SEEK & You Shall Find Annual Report 2009
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outside back cover 7mm outside front cover SEEK Limited Annual Report 2009 SEEK Limited seek.com.au seek.co.nz SEEK & you seek.co.uk seekvolunteer.com.au shall find seeklearning.com.au seekcommercial.com.au Annual Report 2009 SEEK Limited ABN 46 080 075 314 inside front cover 7mm inside back cover Contents Notice of Annual General Meeting Corporate Directory 2 Chairman’s Letter The Annual General Meeting 4 Joint CEOs’ Review will be held at 12 Financial Report for 2009 Crown Melbourne Limited 13 Directors’ Report 8 Whiteman Street 38 Auditor’s Independence Declaration Southbank, Victoria 3006 39 Corporate Governance Statement Time: 3:00pm 47 Annual Financial Report Date: 30 November 2009 48 Income Statements A formal notice of meeting is enclosed. 49 Balance Sheets 50 Statements of Changes in Equity 51 Cash Flow Statements 52 Notes to the Financial Statements Directors Principal registered office in Australia 108 Directors’ Declaration Robert C G Watson Level 6 109 Independent Auditor’s Report Chairman 541 St Kilda Road to the Members of SEEK Limited Melbourne Victoria 3004 111 Shareholder Information Paul M Bassat (03) 8517 4100 IBC Corporate Directory Joint Chief Executive Officer Andrew R Bassat Share registrar Joint Chief Executive Officer Computershare Investor Services Pty Limited 452 Johnston Street Colin B Carter Abbotsford Victoria 3067 Neil G Chatfield (03) 9415 4000 Secretary Auditor Ian J McAuliffe PricewaterhouseCoopers Freshwater Place Notice of Annual General Meeting 2 Southbank Boulevard The Annual General Meeting of SEEK Limited Southbank Victoria 3006 will be held at: Solicitors Crown Melbourne Limited Arnold Bloch Leibler 8 Whiteman Street Level 21 Southbank Victoria 3006 333 Collins Street Time: 3:00pm Melbourne Victoria 3000 Date: 30 November 2009 Bankers Westpac Banking Corporation National Australia Bank Stock exchange listings SEEK Limited shares are listed on the Australian Securities Exchange. (Listing code: SEK) Website address www.seek.com.au precinct.com.au Despite a challenging environment, SEEK’s focused growth agenda and diligent execution resulted in a strong performance in the 2009 financial year. This is testament to the strong business fundamentals of SEEK’s online classified and education businesses. SEEK Limited Annual Report 2009 1 The 2009 financial year has seen SEEK deliver a strong financial performance, during a period of worldwide economic downturn and a weaker recruitment advertising market. The long-term strategy of diversifying into the education sector saw an increased financial contribution this year. Chairman’s A highlight of the year was a major expansion IDP continues to perform very well, delivering in both the international online employment results ahead of expectations and paying Letter market and the Australian education sector, SEEK its first dividend of $5.0m since which has significantly strengthened the our initial investment. combined operating assets of the Group. We continue to see great opportunities for SEEK’s focused and consistent strategic growth in the international online employment agenda has enabled the company to retain market and during the year we made three its strong market leadership in the online investments in overseas markets. Firstly, employment sector. The continued structural we increased our stake in Zhaopin, a leading migration of employment advertising from print Chinese online employment business, to 56.1%. to online has been central to SEEK’s historical Our investment in the Zhaopin business and growth and has contributed to the current brand has delivered strong growth in market resilience in the online job market. share and jobseeker metrics, and we are seeing an improved financial position from Over the past decade we have developed this early stage market business. organisational capabilities in our online classifieds business that continue to be We also acquired a 30.0% stake in Brasil Online expanded in other markets, namely education Holdings, the owner of the two leading online and the international online classifieds market. employment websites in the Brazilian market. In conjunction with the major shareholder, We have made significant progress this year we are actively involved in the future strategic in developing and growing our Education direction of the business. business, and we now have a robust set of assets including SEEK Learning, the Think Our third investment was the purchase of a Group and a 50% stake in IDP Education. 10.1% stake in JobStreet Corporation Berhad (listed in Malaysia), which is a leading online SEEK Learning’s strategy is to become employment website in South East Asia. the first and best place to go for career- related education and training by leveraging Our combined international investments our competencies in sales, marketing and now give us a significant footprint in several distribution and through cross-promotion of the world’s largest emerging markets, to the large audience of jobseekers that we which provides a substantial growth platform attract through our Employment business. for the future. During the 2009 financial year SEEK invested a further $42.6m to take our 50% stake in the Think Group to 100% ownership and control. The Think Group is a leading Australian education group which owns several private tertiary colleges providing over 80 qualifications. 2 SEEK Limited Annual Report 2009 Financial overview Our employment classifieds business will Group sales revenue declined marginally by continue to be supported by the ongoing 0.9% to $208.3m. In a slowing job market, structural migration from print to online. employment revenue decreased by 10.6% to We continue to see opportunities to increase $168.9m. However, revenue from the Education our market share through ongoing investment business increased by 84.8% from $21.4m to in our brand, the introduction of product $39.5m. Reductions in discretionary costs were extensions and a growing presence in also implemented during the year. Earnings traditional print employment categories such before interest, tax, depreciation, amortisation as Government, Healthcare and Education. and share-based payments (EBITDA) declined In the coming year with the addition of a full by 11.0% to $97.8m and EBITDA margins year of the Think Group and expected growth declined from 51.9% to 46.6%. in the SEEK Learning business, we expect the SEEK continued to generate strong cash Education business to continue the trend of flows, with EBITDA to operating cash flows increased profitability. before interest and income conversion of The combined Employment and Education 106% (2008: 96%). A capital raising of $121.7m, businesses are leveraged to favourable industry strong cash generation, and an increased trends, which bodes well for future growth. bank loan facility enabled us to make the local and international investments previously Our conservative capital structure and strong mentioned. SEEK continues to maintain operating cash flow position us well in the a conservative debt position. The Board has current market environment. declared a final dividend of 4.7 cents per I would like to take this opportunity to share fully franked, giving a dividend for the congratulate the SEEK team on delivering a full year of 9.2 cents per share fully franked. strong result in difficult times, and continuing to deliver a first class service for customers Outlook and jobseekers as well as creating an exciting While the global financial crisis still affects the and dynamic environment in which to work. Australian, New Zealand and world economies, On behalf of the Board I would like to extend there are signs of stabilisation. However, it is our thanks for the team’s ongoing energy, difficult to forecast at what stage significant commitment and passion for the business. economic growth will return. Our employment classifieds business will continue to be the largest component of the Group’s profit, but we expect an increasing contribution from our Education business and a further expansion of the financial contribution from Bob Watson our international investments. Chairman SEEK Limited Annual Report 2009 3 Joint CEOs’ Consistent strategy and focused execution Product extensions including Standout Ads enabled SEEK to deliver strong results in and Premium Ads, performed well during the Review a challenging environment during the 2009 year and are poised for further growth. SEEK financial year. also launched the ‘Great Australian Pay Check’ survey, which improved the jobseeker and This is reflected in SEEK’s position as the advertiser experience alike. leading online employment classifieds business in Australia and New Zealand and a leading In Australia, our ongoing investment in provider of education services in Australia. the SEEK brand reaped results. Unaided awareness of the SEEK brand continues to SEEK Employment grow and is now almost three times that of Tougher employment market conditions in our nearest competitor, and all jobseeker Australia and New Zealand resulted in lower metrics showed strong improvement. Of the ad volumes and revenues in 2009 compared total amount of time spent on the three to last financial year. leading Australian employment websites, nearly 80% was spent on seek.com.au, However, the market fundamentals a key indicator of user satisfaction. underpinning our business remain robust, and the core employment business continues to In New Zealand the business performed benefit from the ongoing structural migration well in very challenging employment of advertising from print to online, with market conditions. While ad volumes and approximately 79% of job ads now online. revenues were down, SEEK continued to Jobseekers are also migrating to online, with enjoy a strong market leadership position an historic record of approximately 73% of in the New Zealand market. jobseekers now preferring to search for a job Looking ahead, our focus remains on online (up from 62% last year). maintaining our leadership position in the Our market share remains strong. In June online employment classifieds market and 2009, SEEK had nearly three times more jobs continuing to drive the migration of the on its Australian website and twice as many market from print to online.