PEARSON, the Owner of the Financial Times, Is Expected to Warn on Tuesday That the Growth in Revenues from Its Educational Publishing Business Has Slowed Sharply and That the Outlook for the Division Is Deteriorating with the US Economy
PEARSON, the owner of the Financial Times, is expected to warn on Tuesday that the growth in revenues from its educational publishing business has slowed sharply and that the outlook for the division is deteriorating with the US economy.
The trading statement will be the media and publishing group's first since it alerted investors to the likelihood that full-year profits at the FT Group would slump by 40% owing to a "dramatic drop" in advertising.
It is thought that the world's largest publisher of learning materials will single out the negative impact on sales in the US schools market from widespread cuts in state education spending.
Some of the media giant's biggest institutional shareholders say many investors have underestimated the effect of the American public expenditure downturn on education revenues, especially in the wake of 11 September.
Income from selling publications to US schools and colleges makes up more than half Pearson's total revenues of pound sterling4bn. Analysts estimate that school revenues will fall next year, compared with growth of 9% in the nine months to September.
Fund managers are also concerned about the performance of the company's publishing market for colleges, despite some broker optimism about the unit's business prospects. …