Pearson, the FTSE 100-listed publishing group, reported full-year profits in line with the top end of its own forecasts on Friday, delivering also an upbeat assessment of its prospects in 2018.
After a painful operating loss of £2.5bn in 2016, any return to profit would have been welcomed. Its full-year statutory operating profit hit the top end of its own forecasts at £451m.
Full-year financial highlights
- Sales down 1% on 2016 to £4.51bn
- Profit for the year of £408m after a loss of £2.34bn in 2016
- Cash generated from operations £462m, down 11%
- Net debt reduced to £400m, from £1.1bn in 2016
- Basic earnings per share of 49.9p after a loss of 286.8p a share in 2016
- Dividend of 17p, down from 52p in 2016
In 2018, the company expects to report operating profit between £520-£560m. The company said it would continue its efficiency programme, targeting £300m of annual cost savings by 2020 through simplification of technology enabling standardised processes that would allow it to reduce headcount.
The company did not state how many jobs would be lost in 2018 or beyond.
Chief executive John Fallon (left) said: "Pearson has made good progress against its strategic priorities in 2017 with further simplification of the portfolio, strengthening of our balance sheet and delivering results at the top end of guidance.
"We are confident we will make further progress against our strategic priorities and grow underlying profit in 2018."
Investors welcomed the strategic announcements and return to profit in 2017. The share rose 3.01% to 726p in mid-morning trade on the London Stock Exchange.