Pearson records 2% revenue increase in first quarter

Pearson has announced a 2% increase in underlying revenue for the first quarter, with the company confirming its guidance for the year.

The education provider said revenues were up by 4% in the core markets of the UK, Australia and Italy, up 2% in the US and were flat in growth areas like China and Brazil.

Pearson’s guidance for 2019 was unchanged with expected adjusted operating profit of between £590m and £640m. The publisher also still expects to make £330m of savings exiting 2019, including job cuts, as it continues to transform its business to become a digital player.

It said trading at Penguin Random House, in which it has a 25% stake, was “in line with our expectations”.  Pearson also predicted a possible further decline in its US higher education courseware business this year, with net sales ranging from flat to -5%.

Pearson said it would launch a suite of digital products and capabilities for the back to school period this year including updates to Revel, its fully integrated digital courseware product, an AI powered maths tutor mobile app marketed to calculus students, and its first AI-powered essay marker, which will adapt to the professor’s personal style.

C.e.o. John Fallon said: “We are off to a strong start to the year, having laid good foundations in 2018. We continue to make progress against our strategic priorities, and we are bringing exciting new products and capabilities to market in 2019 which will continue to accelerate our move to digital. We expect our sales to stabilise this year and to increase our underlying profit further."

The company announced adjusted operating profit growth of 8% in its final 2018 report, following profit warnings over the previous five years. In March, it announced Fallon was paid £3.1m for last year, including bonuses from its annual and long-term incentive plans.

Pearson also announced today (26th April) it had appointed two non-executive directors to its board. Graeme Pitkethly, c.f.o. of Unilever PLC and NV, and entrepreneur Sherry Coutu, will join on 1st May.