Pearson Warns on Profit; Launches Cost-Cutting Plan
January 21 2016 - 3:00AM
Dow Jones News
By Simon Zekaria
LONDON--Pearson PLC (PSON.LN) Thursday again cut its full-year
earnings guidance, citing longer-than-anticipated trading impacts
in key markets, and unveiled a fresh cost-saving plan to drive
profit.
The education specialist expects to report adjusted operating
profit of approximately 720 million pounds ($1.02 billion) and
earnings per share of between 69 pence and 70 pence. It previously
forecast EPS to come in at the lower end of a range of 70 pence to
75 pence. In October, the company also cut its forecasts.
It intends to propose an unchanged final dividend of 34 pence
per share, giving a total dividend for 2015 of 52 pence per share,
up 2% year-over-year on 2014.
The group will take on restructuring costs of approximately
GBP320 million in 2016 and expects to book yearly savings of
approximately GBP350 million, with approximately GBP250 million in
2016 and a further GBP100 million in 2017.
In 2016, it expects to report operating profit and adjusted
earnings per share before restructuring costs of between GBP580
million and GBP620 million and between 50 pence and 55 pence,
respectively.
Pearson said it expects adjusted operating profit to be at or
above GBP800 million in 2018.
Pearson shares closed Tuesday at 658 pence, valuing the company
at GBP5.4 billion. The share price has dropped 45% in the past
three months.
Write to Simon Zekaria at simon.zekaria@wsj.com
(END) Dow Jones Newswires
January 21, 2016 02:45 ET (07:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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