Seek lifts profit, plots aggressive acquisition strategy

Online jobs boss Andrew Bassat says there needs to be more give and less take in Australia’s relationship with China.

Australia needs to be more respectful towards China, says Seek CEO Andrew Bassat. Pic: Stuart McEvoy

Seek chief executive Andrew Bassat says Australia needs to show China more respect in business dealings between the two countries, claiming the Chinese can sometimes see it as simply a one-sided relationship.

Speaking in the wake of the federal government’s rejection of bids from Chinese and Hong Kong firms for NSW electricity distribution business Ausgrid, Mr Bassat said it was important for companies like Seek, which has a significant footprint in China, for Australia to provide more give and less take in the relationship.

“I do think to some extent Australia needs to be more respectful towards China. Australia wants to benefit from the good things China brings but sometimes doesn’t want to do anything in return. So it can be all take and no give ... They can see it as a one-sided relationship,’’ he told The Australian.

“It is not very smart if we think China is part of the future for our business.’’

The comments came as the online jobs market operator lifted its profit by more than a quarter for the full year, despite mixed market conditions.

For the year to June 30, Seek (SEK) booked a record profit of $357.1 million, up 27 per cent on the prior year.

The group’s underlying profit gain was more subdued, however, rising a modest 3 per cent to $198.1m on a revenue advance of 11 per cent to $950.4m.

The underlying result still managed to edge the group’s guidance.

Mr Bassat labelled the result “strong” given “flat macro conditions”, adding growth was expected through acquisitions in the coming year.

“We are reinvesting aggressively within our current businesses and also making strategic acquisitions to position Seek to play a role in the large human capital management industry,” he said.

The company is tipping reported net profit after tax of $215m-$220m for FY2017 as the group continues its offshore expansion.

“Seek’s global platform and focused reinvestment is leading to new products and services which makes Seek uniquely positioned to capture large market opportunities across the large human capital management industry,” Mr Bassat said.

“We are pleased with Seek’s progress but there remains significant untapped opportunities. Our focus is to aggressively invest and execute our growth strategy to capitalise on these large growth opportunities.”

Mr Bassat also revealed that Seek would make more investments in early stage businesses. The company has earmarked around $25 million for the year ahead but Mr Bassat said this could be a larger sum in the future.

“We would like to do more. To date many of those investments are loss-makers,’’ Mr Bassat said. This year losses across the early stage investment portfolio grew to $19.2m from $6.2m a year earlier.

The investments include firms such as Sidekicker and Jora, which are start ups in the online employment space.

“What I hope is we are much more active and aggressive in this space ... It is lumpy and we will do more and as a result the investments may be greater.’’

Seek declared a final dividend of 19c a share, up 12 per cent on the corresponding dividend in 2015.