Pearson reports 'strong' 2023 with underlying sales up 5%

Pearson had a "strong” 2023 with group underlying sales for the full year up 5% and adjusted operating profit up 30% to approximately £570m-£575m according to partial figures released in an unaudited trading update.   

This was driven by Assessment & Qualifications and English Language Learning, Pearson said. The publisher also revealed its cost efficiency programme had delivered £120m of savings and that it was “encouraged” by how students are engaging with its generative AI study tools. Pearson said it will be expanding the current beta to many more MyLab and Mastering titles by autumn 2024.  

Omar Abbosh, chief executive, said: “I am excited to be leading this high quality, purpose-driven company and I would like to thank Andy [Bird, who recently retired] for the strong progress made under his leadership. Pearson saw strong strategic and operational progress in 2023 leading to financial performance ahead of our initial expectations. The group is well positioned to seize growth opportunities and deliver long-term future value for all of our stakeholders. I look forward to leading the next phase in Pearson’s ongoing evolution.” 

Assessment & Qualifications sales were up 7% for the full year. There was also good growth across US Student Assessments, Clinical and UK & International Qualifications, due to new contract wins, good government funding and price increases, the publisher said. As expected, Q4 sales growth of 3% was slower than in previous quarters due to contract phasing. 

Virtual Learning sales decreased 20% for the full year, primarily due to an 87% expected decrease in the OPM [Online Program Management] business given the previously announced ASU contract loss. Virtual Schools sales declined 2% for the full year, with enrolments for the 2023–2024 academic year lower due to the previously announced loss of a larger partner school. Excluding this impact, enrolments were up 1%. Virtual Schools sales grew 5% in Q4, primarily driven by improvements in funding, as well as growth associated with the launch of Connections Academy Career Pathways. 

Higher Education sales were down 3% for the full year, in line with expectations, driven by loss of adoptions to non-mainstream publishers in the first half of the year, as well as pricing mix.  

Pearson+ performed well with 3.03 million registered users and 516,000 paid subscriptions, representing 27% growth compared to the prior year fall semester. Pearson+ passed the milestone of 1 million cumulative paid subscriptions for the calendar year. 

English Language Learning sales increased 30% for the full year while Workforce Skills sales grew 11%, with a solid performance in both Vocational Qualifications and Workforce Solutions. Sales grew 28% in Q4, driven by strong growth in BTECs, both in the UK and internationally. 

Audited full year results will be announced on 1st March 2024.