Pearson gave a first quarter trading update April 24, ahead of its virtual annual meeting today. Sales in the company’s North American courseware and International businesses declined 10 percent, while the assessment business was down 3 percent. Partially offsetting these losses, the Global Online Learning business gained 6 percent in sales due to expanded enrollment and new school openings. Per their earlier warning in March, overall first quarter sales fell by 5 percent, “in line with revised expectations.” Importantly, “We have chosen not to furlough staff and are instead re-deploying people as much as we possibly can around the business […]
Publishers
Quarto Warns On Pandemic Impact, As Hudson Reports on Sales Declines
Quarto released full results for the year ended December 31, 2019, having already provided preliminary results in late March that showed a very modest profit amidst a steep sales decline in its second half. Adjusted operating profit remained flat, at $10 million. The new report is most notable for the company’s current “downside scenario analysis” trying to estimate “the impact of the Covid-19 outbreak on the Group’s trading and cash flow forecasts,” expecting “a material reduction in the group’s revenues and results for 2020.” So far, “the lockdown measures imposed across the globe have led to falling orders and revenues, […]
HMH Reduces Salaries, Withdraws Guidance and More
Following yesterday’s news that HMH Books & Media had temporarily closed its Indiana distribution center as the state is on lockdown, parent HMH issued a business update, announcing a series of cutbacks. The “majority of employees” have been reduced to a four-day work week, at pro-rated pay, while directors and top executives have taken a 25 percent cut in base cash compensation. The ceo has taken a 50 percent reduction in base salary, and “senior leadership” has also taken unspecified salary reductions. They say that all of their warehouses and distribution centers, with additional facilities in Illinois, Missouri, and Florida, […]
Quarto Reports Lower Sales, Marginal Profit in 2019
Quarto reported unaudited results for the year ending December 31, 2019, with sales of $135.8 million, down 9 percent from $149.3 million in 2018, but they returned to a modest after-tax profit of $2.9 million, compared to a loss of $600,000 in 2019. (Full results have not yet been filed with UK regulators, and no other measures — like pre-tax earnings — were provided.) Lead shareholder and ceo C.K. Lau said, “We expect to report profit for the year ahead of the prior year and this represents a pleasing result.” Revenue was just above flat six months ago, so all […]
Penguin Random House Gained On Foreign Exchange, Acquisitions, And A Little Growth
Bertelsmann reported sales for 2019 on Tuesday, with Penguin Random House showing gains in sales and profits, primarily from the stronger US dollar and a continuing string of acquisitions, plus decent “organic growth” of 1.5 percent. Topline sales of €3.636 billion were up €212 million from 2018, rising 6.2 percent. Operating EBITDA of €561 million was also up 6.2 percent, or €33 million, compared to €528 million a year ago — though here the result was lifted by an accounting change regarding lease expenses that looks to have provided a one-time boost on the order of €28 million. (Per our […]
Pearson Pauses Share Buyback, Citing “Prolonged Uncertainty”
Pearson “has decided it is prudent” to pause the rest of their planned £350 million share buyback, the company announced March 23. That repurchase program, under which they have already spent £167 million, was initiated in January as part of a plan to reinvest some of the expected proceeds from selling their remaining stake in Penguin Random House to Bertelsmann. (The sale is expected to close in the second quarter of 2020). Pearson estimated that the temporary closing of their Pearson VUE test centres will reduce operating profit by approximately £25 million to £35 million, and cancellations of state tests […]