Hire growth
INVESTOR DAY
Need To Know
- Growth being driven by yield improvements
- ANZ not ex growth, Asia to benefit from Unification platform
- FY23 revenue guidance tweaked for moderation of job ad volumes
SEEK is targeting a $2bn revenue opportunity by FY28 from increasing yield across its portfolio, and from market share opportunity across Asia.
The revenue opportunity is summarised by SEK as:
- ANZ ad volume neutral to low single digit growth
- ANZ yield high single digit growth
- Asia revenue double digit growth
SEK ANZ’s average yield per ad is about $251 on monthly paid ad volumes of around 284k. There is still significant runway for product innovation to continue lifting yield and expanding reach into more aspects of the job search/placement industry. With 31% market share in ANZ, SEK continues to dominate the space and can transplant its expertise into Asia.
At the interim result, we saw a strong result from SEEK Asia. This signals the traction and progress SEK is making in this large market. Once the Unification program is complete (end of FY24), SEEK Asia will be able to build on its average yield of $70 and monthly paid ad volumes of 241k and market share of 23%.
SEK noted a moderation of job ad volumes in 3Q and has modestly (~1%) lowered its revenue guidance for FY23 to $1.245bn. Operating expenditure has been lowered so that earnings are unaffected. EBITDA guidance (c$560m) and NPAT (c$250m) are unchanged but are at the lower end of earlier guidance ranges. This was signalled at the 1H23 result.
SEK’s dividend policy is to target a payout ratio greater than 75% of cash net profit less capex.
Investment View
Customers are prepared to pay more for additional value (depth and premium products) creating a yield driven growth path for SEK’s earnings. The unification platform will bring much of the ANZ innovation to SEK Asia enabling a strong growth pathway across Asia.
SEK’s Growth Fund is an incubator of new technology and ideas and carries a separate but meaningful valuation to the group.
Stock Overview
Share Price
Company Overview
SEEK is Australia’s leading online employment marketplace. It has similar platform investments in Asia, China, Brazil and Mexico.
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Issuer
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