SEEK Limited (ASX: SEK) released its 2018 financial results to the market today revealing an 11.5% increase in revenue.
SEEK is one of the largest job portal businesses in the world, it owns seek.com.au. It is the leader in Australia but it also has many other leading websites in Asia and South America, in countries like Brazil and China.
Here are some of the highlights from its report:
- Reported revenue up 24% to $1.295 billion
- Reported profit for owners down 84% to $53.2 million
- EBITDA was up 16% to $432.8 million (click here to learn what EBITDA means)
- Underlying net profit (excluding significant items) up 3.9% to $230 million
- Total dividends per share up 5% to 46 cents
According to Bloomberg, analysts were expecting SEEK to report a profit of $206 million. A dividend of $0.45 was also expected. The reported profit appears to be under expectations.
SEEK CEO and co-founder Andrew Bassat said: “SEEK is performing strongly across five out of six of our major headings. Our three biggest businesses, SEEK ANZ, SEEK Asia and Zhaopin are all travelling well.”
Zhaopin is seen as a key part of SEEK’s future. It’s a leading job portal business in China. SEEK management believe China will become the largest human capital market in the world. Between FY12 and FY18 Zhaopin grew revenue at a compound annual growth rate of 19%, which is a lot.
“Zhaopin has successfully evolved its business model which contributed to strong growth in operating metrics and revenue,” Mr Bassat commented. “The focus is to continue investing aggressively and capitalise on the enormous market opportunity in China.”
Between SEEK in Asia Pacific & Americas, and SEEK Investments, the company estimates it has candidate relationships with nearly 200 million people and hirer relationships with almost 1 million organisations.
In FY19 SEEK said it will invest further into its businesses that it thinks it can generate a good return over the long run.
Next year SEEK is guiding for revenue growth of 16% to 20%, EBITDA growth of 5% to 8%, and it will invest around $35 million to $40 million in early-stage ventures.
With all of that in mind, FY19 reported net profit is forecast to be broadly similar to FY18.
Mr Bassat finished by saying: “Our FY19 outlook for aggressive investment reflects our high conviction view that SEEK is well placed to capture large growth opportunities.”
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