Pearson Returns to Profit in 2017; Cuts Dividend

   By Adria Calatayud 
 

Pearson PLC (PSON.LN) said Friday that it swung to a pretax profit in 2017 after booking a large impairment charge in 2016, but cut its dividend for the year.

The London-based publishing and education company also said that it is in discussions with potential buyers for its U.S. K12 courseware segment, which Pearson said in May 2017 it was considering disposing.

The company made a profit of 421 million pounds ($586.1 million), compared with a pretax loss of GBP2.56 billion in 2016. Analysts expected a pretax profit of GBP246.9 million, according to a consensus based on seven estimates provided by FactSet.

Pearson's 2017 net profit was GBP406 million, compared with a net loss of GBP2.34 billion a year earlier, the company said.

Revenue decreased 0.9% to GBP4.51 billion, from GBP4.55 billion in 2016, Pearson said. Analysts forecast revenue at GBP4.58 billion, according to a consensus provided by FactSet. The company said the sale of some assets hit revenue.

Adjusted operating profit--which is the company's preferred earnings measure--was GBP576 million, down 9.3% from GBP635 million a year earlier. This compares with guidance of adjusted operating profit of between GBP570 million and GBP575 million.

Pearson backed the 2018 guidance it gave in January, when the company said it expected adjusted operating for 2018 of between GBP520 million and GBP560 million and adjusted earnings per share of 49 pence to 53 pence.

The board slashed its final dividend for 2017 to 12 pence a share, compared with 34 pence a share a year earlier. This leaves total dividends for the year at 17 pence a share, below total dividends of 52 pence for 2016.

Write to Adria Calatayud at [e-mail]

(END) Dow Jones Newswires

February 23, 2018 03:01 ET (08:01 GMT)

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