480 in the collection
Pearson Posts First-Half Profit: As Sales Gain in Schools Division
Buried in the article, you'll see that NCLB gets "credit" for rise in profits.
Pearson PLC, owner of Penguin books and the Financial Times newspaper, posted a first-half profit and reported a strong gain in sales in its main schools division, a sign that the company's long-promised education-driven revival is on schedule.
The London-based publisher said it is more confident of meeting its full-year target of sales increases of at least 10% at the school division. Pearson's management has predicted that 2005 will include a strong performance from the education business, which sells textbooks to state education systems and administers student testing.
"Basically, I think this is an indication that the strategy is working," Pearson Chief Executive Marjorie Scardino said yesterday.
[Marjorie Scardino]
Pearson posted net income of £346 million ($601.1 million), or 42.2 pence a share, for the first half, compared with a loss of £9 million, or 2.5 pence a share, a year earlier. This year's net-income figure included the sale of a Spanish newspaper publisher, Recoletos Grupo de Comunicación SA, which contributed £300 million to the result. Revenue rose 10% to £1.61 billion.
Pearson often generates a small loss in the first half, with profit coming in the second half, when many school authorities buy their textbooks. Under British accounting rules, Pearson reports results every six months.
Other divisions also reported improved first-half results. The Financial Times is expected to break even this year after several years of losses if advertising revenue continues to grow at the 5% rate reported during the first half, Pearson said. The Penguin book division, which has weighed down the company during the past year because of disappointing U.S. sales, showed signs of improvement, with sales up 5%.
Sales in Pearson's school division rose 19% to £518 million from £444 million in the year-earlier period as it started to receive payments from contracts to administer national school tests in the United Kingdom as well as for administering the Scholastic Aptitude Test and other exams under President Bush's "No Child Left Behind" law designed to improve school teaching.
Since becoming chief executive in 1997, Mrs. Scardino has overseen several large acquisitions such as the $4.6 billion purchase of Simon & Schuster's educational assets and the $2.5 billion acquisition of National Computer Systems Inc., a Minnesota testing firm. The company also has sold several holdings, including its stake in three units of the Lazard investment bank for £410 million. The moves were designed to focus Pearson on education and publishing businesses.
But Pearson's shares are trading around the same price they were when Mrs. Scardino, a former journalist, arrived as CEO. The shares rose 1.8% on yesterday's results to 680 pence in London, just 13.5 pence higher than when she became chief in 1997.
aaron.patrick@wsj.com.
— Aaron O. Patrick
Wall Street Journal
2005-07-26
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