Pearson: expects operating profit to fall in 2020
(CercleFinance.com) - UK publisher Pearson said it expects a drop in headline profit this year, citing continued market pressure in its US higher education business.
The educational publisher said it expects to report 2020 adjusted operating profit of between 410 million pounds to 490 million pounds after excluding its 25% stake in Penguin Random House.
In 2019, its adjusted operating profit rose to 581 million pounds, from 546 million pounds in 2018, an increase that reflected a 130 million pound gain from restructuring.
Its sales, however, decreased to 3.9 billion pounds last year, compared to 4.1 billion pounds in 2018, due to portfolio changes that have sliced off about 350 million pounds from its sales.
Stripping out the impact of portfolio and currency movements, revenue was flat in underlying terms, Pearson said.
Chief executive John Fallon pointed out that over 75% of the company is now growing strongly, with all businesses profitable.
Yet, the Pearson share was down 3% at 566.6 pence on Friday morning, significantly underperforming a 0.5% drop in the FTSE 100 index.
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