Pearson Plc (PSON), the publisher of the Financial Times newspaper, reiterated its full-year earnings forecast and said its restructuring and investment program is on schedule to speed growth next year.
The shares rose as much as 4.1 percent. Adjusted earnings per share will be 62 pence to 67 pence in 2014, London-based Pearson said in a statement today. Profit will be heavily weighted to the second half, it said. First-quarter sales dropped 6 percent on a stronger British pound versus the U.S. dollar, according to the statement.
“Pearson has had a solid start to the year, in line with our expectations,” Chief Executive Officer John Fallon said in the statement. “Our major program of restructuring and investment is on track and will drive a leaner, more cash-generative, faster-growing business from 2015.”
Pearson, which earns about 60 percent of revenue in the U.S., has blamed lower freshman enrollments and bookstore purchases for reducing earnings in the country. Pearson has also been reorganizing to speed growth in emerging markets and digital services as a slowdown in some large textbook markets restrains profit.
The stock was the biggest riser on the FTSE 100 Index, advancing 2.7 percent to 1,078 pence at 9:40 a.m. in London.
Pearson’s “solid” first-quarter sales update features no surprise for the market, though continued strengthening of the British pound remains a “headwind,” analysts at Numis Securities in London said in a note.
First-half adjusted operating profit and adjusted earnings per share are set to be lower this year, Pearson said.
The company in February said it wouldn’t emerge from a difficult transition period until 2015 after earnings plunged on weak demand in U.S. higher education and restructuring costs. Pearson, which spent about 176 million pounds reorganizing last year, forecast in January that net restructuring expenses will be about 50 million pounds in 2014 and it will invest about 50 million pounds to expand digital operations and businesses in emerging markets.
The company also said in January that trading conditions will remain challenging this year, with declining college enrollments in North America, its largest market. Business in the U.K. will also also be hurt by curriculum changes affecting schools.
Bloomberg LP, the parent of Bloomberg News, competes with the Financial Times in providing financial news and information.
In December, Pearson agreed to buy Grupo Multi, an English-language training company in Brazil, for about 440 million pounds to accelerate growth in its education business.
To contact the reporter on this story: Kristen Schweizer in London at email@example.com