Asia, Brazil weakness crimps SEEK earnings

Online jobs portal SEEK’s first-half net profit dropped 69 per cent to $84.

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1 million as weak economic conditions in Brazil and south east Asia weighed on earnings.

However chief executive and co-founder Andrew Bassat has pointed to growth in the Australia and New Zealand markets, and a lift in underlying profit, as validation of the company’s strategy.

SEEK’s financial performance was affected by the end of its Vocational Education and Training (VET) business in Australia, and gains from asset sales recognised in the same period a year earlier.

Revenue in SEEK’s Australian and New Zealand operations rose 13 per cent, while group-wide revenue gained one per cent.

Weak economic conditions in Brazil and south east Asia hit revenue in the company’s international division, which accounts for almost two thirds of the company’s total revenue.

SEEK Asia revenue dipped three per cent, dragged down by weak economic conditions in Hong Kong, Malaysia and Singapore, but China was a bright spot, with jobs site Zhaopin improving revenue by 11 per cent.

Sales were down eight per cent in Brasil Online, due to depressed economic conditions in Brazil, which remains in recession.

“SEEK International is operating against soft macro conditions and is at an earlier stage of its business model evolution,” Mr Bassat said.

SEEK is proceeding with moves to privatise Zhaopin, and says it will retain a stake in Zhaophin if that goes ahead.

The company’s shares dropped 22 cents, or 1.4 per cent, to $15.52.

SEEK’S OVERSEAS BUSINESSES DENT PROFIT

* Half year net profit down 69pct to $84.1m

* Revenue up 1pct to $487.9mn

* Interim dividend up 2 cents to 23 cents, fully franked