Booming sales of adult education products and increased advertising revenue at the Financial Times have put Pearson on course for a record year, the company said yesterday.
The company increased its guidance for performance at its core education business, raising its forecast for the professional education division for the second time this year.
Advertising revenue at the FT Publishing business rose 9 per cent in the first nine months of this year and accelerated after the first half. Advertising at the FT newspaper and its ft.com website held up well during the recent market turmoil as both increased their readerships, Pearson said.
The company said it expected strong underlying growth on all its key financial measures of earnings, cash generation and return on invested capital.
"We still have a lot of trading ahead of us, but every part of the company is doing well," Marjorie Scardino, Pearson's chief executive, said. Operating profits rose 20 per cent in the first nine months of the year.
Pearson has refocused on professional education, business-on-business readers and providing tests for nurses, financial professionals and others. After selling its Government Solutions business at the end of last year, it has bought a financial data provider, an international education business and a US online learning operation.
Pearson predicted sales growth for the business of up to 10 per cent and widening margins. Growth areas included driving theory tests and nurses exams.
At its schools business, Pearson reported gains in market share in US school publishing and testing and good growth outside the US.
The higher education business attracted more than 1.3 million US students to online learning programmes as students returned to college in August and September, a 44 per cent increase on a year earlier.
"We remain confident the education assets will be relatively resilient and the results today should reassure the market," UBS analysts said.
Pearson's shares have been weighed down in recent months because of concerns about economic prospects in the US, where the company gets about two-thirds of its sales. The shares were the fifth-best performers on the FTSE 100 index yesterday, rising 1.4 per cent to 776p.
Pearson said it was still in talks to sell Les Echos, the French business newspaper, to LVMH, the luxury goods company. It did not comment on a proposed sale of its 50 per cent share of FT Deutschland, the FT's only foreign-language edition, to the publisher of Der Spiegel in Germany.
The company also owns Penguin books, which gained sales from publishing The Age of Turbulence by Alan Greenspan, the former head of the US Federal Reserve. Pearson predicted an improving full-year profit margin at Penguin.
Mrs Scardino said: "We're benefiting from rapid take-up of our learning technologies, sustained increases in our audience and advertising at the FT, and bestselling publishing combined with operating efficiency at Penguin. This increases our confidence that 2007 will be another year of record profits for Pearson."Reuse content