The Bookseller.com

2nd December 2008

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Shares rise at 'resilient' Pearson

28.07.08 Catherine Neilan

Pearson's share price has risen solidly in trading so far today (Monday, 28th July), on the back of strong interim sales up 14%, and adjusted operating profits up 38%. The share price reached a high of 617p, up by more than 2%, before closing at 606p, 10.5p ahead of Friday's closing price.

The results were ahead of analysts' expectations, prompting the share interest. Media specialist Paul Richards at analyst Numis Corporation, said: "Pearson is certainly better off than we were looking for. Everyone appreciates the difficult environment they are working in, but they have delivered a strong performance." Numis planned to retain its "add" recommendation as a result, he added. "[Pearson is] in US education, global consumer book sales and financial information, so they are not as exposed as a lot of media companies we look at. We are very much of the view Pearson is at the most resilient end of the spectrum."

Pearson's share price has dropped 20.74% over the past year, but Richards said that it had held up well compared with other media stocks. "That is good performance relative to the sector," he said. "Pearson has been one of the star performers. The next couple of years will be hard for everyone, but Pearson is a well positioned, well invested company, and things will particularly go its way in 2009-2010."

Penguin recorded sales growth of 9% and FT Group increased by 11%, but Pearson Education saw the strongest movement, up 17% on last year. The educational arm of the publishing house accounted for 60.2% of first half sales, which totalled £1.97bn, up from £1.7bn in 2007.

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