Seek smashes earnings on record job ad volumes, upgrades FY22 guidance

Labour shortages and high staff turnover drove record volumes to the Seek (ASX: SEK) platform in the first-half of FY22.

Financials at a glance: 

• Revenue of $517m, up 59% 

• Margins of 48%, up from 42% 

• Net profit of $124m, up 147% 

• Interim dividend of 23 cents per share, up 15%

The profit figure came well-above Bloomberg estimates of $101m. 

Seek shares rallied 5% as the market opened.

“Market conditions across our ANZ and Asia businesses were favourable for revenue growth. Businesses continued to rehire following COVID-related cuts, and in many cases restarted investment,” CEO and Managing Director Ian Narev said in a statement. 

Seek experienced a steady increase in job ad volumes, reaching record levels in November 2021. Conversely, applications per job ad hit all-time lows in November, consistent with trends such as low unemployment and candidate scarcity. 

FY22 guidance 

Seek provided the following guidance for the FY22 (excluding significant items and the Seek growth fund):

• Revenue in the range of $1.05bn to $1.1bn, up 32–45% 

• Net profit in the range of $230m to $250m, up 63-77%

“Our key markets are experiencing, to varying degrees, a combination of ongoing economic recovery, relatively low unemployment rates and continued restrictions on labour mobility. Job ad volumes and depth adoption remain high,” said Narev.

Investors should note that Seek intends to accelerate its investment in the second-half, even "if this limits further margin expansion this year."