Education group Pearson says 2020 sales fall 10%

Global education group Pearson said exam cancellations and school closures continued to drag in the final part of 2020, pulling down annual group sales by 10%, although it was on track to meet reduced market forecasts.

Pearson, which appointed former Disney executive Andy Bird as its new CEO in October, said that the exam cancellations and pressure on education spending had offset the growth in demand for online learning during the year.

For 2020, the British company said it expected to report adjusted operating profit in a range of 310 million pounds ($423 million) to 315 million pounds for the year, in line with consensus.

That is lower than the 332 million pounds analysts were forecasting in October, before further hits from new Covid-19 lockdowns and associated school closures.

Pearson has spent the last five years trying to adapt to a new digital market, a painful process resulting in multiple profit warnings, but the steps taken to invest in online services put it in a strong position to face the pandemic.

During 2020, global online sales grew 18% due to strong enrolments in virtual schools and it said that 70% of its US Higher Education Courseware was digital last year.

Pearson said that its balance sheet was strong and that it was on track to make cost savings of 50 million pounds during its full-year 2021. It will report its annual results on March 5.