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Pearson PLC on Friday raised its dividend and said it is on track to deliver guidance, expressing confidence of stronger growth in the second half of the year. The London-based publisher of digital and virtual learning materials said pretax profit increased 2.8% to £218 million in the first half of 2025 from £212 million a year prior, while basic earnings per share were up 7.4% to 24.8 pence from 23.1p. Profit growth was driven by operating leverage on sales growth, gains on disposals and the reversal of impairments on property assets, partially offset by inflation and currency headwinds. Shares in Pearson were 4.9% higher at 1,125.00p each in London on Friday morning. Sales were down 1.7% to £1.72 billion from £1.75 billion a year ago, but rose 2% on an underlying basis with each business unit ‘performing broadly in line with our expectations.’ Free cash flow improved to £156 million from £27 million, including the receipt of GBP£114 million state aid tax recovery. The firm raised the dividend by 5.4% to 7.8p from 7.4p a year ago, and said the £350 million share buyback programme is ‘well underway’. Chief Executive Omar Abbosh said: ‘We are making rapid progress with bringing AI-powered products to market and are scaling and enhancing our enterprise business with a range of new partnerships and deals.’ Pearson expects sales growth and adjusted operating profit in line with market expectations in 2025, with stronger sales growth in the second half, especially in the fourth quarter. The market consensus is for underlying sales growth of 4.4% and adjusted operating profit of £656 million. Beyond 2025, Pearson said it is positioned to deliver a mid-single digit underlying compound annual sales growth, sustained margin improvement that will equate to an average increase of 40 basis points per annum and strong free cash conversion5, in the region of 90% to 100%, on average, across the period. Assessment & Qualifications sales were up 2% with strong growth in Clinical Assessments and UK & International Qualifications, partially offset by declines in Pearson VUE and US Student Assessment. Virtual Learning sales were down 1%, as expected, while Higher Education sales were up 4%, benefiting from growth in Inclusive Access of 21% and US digital subscriptions of 3%. English Language Learning sales were down 3%, in line with expectations, with Institutional impacted by a strong comparator period in the first half of 2024. Enterprise Learning & Skills sales were up 4%, with another ‘solid’ performance in Vocational Qualifications and Enterprise Solutions building momentum. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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