Bird reorganises Pearson as Bristow leaves

Pearson has unveiled a new strategy which will see the publisher reorganised into five new business divisions, while Rod Bristow, president of Global Online Learning, leaves the company.

The publisher has also announced its intention to occupy "significantly" smaller office spaces in the future.

The strategy, unveiled by new c.e.o. Andy Bird as Pearson announced its 2020 results, confirming the 10% revenue fall it revealed earlier this year, will see the company reorganised into five business divisions — Virtual Learning, Higher Education, English Language Learning, Workforce Skills, and Assessment and Qualifications — with the Direct to Consumer business sitting alongside all five.

Pearson is also "strategically reviewing" its international courseware local publishing, including in Canada, the company said.

Bristow leaves the business after 35 years. "He has made a significant contribution to Pearson over this time, leaving our UK and online learning businesses in good shape and well placed for future growth," the company said. Meanwhile Tom ap Simon, currently head of the Virtual Schools business, is to lead the newly created Virtual Learning division and Mike Howells, chief strategy officer, will be interim president of Workforce Skills.

The publisher also said it would simplify its property portfolio and occupy "significantly smaller square footage".

It predicted a cost of £40m-£70m in 2021 for the business reorganisation, while the restructure of the office space would involve a P&L charge of £130m in 2021 and a cash cost of £10m, "with a recurring benefit of £10m in 2022 rising to £20m per annum in later years".

Bird said the company had put in a "solid" 2020 performance. Sales decreased 12% year on year to £3,397m, with an underlying revenue decline of 10%. Global Online Learning was up 18%, "reflecting increased demand for virtual learning", but Global Assessment was down 14% and International down 19%. North American Courseware was down 13%. Operating profit stood at £411m, up from £275m in the previous year because of the gain on the sale of its stake in Penguin Random House and lower restructuring costs.

"Despite the significant challenges of 2020, it is thanks to the tenacity and commitment of colleagues around the world that Pearson has delivered a solid financial performance. This year, as we recover from the impact of the pandemic, we are focused on delivering revenue and profit growth," Bird said.

"Our purpose has never been so relevant: we exist to help everyone achieve their potential through learning. I have witnessed this first-hand every day since joining Pearson, having spent time with customers, employees and other key stakeholders. I have enormous optimism in the future and our ability to unlock our potential and drive sustainable growth.

"Pearson's strategy is now geared around three key demand-led global market opportunities which play to all our strengths: the rise in online and digital learning; addressing the workforce skills gap; and meeting the growing demand for dependable accreditation and certification. Our existing assets, strong balance sheet, new organisational structure and priorities will enable us to seize these opportunities. As the global leader in learning, nobody else has the breadth and depth of experience, scale, expertise and relationships across the entire lifelong learning spectrum.

"Following significant investments in technology and comprehensive restructuring, Pearson is moving at pace and ready to enter a new era as a digital-first company, focused on delivering sustainable revenue and profit growth for the benefit of all company stakeholders."