Seek share price slides despite NPAT soaring 81%

How did Seek perform in the 2022 financial year?

| More on:
An older woman with grey hair and wearing glasses looks at her laptop screen with her hand outstretched to demonstrate that she doesn't understand what she is reading

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Seek shares edge 0.45% lower to $24.24 during early morning trade
  • The company released its FY22 results, highlighting double-digit growth across key financial metrics
  • The board declared a fully franked final dividend of 21 cents per share

The Seek Limited (ASX: SEK) share price is heading south today after the company dropped its full-year results.

At the time of writing, the job listings giant's shares are down 0.45% to $24.24.

The share price fell as low as $23.67 shortly after the market open but has recovered somewhat now.

Seek share price falters despite double-digit growth

This morning, Seek delivered its FY 2022 results for the 12 months ending 30 June 2022.

Here are some of the key takeaways:

What happened in FY 2022?

Seek achieved record ad volumes of 325,000 in March 2022 across Australia and New Zealand. This was underpinned by a tight employment market which drove high levels of activity.

The average ad yield grew 11% over the pcp, attributed evenly through higher prices, customer mix, and increased depth adoption.

In Asia, volumes grew across all markets despite some ongoing lockdowns from COVID-19. The average ad yield fell 1% compared to FY 2021 on the back of advertisers purchasing larger packages resulting in higher volume-based discounts.

However, this was largely offset by an increase in depth adoption with growth in branded ads and strong take-up of the new premium ad. Bundling of ad products also made it easier for advertisers to purchase depth products.

Management commentary

Seek CEO and managing director, Ian Narev, had this to say about the results:

In all our Asia Pacific markets, ongoing economic recovery drove high demand for labour, which in turn led to strong job ad volumes and increased depth adoption. Our markets continue to be highly competitive. However, SEEK maintained its market leadership positions, with stable placement metrics throughout Asia Pacific. Increased investment in Asia led to improved candidate metrics.

What's the outlook for FY 2023?

Seek provided its FY 2023 guidance excluding significant items and the Seek Growth Fund.

This includes the following:

  • Revenue in the range of $1.25 billion to $1.30 billion
  • EBITDA in the range of $560 million to $590 million
  • NPAT in the range of $250 million to $270 million.

Narev touched on the new financial year, concluding:

Economic and labour market conditions across our key markets remain positive, although some leading indicators look slightly weaker. Our revenue guidance for FY23 assumes a continuation of largely positive conditions.

We have assumed a low risk of job market volatility from monetary policy, geopolitical change and the pandemic. If this assumption changes, revenue could fall below guidance. Our guidance also assumes a continuation of the accelerated investment from FY22, in particular the Platform Unification program. Spend for the project will peak in FY23 as we ensure that our systems are sufficiently flexible, resilient and scalable to drive future growth.

Seek share price snapshot

The Seek share price has lost 28.7% since the beginning of 2022 but is up 3.7% in the past week.

For context, the benchmark S&P/ASX 200 Index (ASX: XJO) has shed around 6% for the calendar year.

Seek presides a market capitalisation of approximately $8.64 billion.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended SEEK Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Earnings Results

a farmer kneels on one leg and closely examines soil from his farm against a blue sky backdrop.
Earnings Results

ASX 200 consumer stock surges despite loss and dividend cut

Investors were quick to overlook the negatives.

Read more »

Miner standing at quarry looking upset
Resources Shares

This ASX All Ords mining stock sinks 13% after a rocky quarter

Investors continue unloading shares in the precious metals company.

Read more »

A businessman carrying a briefcase looks at a square peg or block sinking into a round hole.
Earnings Results

Block shares are diving 7% despite significant profit growth in third quarter

Financial services company Block has released its 3Q FY24 report.

Read more »

Happy couple at Bank ATM machine.
Earnings Results

ANZ shares on watch after cash profit dives 9% to $6.7b

How did the big four bank perform during the 12 months compared to expectations?

Read more »

A man holds his head in his hands, despairing at the bad result he's reading on his computer.
Earnings Results

NAB shares tumble 3% after FY24 result disappoints investors

The market isn't liking the big four bank's result today.

Read more »

A man looking at his laptop and thinking.
Earnings Results

NAB share price on watch after FY24 profits sink to $7.1b

How did the big four bank perform during the year?

Read more »

A male investor wearing a blue shirt looks off to the side with a miffed look on his face as the share price declines.
Earnings Results

Goodman shares fall on Q1 update

How did the company perform in the first quarter? Let's find out.

Read more »

A man in a suit smiles at the yellow piggy bank he holds in his hand.
Earnings Results

Westpac shares on watch amid $6.99b profit and new buyback

Has the big four bank delivered the goods for investors this year? Let's find out.

Read more »