London: British publishing group Pearson reiterated its forecast to at least match 2008 earnings this year after reporting first-quarter trading in line with its expectations.
Pearson, the world’s largest education publisher which also owns the Financial Times and Penguin Books, said on Friday it continued to expect adjusted earnings per share at or above last year’s level of 57.7 pence.
First-quarter sales rose 1% at constant currencies to £1 billion ($1.5 billion).
Pearson said it expected markets for US school publishing, financial advertising and consumer books to be tough, while it saw growth in testing, higher education and non-US education.
The company said it could not yet gauge the effect on its business of about $100 billion in new US funds earmarked for education as part of a federal stimulus package, on which some investors have pinned great hopes.
“The potential impact of this new money on our markets remains uncertain, but we believe that over the next two years it will help to stabilise state funds and stimulate innovation in education,” it said.
Pearson said the first tranche of $44 billion was distributed to states in April.
Shares in Pearson slipped 0.6% to 702 pence by 0808 GMT, underperforming the DJ Stoxx European media index, which rose 1.5%.
Pearson’s low exposure to advertising and high proportion of steady subscription revenues from educational products makes it a defensive favourite among media stocks, many of which have shrunk to a tiny proportion of their former value.
The stimulus package has further encouraged investors in Pearson, which reported weakness in US school publishing in 2008 due to market conditions.
“We believe Pearson will prove more resilient than the market expects, and the confident tone from the company is reassuring,” UBS wrote in a note.
Pearson shares have risen 21% this year so far, compared with a flat performance by Reed Elsevier, a fellow professional publisher focused on the scientific and legal markets.