- Shares up nearly 4% to 900p
- English Language sales increased 44%
- Assessment & Qualifications sales up 7%
Shares in Pearson (PSON) were up nearly 4% to 900p in early trading as the education publishing group reported a 44% increase in underlying adjusted operating profit to £250 million for the six months to 30 June 2023.
Adjusted earnings per share grew 25.6p compared to 22.5p in the first half of 2022 ‘reflecting adjusted operating profit growth, tax and interest and the reduction in issued shares given the 2022 share buyback,’ the company said.
GENERATIVE ARTIFICIAL INTELLIGENCE ADVANCES
Chief executive Andy Bird told journalists on a media call that the education publishing group had made advances in integrating generative AI across its businesses including AI-based response assessments within English Language Learning and large language models within Workforce Skills.
Pearson has also recently brought to market a generative AI tool within its Pearson+ service which enables users to automatically summarise the content of channel videos into bullet points.
The education publishing group is looking to develop additional generative AI study tools going forward ‘designed to help students better learn and understand challenging subjects’ within its Person+ and Mastering divisions for the US ‘back to school’ market this Fall.
Other highlights include Pearson’s growing market share in India and a contract with the Jordanian Ministry of Education to reform Jordan’s technical and vocational education and training provision in schools for the next three years.
Bird told journalists the education publishing group had identified India as a ‘key growth market.’
REAFFIRMING GUIDANCE
Pearson saw a 2% fall in Higher Education sales due to currency movements, and Virtual Learning sales decreased 15% due to currency movements and portfolio changes.
Virtual Schools sales were down 2% driven by enrolment declines for the 2022/23 academic year, reflecting students continued return to the classroom post pandemic.
However, the company reported strong operating cash flow performance of £79 million for the six months to 30 June 2023.
Bird also reaffirmed the group's medium term and full year guidance of mid-single digit group revenue growth over 2022 to 2025 and ‘for margins to rise to the upper end of mid-teens in 2025.’
Disclaimer: The author (Sabuhi Gard) owns shares in Pearson.
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