Published January 21, 2013
Pearson (PSO) cut its outlook for 2012 on Monday, following the closure of an acquired business.
The company said it anticipates earnings of around 84 pence a share, or $1.33, down from its previous estimate of 84.9 pence a share, or $1.35.
Pearson, a U.K.-based company that publishes the Financial Times and school textbooks, announced two weeks ago that it would close Pearson in Practice, an apprenticeship business acquired for $157.1 million in 2010. The company wrote down $190.5 million in relation to the purchase, as changes to government rules on hiring apprentices hurt the business. Companies can now bid for government funding for apprenticeship programs and operate these programs themselves. Previously, companies were required to use companies like Pearson in Practice.
Pearson said it expects modest revenue growth for its North American education business, its largest unit, and hopes to gain market share. Operating profit last year should hit £935 million, or $1.48 billion, Pearson added. That is level at constant exchange rates when compared to the £942 million, or $1.49 billion, in profit Pearson recorded in 2011.
Pearson’s 2012 financial results, which are scheduled to be released on Feb. 25, will be the last under outgoing chief executive Marjorie Scardino. John Fallon, currently the top executive for Pearson’s international education unit, is set to take over this year.
Pearson moved lower on the FTSE100 index in early-morning trading Monday in London. In U.S. trading, shares closed Friday at $19.71 a share, up 3% over the last 52 weeks.