Pearson warns of another tough year after earnings fall
British education and media group Pearson warned it expected tough market conditions to continue in 2013 after weak trading in its key fourth-quarter selling season hit earnings last year.
The Financial Times newspaper and Penguin books publisher said it now expects to report on Feb. 25 adjusted earnings per share of around 84 pence for 2012, below the 84.9 pence it had said it expected in October, due to restrained government funding on education in developed markets and weak advertising.
The result had already expected to be down on the previous year's earnings of 86.5 pence a share due to last year's sale of its 50 per cent stake in the FTSE International market indexes business to the London Stock Exchange which it said contributed 2.2 pence a share to earnings in 2011.
"If you look at the statement it's pretty clear that 2013 is going to be another grim year," Liberum analyst Ian Whittaker said.
"Overall it's a weak statement, it's a downgrade to guidance and the mere fact they've had a downgrade to what is seen as a defensive stock is likely to drive a negative reaction."
Shares in the group were down 3 percent at 1202 pence by 0903 GMT, back to the level they were trading at at the start of the year following a jump last week. The weakening conditions come at a time of widespread change for Pearson - for years one of the most stable media groups in Britain.
Marjorie Scardino stepped down at the end of last year
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