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Australia –SEEK sees boost from international revenue and makes bid for JobStreet

19 February 2014

Australian job board SEEK (SEK: ASX) announced revenue of AUD 343.3 million (USD 310.3 million) for the six months ending 31 December 2013, a year-on-year increase of +87.8% from AUD 231.2 million (USD 208.9 million) last year.

The company achieved a net profit after tax for the six month period of AUD 147.4 million (USD 133.2 million), an increase of +114.2% compared with AUD 68.8 million (USD 62.2 million) a year ago.  

The Australian economy experienced a relatively subdued macroeconomic environment with the six month average unemployment rate reaching 5.8%, the highest level since SEEK’s listing in 2004. Despite this, the company’s domestic employment division reported revenue of AUD 116.9 million (USD 105.6 million), a fall of -3% from AUD 120.9 million (USD 109.3 million) last year.

International revenue grew by +127% during the first half of the year, rising to AUD 185.8 million (USD 167.9 million) from AUD 82 million (USD 74.1 million) in 2012. The greatest growth was reported in the company’s Mexican business OCC Mundial which rose by +84% to AUD 11.6 million (USD 10.5 million) from AUD 6.3 million (USD 5.7 million).

South-east Asian job board JobsDB, reported revenue growth of +20% to AUD 29.4 million (USD 26.6 million), up from AUD 24.4 million (USD 22.1 million) last year. Revenue derived from Brasil Online rose by +8% to AUD 55.3 million (USD 50 million), compared with AUD 51.3 million (USD 46.4 million) a year ago.

SEEK’s Chinese job board Zhaopin, was acquired in February 2013, therefore year-on-year comparison is not yet possible. During the six month period, however, revenue from the company was AUD 89.5 million (USD 80.9 million).

During the half-year, SEEK sold its remaining 80% interest in its learning division subsidiary THINK on 30 November 2013, with cash proceeds of AUD 99.5 million (USD 89.9 million) being received.

The company also announced that SEEK Asia, a majority owned subsidiary, has executed a share purchase agreement with co-investors to acquire 100% of online employment business JobStreet. The completion of the transaction is still subject to regulatory approval in Singapore and also approval by JobStreet shareholders. Pending approval SEEK will hold a controlling share of 75.2%. 

Listed on the Malaysian stock exchange and founded in 1995, JobStreet claims to be the leading job site in Malaysia (responsible for 60% of revenue). JobStreet also operates in India, Indonesia, Japan, Hong Kong, Philippines, Singapore, Thailand and more recently opened in Vietnam. The firm provides online recruitment and human resource management services. For 2012, the company had annual revenue of MYR 160.8 million (USD 52.4 million) and net profit of MYR 58.3 million (19.0 million).

Looking forward, SEEK reports good sentiment and operating conditions across most markets, but particularly in Asia. Based on current conditions, the company expects revenue for the second half of the year to be slightly ahead of the first six months.

In trading today, the company’s share price jumped by +17.8% to AUD 15.70 (USD 14.19), an increase of +82.7% compared with a year ago. Based on its current share price, the company has a market value of AUD 5.3 billion (USD 4.8 billion).      

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