SEEK ups profit, dividends amid subdued conditions
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Australia's biggest jobs website reports underlying profit and dividends ahead of Morningstar's expectations, despite a subdued economic environment.
SEEK Limited's (ASX: SEK) underlying net profit before one-off items for fiscal 2016 rose 3 per cent to $198.1 million, ahead of guidance and Morningstar's estimate of $174.5 million, after previous reinvestments in the business managed to offset subdued economic conditions.
The Australia and New Zealand Employment division saw revenue growth of 15 per cent, while the International division posted revenue growth of 18 per cent, the jobs website said in a statement to the ASX.
SEEK declared a final dividend of 19 cents a share, up 12 per cent year over year, bringing total fiscal 2016 dividends to 40 cents a share, up 11 per cent and ahead of Morningstar's forecast for a payment of 33 cents.
The final dividend will be paid on 14 October 2016 to shareholders on record as of 15 September 2016, the company said.
"SEEK has achieved a record full-year result, a strong achievement given we have been operating in relatively flat macro conditions," SEEK CEO Andrew Bassat said.
"SEEK's evolution is most advanced in Australia and New Zealand which achieved EBITDA (earnings before interest, tax, depreciation and amortisation) growth of 15 per cent. This strong result is also testament to the medium to long-term benefits of reinvestment.
“SEEK's International businesses are strong market leaders and achieved EBITDA growth of 17 per cent against a backdrop of subdued conditions.
"The near-term priority is to continue with a focused reinvestment program to grow market leadership, build data moats and launch new products and services."
Bassat expects the company to post a reported net profit--before significant items and before deducting early-stage growth ventures--in the range of $215 million to $220 million in fiscal 2017, down from a reported net profit of $357.1 million in fiscal 2017.
"SEEK's global platform and focused reinvestment is leading to new products and services which makes SEEK uniquely positioned to capture large market opportunities across the large human capital management industry," he said.
"We are pleased with SEEK's progress but there remain significant untapped opportunities. Our focus is to aggressively invest and execute our growth strategy to capitalise on these large growth opportunities."
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Nicholas Grove is a Morningstar journalist.
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