Pearson Sees Lower Profit In FY16; Announces Cost Saving Plans - Quick Facts

(RTTNews) - British publishing and education company Pearson plc (PSO, PSON.L) announced Thursday that for fiscal 2015, the company expects to report adjusted operating profit of approximately 720 million pounds and earnings per share of between 69 pence and 70 pence.

The company added that it intends to propose an unchanged final dividend of 34 pence per share giving a total dividend for 2015 of 52 pence per share, up 2% on 2014.

For fiscal 2016, the company expects to report operating profit of 580 million pounds and 620 million pounds and adjusted earnings per share before the costs of restructuring of between 50 pence and 55 pence. Operating profit after restructuring charges is expected to be in the 260 million pounds to 300 million pounds range.

Further, the company said it is taking further action to simplify business, reduce costs and position itself for growth in major markets. The company will complete the majority of these actions by mid-year and incur implementation costs of approximately 320 million pounds in 2016 and expect to generate annualised savings of approximately 350 million pounds. Of this, approximately 250 million pounds savings will be in 2016 and a further 100 million pounds of these savings in 2017.

For fiscal 2018, the company expects adjusted operating profit to be at or above 800 million pounds.

Pearson plans to hold its dividend at the 2015 level while it rebuilds cover, reflecting the Board's confidence in the medium term outlook.

Pearson's chief executive John Fallon said, "Our competitive performance during the last three years has been strong, but the cyclical and policy related challenges in our biggest markets have been more pronounced and persisted for longer than anticipated."