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UPDATE 1-Australian jobs portal Seek posts 4.2 pct profit fall
August 22, 2016 / 3:26 AM / a year ago

UPDATE 1-Australian jobs portal Seek posts 4.2 pct profit fall

(Adds comment from CEO and analyst, details on earnings)

SYDNEY, Aug 22 (Reuters) - Australian job classifieds portal Seek Ltd said on Monday its underlying annual profit fell 4.2 percent, hit by a downturn in Brazil's economy and a plunge in earnings from its education business.

The company's underlying profit excluding one-off costs was A$178.9 million ($136 million) in 2015-16, compared with A$186.8 million the previous year and below an average of analysts' forecasts of A$181.5 million.

Shares in Seek fell 2.5 percent on the result, in a flat Australian market, though they had recovered by 0223 GMT. The company announced a final dividend of 19 cents, compared with 17 cents in 2015.

"There's nothing terribly much to be disappointed about, but nothing to move the needle the other way either," Commonwealth Securities analyst Tom Piotrowski said.

Chief Executive Andrew Bassat said earnings had "bottomed out" in the education arm, where revenue from online courses fell 48 percent due to competition and tighter rules for accessing government subsidies.

International revenue, which is mainly drawn from operations in China, Brazil and Mexico, rose 18.1 percent to A$592.3 million and has grown as a proportion of Seek's income.

But Seek's Brazilian business reported a 23 percent fall in revenue due to slowing economic growth there, said Isar Mazer, managing director of Seek's international operations.

"When the economy recovers, we're very confident that the business will recover with it," he said.

If investments in early-stage businesses were stripped out, net underlying profit was A$198.1 million, exceeding guidance of A$195 million. The company reaffirmed its profit guidance for 2017, excluding early-stage investments, of A$215-220 million.

Seek's overall net profit, which was boosted by the sale of its stake in international student placement service IDP Education, was A$357.1 million. ($1 = 1.3151 Australian dollars) (Reporting by Tom Westbrook; Editing by Stephen Coates)

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