Pearson has seen its share price dip as it revealed sales last year were hit by cautious retail buyers holding back on purchases in the US.
The publishing firm’s business in North America saw revenues dip 4% in 2017 with sales in US higher education course books down 3%.
In the update, Pearson put weakening sales down to ‘cautious buying behaviour’ from its US retail partners in the fourth quarter.
Pearson’s North American business saw revenues dip four per cent in 2017
The news caused Pearson’s share price to fall some 6% before recovering some ground to a loss of just under 5%.
The company pointed to a lower number of US college enrolments and increased use of open educational resources as other factors behind the fall, and said it expected revenues to be flat or in single digit growth next year as a result.
‘Our restructuring programme is on track and our 2017 performance has set us up well to make further progress against our strategic priorities and grow profit in 2018,’ it said.
That restructuring has seen the firm sell off its Global Education unit in a £62 million deal last year, as well as the Financial Times newspaper and a stake in The Economist in 2015.
It also disposed of 22% of its 47% stake in Penguin Random House leaving a 25% holding, as well as selling a 44.75% stake in its Mexican online university partnership, Utel.
John Fallon, Pearson chief executive, said the restructuring programme was ‘on track’
It has instead focused on digital education, and grew US higher education digital courseware by around nine per cent over the year. It also reduced the rental price of 2,000 ebooks and saw revenues in the area rise 22%.
‘The group does not see a change in trends and highlighted the cautious buying behaviour of channel partners in the fourth quarter,’ analysts at Liberum said.
Pearson said it now expects 2017 adjusted operating profit of around £570 million to £575 million pounds. This is lower than previously indicated due to currency fluctuations but still towards to top of its guidance range.