Education giant Pearson has hiked its dividend for the first half of the year as it swung back to a profit following a torrid pandemic year.
The FTSE 100 firm today reported an adjusted operating profit of £127m for the six months to the end of June, compared to a loss of £23m in the same period last year.
As a result, the company said it would pay an interim dividend of 6.3p per share, up five per cent on last year.
It came as Pearson posted a 17 per cent increase in revenue to £1.6bn as the post-pandemic recovery boosted trading and the group’s shift towards a direct-to-consumer business model paid off.
The growth was driven by a 25 per cent rise in its global online learning division, with particularly strong performance for US virtual schools as more students enrolled online during lockdown.
Global assessment grew by a third with growth across all divisions, following the closure of test centres and schools, as well as exam cancellations, in 2020.
Pearson said it had a strong balance sheet with net debt of £646m, down from £982m at the end of the first half last year.
Shares in Pearson slipped one per cent in early trading.
The education group last year tapped former Disney executive Andy Bird as its new boss and has since launched a new consumer division in a bid to tap into the success of streaming services such as Netflix.
Pearson today unveiled the launch of Pearson Plus, a new college learning app for US students that offers access to ebooks and study tools.
It said the app would enable a direct relationship with millions of students and help the company win back business from consumers opting to buy textbooks second-hand.
Bird said the app “looks and feels like the rich media experience students use to consumer news, music and movies”.
“Clearly Disney Plus has been a huge success in the field of media and entertainment and we aspire with Pearson Plus to deliver the same consumer-grade product,” he added.
Pearson maintained its forecasts for the second half of the year and said adjusted operating profit would be in line with previously-stated consensus of £377m.
“Pearson has made good strategic, operational and financial progress in the first half of 2021 leading to healthy revenue and profit growth in the period,” said chief executive Bird.
“Whilst there’s still much to do in the second half, with the key back to school selling season ahead of us and notwithstanding ongoing COVID-related uncertainty in some of our major markets, we are moving with pace and purpose and we remain on track to meet current market expectations.”