Pearson share price: Company publishes full-year financial report

Pearson Plc (LON:PSON) today released its financial report for 2014. Key information from the report provided below., with more to follow:

**2014 FINANCIAL HIGHLIGHTS:** Sales up 2% at CER to £4.9bn reflecting good growth in digital and services and the acquisition of Grupo Multi partly offset, as expected, by the impact of school curriculum change in the US and the UK, our two largest markets, and a smaller school textbook adoption in South Africa; Deferred revenue excluding Mergermarket up 10% at CER to more than £800m as a result of further good progress in our digital and services businesses; Adjusted operating profit (excluding Mergermarket) up 8% at CER to £720m (2013: £710m) with lower net restructuring charges (£44m in 2014; £135m in 2013) and the contribution from Grupo Multi partly offset by increased investment levels and revenue mix;Adjusted EPS of 66.7p (2013: 70.1p) reflecting exchange rate movements and a higher tax rate of 17.9% (2013: 14.6%); Operating cash flow £649m (2013: £588m) benefiting from improved working capital from deferred revenue growth and an increased dividend from Penguin Random House, partly offset by increased investment levels; Dividend raised 6% to 51p, our 23rd straight year of increasing our dividend above the rate of inflation.

**2015 FULL YEAR OUTLOOK:** Based on exchange rates at the time of our 21 January 2015 trading update, we expect to report adjusted earnings per share of between 75p and 80p in 2015;
2015 profits to reflect: stabilisation of cyclical and policy-related factors in our largest markets; currency movement impact on revenues, operating income and interest charge (with Sterling weakness against the US Dollar partly offset by strengthening against the Euro, Australian Dollar and key emerging markets currencies); the benefits of 2014 restructuring partly offset by normal levels of net restructuring of approximately £30m to continue to reshape our business; and shared services costs remaining with Pearson following withdrawal of Penguin.

Process to explore the possible sale of PowerSchool initiated.
**STRATEGIC OUTLOOK:** Pearson’s strategy centres on a significant and exciting long-term opportunity: the sustained and growing global demand for greater access, achievement and affordability in education; We can meet this demand by accelerating our shift to digital, services and to fast-growing economies, and committing to deliver measurably improved learning outcomes (efficacy); We are investing in learning services, inside services, direct delivery and assessments and qualifications, and in school, higher education and English language learning. We are organising around a smaller number of global products and platforms, built around a single, world-class infrastructure and common systems and processes; We believe cyclical pressures will ease as curriculum change is implemented in the US and UK and US college enrolments stabilise and, in due course, return to growth; This strategy will enable us to empower more people to progress in their lives through learning. It also provides Pearson with a larger market opportunity, a sharper focus on the fastest-growing markets and stronger financial returns in 2016 and longer term.
**John Fallon, chief executive said:** “We’ve completed our intense two year restructuring and reinvestment programme and performed well competitively despite some challenging market conditions. We enter 2015 better placed to have a bigger impact on student learning through the combination of new technology and best teaching practice. This will enable us to empower more people to progress in their lives through learning and grow our market opportunity.”
As of 07:25 GMT, Friday, 27 February, Pearson plc share price is 1,396.00p.