FY18 Full Year Results
FY18 Key Highlights
Excl significant items: Revenue, EBITDA and underlying NPAT at top end of guidance
- Top end of guidance range: Revenue growth of 25%, EBITDA growth of 15%, Underlying NPAT(see Note 1 below) of c$230m
- Record FY18 dividends of 46 cents (5% growth vs pcp)
- Strong results reflect benefits of sustained investment and strategic execution
Asia Pacific & Americas (AP&A): Strong ANZ results & good momentum in Asia
- SEEK ANZ: Record financial results reflect benefits of sustained reinvestment
- SEEK Asia: Strong revenue momentum due to new initiatives and improving macro conditions
- LATAM: Challenging conditions and disappointing financial results led to impairment
SEEK Investments: Strong growth across the portfolio
- Zhaopin: Strong financial results and well positioned for long-term capital appreciation
- OES: Good underlying financial results and investing to grow new revenue streams
- ESVs: Strong growth in operating metrics and revenue reflects high growth potential
SEEK Limited ("SEEK") announced its results for 12 months ended 30 June 2018
- Reported Revenue of A$1,294.5m (FY17: A$1,039.7m)
- Reported EBITDA of A$432.8m (FY17: A$375.8m)
- Underlying NPAT (excl. significant items & Early Stage Ventures) of A$229.5m (FY17: A$220.8m)
- Reported NPAT of A$53.2m (FY18: A$147m of significant items, FY17: A$340.2m, which includes OES fair value gain of $138.7m and other one-off items)
Commenting on SEEK's last 12 months, 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. In particular, each business achieved strong H2 revenue growth which augurs well for FY19."
"We are disappointed with the performance of our LatAm businesses. We remain committed to these markets and hopeful greater strategic focus, resourcing under the AP&A structure and an improving economy can over time assist in turning around performance."
"OES is making good inroads into their strategic imperatives and is progressing well with the Western Sydney University partnership which commenced in early FY18."
"And finally our Early Stage Ventures are showing promising growth giving us confidence to invest more into some of these businesses and to make further similar investments."
"Overall, SEEK is performing at a high level which is validation that our strategic approach is the right one to grow shareholder value."
IMPAIRMENT OF LATAM BUSINESSES AND FAIR VALUE GAIN IN MAIMAI
SEEK will recognise the net impact of three key significant items totalling A$142m:
- Non-cash impairment charge against the carrying value of Brasil Online (impairment charge: A$119m) and OCC (SEEK share of impairment charge: A$59m)
- Non-cash fair value gain of A$36m on investment in Maimai (SEEK share)
ASIA, PACIFIC & AMERICAS (AP&A)
SEEK ANZ: Record EBITDA result despite continued investment
- Strong financial result with revenue growth of 16% and EBITDA growth of 18%
- Market leader with c36% of placements, lead of c7x times over our nearest competitor
SEEK Asia: Continued momentum in operational metrics and revenue growth
- Solid H2 Revenue result particularly across more mature markets
- Investment is delivering strong growth in operating metrics
Andrew Bassat commented,
"SEEK ANZ delivered strong results alongside continued investment. Reflecting the strength of the business, ANZ's revenue has increased by approximately 70% in the last four years. We remain very excited by ANZ's product roadmap and the short and long-term outlook."
"SEEK Asia is in an earlier stage of business model evolution. Early initiatives in sales, product and tech are delivering good results and alongside better macro conditions, this is leading to improving revenue results. We expect closer integration with ANZ to accelerate SEEK Asia's business model transition. SEEK Asia is well positioned to capitalise on the large market opportunities in a high growth region."
Zhaopin: Strong revenue result alongside growth in market share
- Strong Revenue growth of 21% and strong growth in key operating metrics
OES: Good underlying financial results alongside strong student outcomes
- Investing to build a leading multi partner platform
ESVs: Continued investment to support rapid scale up of early stage businesses
- Strong revenue growth of 30% across the portfolio(see Note 2 below)
Andrew Bassat commented,
"Zhaopin has successfully evolved its business model which contributed to strong growth in operating metrics and revenue. The focus is to continue investing aggressively and capitalise on the enormous market opportunity in China. Led by CEO, Evan Guo and supported by SEEK we believe that Zhaopin is well placed for long-term growth."
"OES continues to successfully deliver excellent student outcomes to over 11,000 Australians, who are predominantly working adults. A key priority is to form new domestic and international partnerships to create new revenue streams."
"We are pleased with the progress of our early stage investments which as a portfolio grew revenue by 30%. A dedicated SEEK Investments team is focusing on new investment opportunities across the large headings of Human Capital Management and Online Education."
DIVIDENDS | 5% growth in FY18 dividends
- H2 18 dividend per share of 22 cents per share (growth of 5% vs pcp)
- Record total FY18 dividends of 46 cents (growth of 5% vs pcp)
- The final dividend will be paid on 4 October 2018 with a record date of 13 September 2018.
OUTLOOK | FY19 short term guidance
FY19 Guidance (excl. significant items)
- Revenue growth in the range of 16% to 20% (FY19 vs FY18) (see Note 3 below)
- EBITDA growth in the range of 5% to 8% (FY19 vs FY18) (see Note 3 below)
- Investments in Early Stage Ventures of approximately A$35m to $40m
- Reported NPAT (incl cost of investments in ESVs) to remain broadly similar to FY18 Reported NPAT
In conclusion Andrew Bassat commented,
"Our FY19 outlook for aggressive investment reflects our high conviction view that SEEK is well placed to capture large growth opportunities. We are looking to allocate approximately 80% of the increase in Group Opex and c70% of Group Capex into our largest and highest performing businesses being SEEK ANZ, Zhaopin and SEEK Asia. We are confident these businesses will deliver strong FY19 results and that the aggressive investment will underpin strong returns for long-term shareholders."
ANNUAL GENERAL MEETING
In accordance with ASX Listing Rule 3.13.1, SEEK Limited advises that its Annual General Meeting will be held in Melbourne, Victoria on 27 November 2018.
1 Underlying NPAT defined as excluding significant items and before deducting investments in early stage growth options
2 Based on assumption of 100% ownership across FY18 and FY17 (SEEK Investment ESVs)
3 Includes consolidated early stage investments
To view FY18 Result Presentation, please visit:
To view Appendix 4E and Statutory Accounts, please visit:
About SEEK Limited
SEEK Limited (ASX:SEK) (OTCMKTS:SKLTY) is a diverse group of companies, comprised of a strong portfolio of online employment, educational, commercial and volunteer businesses. SEEK operates across 18 countries with exposure to over 2.9 billion people and approximately 26 per cent of GDP. SEEK makes a positive contribution to people's lives on a global scale. SEEK is listed on the Australian Securities Exchange, where it is a top 100 company with a market capitalisation close to A$6billion and has been listed in the Top 20 Most Innovative Companies Globally by Forbes, and Number One in Australia.
Link: Full Year Statutory Accounts and Appendix 4E
Link: SEEK FY18 Full Year Results