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Pearson now expects full year underlying profit of around £385m. That’s a 33% improvement and ahead of expectations.
Trading in the fourth quarter saw sales growth in every segment, apart from Higher Education.
The shares rose 5.9% following the announcement.
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Full year trading details
In Assessment & Qualifications – the group’s largest division – sales rose 18%, largely because of a good performance from Professional Qualifications, which is the VUE business. Covid-19 recovery also meant there was positive trading in Clinical Assessment and US Student Assessment. VUE test volumes rose 30% to 16.8m.
Strong enrolment growth in the previous academic year helped Virtual Learning sales rise 11%, which included a 17% in Virtual Schools. Online Program Management (OPM) grew with good underlying enrolment growth of 7%.
Higher Education courseware sales ended the year down 5%, with improvements in the UK and Canada failing to offset declines in the US. The US managed growth in the fourth quarter, but for the second half as a whole US higher education courseware fell 9%, thanks to lower enrolments, courses per enrolment, and pricing pressure.
Sales in Workforce Skills and English Language Learning rose 6% and 17% respectively.
Pearson+, the group’s digital direct to consumer service now has 2.75m registered users. Of these 133,000 are paid subscriptions.
The disposal of Pearson’s Brazilian K12 Sistemas business completed on 1st October 2021.
The group said it had net debt under £400m and a ”strong cash performance”.
Pearson key facts
Price/Earnings ratio: 16.4
10 year average Price/Earnings ratio: 14.9
Prospective dividend yield (next 12 months): 3.3%
All ratios are sourced from Refinitiv. Please remember yields are variable and not a reliable indicator of future income. Keep in mind key figures shouldn’t be looked at on their own – it’s important to understand the big picture.
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