Pearson plc (LON:PSON) is slashing the dividend and cutting a further 3,000 jobs as it attempts to mitigate some of the damage caused by a slowdown in the US higher education market.
It said it was making “good progress” in simplifying the business and with its digital transformation as it announced it would shave a further £300mln from its cost base.
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Operationally, Pearson, which sells textbooks and electronic coursework, still appears to be bogged down.
Revenues were flat on a constant exchange rate basis at £2.05bn in the six months ended June 30, though it did emerge from the red, posting statutory operating profit of £16mln.
'Solid' first half?
Chief executive John Fallon called it a “solid” first-half.
“We are making good progress on our strategic priorities and our guidance for 2017 remains unchanged. We are focused on maximising performance through the critical second half,” he said.
"Strong cash generation, prudent management of our balance sheet and implementation of our transformation plans are positioning us to be the winner in digital education, and create long-term sustainable value for our shareholders."
Investors are sharing the pain with the pay-out set to fall to 5p from 18p, although Pearson has announced £300mln share buyback.
The company reiterated its earnings guidance for the year, which was taken positively by the market with the shares up 3% early on.