results from the meeting will be released to the ASX later today. On behalf of the board, I'd like to thank you for participating in today's AGM. I now declare the meeting closed. I invite you to join the directors of the company for refreshments outside this room in the registration area near the left. So if you go all the way out and then turn right, and we'd be happy to have a cup of tea and enjoy your company. So thanks very much for making the time to come this morning. Thank you.