Seek Drops Dividend In Favour Of “Flexibility”

By Glenn Dyer | More Articles by Glenn Dyer

Online jobs group, Seek has made the early decision to drop its final dividend for the 2019-20 financial year to allow it to build up its financial reserves for the coming financial year.

Seek announced on Monday that to fortify its balance sheet against the pandemic it was canceling of its final dividend and had restructured its debt.

Seek set an interim dividend of 13 cents a share for the six months to December 2019, but delayed payment until July 23. The decision to cancel its final came just 8 days later.

It paid a final of 22 cents a share for 2018-19.

Seek said it is operating within its debt covenants and has strong liquidity.

Last month Seek issued $75 million worth of subordinated notes to increase covenant headroom on its syndicated debt facility and redeemed $175 million worth of senior notes which means the earliest debt maturity of the group is now November 2022.

“The combination of our debt capital market transactions and the decision to not pay a final FY20 dividend increases our funding flexibility so we can continue to invest for the long term,” said Seek chief executive Andrew Bassat in the statement.

Seek did not give any trading details in Monday’s announcement.

The shares dropped 2.2% to $21.18.

Glenn Dyer

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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