21st Feb 2020 07:59
(Alliance News) - Pearson PLC on Friday said its financial performance worsened in 2019 amid restructuring costs, but said it expects to grow profitability going forward.
Pearson said its sales decreased by 6% in headline terms in 2019 to GBP3.87 billion from GBP4.13 billion a year earlier, with portfolio changes reducing sales by GBP347 million. On the other hand, the company said it benefited from currency movements, which increased revenue by GBP97 million.
Stripping out the impact of portfolio and currency movements, revenue was flat in underlying terms, the company noted.
Pretax profit was lower, at GBP232 million compared to GBP498 million a year ago, hurt by the reduced gains on disposals and higher restructuring charges.
The FTSE 100-listed company believes that "the future of learning will be increasingly digital" and, therefore, it is restructuring to meet its clients needs.
Looking ahead, Pearson said it expects to deliver 2020 adjusted operating profit of between GBP410 million to GBP490 million, excluding the recently sold 25% stake in Penguin Random House. The disposal generated USD675 million net proceeds.
In 2019, adjusted operating profit totalled GBP581 million, up from GBP546 million in 2018, reflecting a GBP130 million year-on-year benefit from restructuring, and other benefits, including operational factors, FX and the adoption of IFRS 16 accounting standard.
"As we benefit from further efficiencies from the investments we have made and deploy our strong balance sheet, Pearson is now well placed, in time, to grow in a profitable and sustainable way," said Chief Executive John Fallon.
Pearson declared a final dividend of 13.5 pence, up 4% from 13p paid a year earlier. For 2019, payout totalled 19.5p compared to 18.5p paid the year before.
In January, the London-headquartered company started a GBP350 million share buyback programme in connection with the sale of its 25% interest in Penguin Random House. Pearson has completed GBP79 million of the share buyback so far.
By Evelina Grecenko; [email protected]
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