Pearson confirms departure of chairman and guidance on profit

Pearson has confirmed the departure of its chairman Glen Moreno and its expectations for its highest profits since 2012 this year. 

The world's biggest education company by revenue, and owner of the Financial Times, said that Mr Moreno would step down within the next 12 months. He was appointed in October 2005 and is due to become chair of Virgin Money this year.  

Two other members of Pearson's board, David Arculus and Ken Hydon, will step down after Friday's general meeting. 

Earnings per share, assuming constant exchange rates and other factors, are expected to be between 75p and 80p this year, Pearson said, reiterating guidance given in February. 

The company has been weighed upon by weak demand in the US and the UK in recent years, with adjusted earnings per share falling to 66p last year. It has also sought to restructure its business to reflect the shift from print to digital products.

John Fallon, Pearson's chief executive, said that the company had "had a solid start to the year, in line with our expectations". In the first three months of 2015, a quiet trading period for Pearson, sales from continuing businesses were flat at £900m at constant exchange rates. 

Revenues declined in North America, which accounts for most of the company's sales, partly because of the timing of assessment sales. 

Earlier this month, the Los Angeles Unified School District informed Pearson and its partner Apple that it was cancelling a contract for the roll-out of iPads and learning software, saying it was "extremely dissatisfied" with their previous work. 

Among Pearson's "growth" markets, falling sales in South Africa offset rises in the English language business in China and in Brazilian learning systems. Pearson said the FT had seen "a strong growth in its digital circulation". 

Gareth Davies, an analyst at Numis, said that there was "no major divisional surprise".

Vivienne Cox, senior executive director and former BP executive, will lead the search for a successor to Mr Moreno. 

"The board and I have naturally been working on chair succession planning for several months now, and this is a good moment to formalise the process," said Mr Moreno.

"Pearson is in excellent shape, looking forward to some very good years under a strong executive team led by John Fallon."

Pearson's chief financial officer Robin Freestone has previously announced his departure in July. The changes will mean that most of Pearson's board has joined since Mr Fallon became chief executive at the start of 2013.

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