Pearson’s profits up but FT struggles

Steve Dinneen
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PEARSON’S profits shot up 13 per cent in the final quarter of last year and 17 per cent for the full year off the back of a strong performance from its education publishing business.

Revenue reached £5.6bn and adjusted operating profit was £858m, giving earnings per share of 65.4p. The results were ahead of analysts’ forecasts, which expected revenue of £5.44bn, adjusted operating profit of £808.7m and earnings per share of 63.41p. Pearson said it would raise its dividend by five per cent to 35.5p per share, slightly below the 35.66p forecast.

However, the results were soured as adjusted operating profits at FT Publishing, which prints the Financial Times and owns a stake in the Economist, plummeted 47 per cent to £39m. Its sales fell eight per cent to £358m. Circulation of the iconic newspaper fell by seven per cent to 402,799, although subscription circulation grew modestly. The number of paying subscribers increased by 15 per cent to 126,000 and registered users by 85 per cent to 1.8m.

Its Penguin business also fared badly, reporting a 10 per cent decline in operating profit to £84m, largely due to restructuring costs totalling more than £9m. This was stemmed by strong ebook sales, which shot up 400 per cent year-on-year. Overall, digital products and services accounted for almost a third of Pearson’s sales at nearly £1.7bn, double the total five years ago.

But the hero of the day was its education arm, which reported a 24 per cent increase in operating profit to £587m.