Seek Growth Shudders To Halt
Sydney Morning Herald
Friday November 7, 2008
THE spectacular growth of online jobs website Seek has come to a screeching halt, with the company warning its earnings growth will fall from 37 per cent to zero this year in the economic downturn.
Addressing Seek's annual meeting in Melbourne yesterday, joint chief executives Paul and Andrew Bassat warned operating earnings would only match last year's $109.8 million, following six years of growth and a 37 per cent jump in profit in 2007-08. Net income would fall for the first time since the 2001 tech crash as Seek would book higher losses from its increased investment in the Chinese job site Zhaopin.Seek's shares slumped 41c, or 10.5 per cent, to $3.49. The warning came just three months after Seek said it was confident of growing profitability this year."The environment is a lot tougher, there's no question," Paul Bassat told the Herald yesterday. "We had a pretty solid first quarter but certainly the last six weeks have been a lot tougher and the outlook that we gave just reflects a much tougher macro environment."But he said the growth driver of the business, the migration of job ads from print to online, would continue and possibly accelerate as employers looked for cheaper options.Seek, 27 per cent owned by James Packer's Consolidated Media, is the biggest online job advertiser in Australia and New Zealand, has stakes in education companies in Australia and an online presence in Brazil.In Asia, it owns 43 per cent of Zhaopin, and has a stake in Malaysia's JobStreet Corp.
© 2008 Sydney Morning Herald