Australia's Seek swings to loss on lower job ad volumes; shares slump

SEEK

13/08/2024 04:36

* 
      Shares set for worst day since Feb. 13
    

        * 
      Seek's earnings, guidance below analysts estimate
    

        * 
      Declared final dividend of 16 AU cents
    

  
    By Ayushman Ojha
       Aug 13 (Reuters) - Shares in Australia's Seek  SEK.AX 
were set for their worst drop in six months on Tuesday, after
the online jobs portal swung to an annual loss hit by lower job
advertisement volumes in Asia, and gave a disappointing earnings
forecast.
    Seek reported net loss after tax of A$100.9 million ($66.48
million) for the year ended June 30, compared with a profit of
A$1.05 billion a year ago.
    Shares fell as much as 11.4% to A$19.61, set for their worst
intraday loss since Feb. 13.
    "The decline in job ads in ANZ (Australia and New Zealand)
is well known, but we are surprised to see the underperformance
in Seek Asia, which is supposed to be the future growth driver
of the business," analysts at Jefferies said.
    Earnings from the Asia segment more than halved to A$46
million for the year, as lower-priced basic ads declined more
than higher-yielding premium ads.
    For fiscal year 2025, Seek expects adjusted net profit after
tax between A$130 million and A$180 million, mid-point of which
is 29% below Jefferies estimate and 24% lower than UBS' view.
    "For Asia, we have seen early signs that the slowdown is
moderating and we expect a partial recovery in the second half,"
Seek CEO Ian Narev said.
    Seeks expects high single-digit yield growth from ads to 
more than offset low single-digit decline in paid job ad volumes
in fiscal 2025.
    "Looking into FY25, revenue guidance appears to be
predicated on a more aggressive ANZ volume declines than
expected but the positive is yield guidance appears better than
expectations," analysts at UBS said.
    The company also declared a final dividend of 16 Australian
cents per share, down from 23 cents apiece in the last year.
      
    
    

($1 = 1.5177 Australian dollars)

 (Reporting by Ayushman Ojha; Editing by Rashmi Aich)
 ((Ayushman.Ojha@thomsonreuters.com;))