Publishers Lunch
Pearson provided a market update in advance
of their February 28 full-year earnings report, telling investors that adjusted
earnings per share will be lower than previously expected. Gross earnings are
in line with their previous expectations, but restructuring costs of £170
million were £20 million higher than forecast in October, and cost savings from
those changes were £10 million lower than planned.
They note that
"additional restructuring activity including an added warehouse closure
announced in late 2013." Pearson's shares were down roughly 8 percent in
early trading on the disappointing news.
Total gross operating profit for 2013 will
be approximately £865 million before restructuring charges, compared to £936
million a year ago, "primarily reflecting the associate accounting impact
of the Penguin Random House merger and lower underlying margins in North
American Higher Education, particularly in the important fourth quarter."
The statement notes that "Penguin
Random House benefited from a solid fourth-quarter publishing performance and
in its key selling season traded in line with the expectations that we set out
in our third quarter interim management statement."
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