24th Jul 2015 06:36
LONDON (Alliance News) - Pearson PLC Friday reiterated its outlook for 2015 and raised its interim dividend as it posted a widened pretax loss for the first half of 2015, a day after it announced the sale of the Financial Times.
The company agreed Thursday to sell its FT Group, which includes Financial Times newspaper, to Japanese media group Nikkei Inc for GBP844 million in cash as it moves to focus solely on its education businesses. The deal doesn't include the sale of property at One Southwark Bridge in London - the home of the FT newspaper - nor Pearson's 50% stake in the Economist Group, which publishes the Economist magazine.
The sale is subject to a number of regulatory approvals and is expected to close during the fourth quarter of 2015.
Pearson reiterated its expectations for adjusted earnings per share of between 75 pence and 80 pence in 2015 - assuming the ownership of PowerSchool and the FT Group for the entirety of 2015. Pearson sold the PowerSchool business for USD350 million in June, and said that including this sale, its guidance its reduced by around 1 pence, and cautioned that if current exchange rates persist it will reduce earnings per share of around 2 pence.
Pearson posted a pretax loss of GBP115 million for the half year to end-June, widened from a pretax loss of GBP36,000 a year before, as a rise in sales to GBP2.16 billion from GBP2.05 billion was offset by higher cost of goods sold and operating expenses. The company also recorded a GBP70 million impairment related to the PowerSchool sale.
It posted adjusted earnings per share, excluding the sale of its Mergermarket business, of 4.4 pence, down from 4.7 pence a year before.
Pearson proposed an interim dividend of 18 pence per share, increased 6% from 17.0 pence a year before.
The company said that due to seasonal bias in some of its business, it makes a higher proportion of its sales and a majority of its profits in the second half, during which the North American school year begins.
"Overall, we're competing well, enabling us to reaffirm our full year guidance and increase the interim dividend. The new education products and services we're developing which will enable far more people of all ages to discover the joy of learning and progress in their careers. We believe the returns on the significant investments we are making to achieve this goal will be substantial for students, society and our shareholders," said Chief Executive John Fallon in a statement.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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