Pearson sees 8% profit growth in 2022

Global education group Pearson expects to post an 8% increase in 2022, adjusted operating profit after strong demand for assessment and qualification that allowed it to enjoy a strong year-end.

The British company reported profit of 385 million pounds ($516 million) in 2021 and said it had recorded further revenue growth in 2022 and profit in line with current market expectations of 416 million pounds. It has struggled to stabilize the business since its traditional textbook model was wiped out in 2015 by digital sales and second-hand deals.

The company further added, “We expect the group to achieve a mid-single-digit revenue CAGR from 2022 to 2025 and margins to remain relatively flat in the near term as we invest to drive growth, improving d 2025 through mid-teens.”

Pearson endured a turbulent pandemic, fueled by demand for online learning services, hit by canceled exams and stalled late last year when Omicron and a tight US labor market deterred students from s enroll in community colleges.

Under former Disney executive Andy Bird, it has expanded its approach beyond traditional education outlets, selling directly to consumers through its Pearson+ app and to businesses looking to train staff.

Pearson’s assessment and qualifications division saw underlying sales growth of 18% in 2021, with virtual learning up 11% and English language learning up 17%, while that its higher education division, often the source of profit warnings, saw underlying sales down 5%, with growth in Canadian and UK tutorials offset by a 6% decline in higher education in the United States. He said he expects division revenue to decline in 2022, but less than last year.

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