(Sharecast News) - Educational publisher Pearson reported underlying first quarter revenue growth of 5% driven by demand for global online learning as it maintained annual guidance.
The company on Monday said its online division revenue increased 25% with strong growth in Virtual Schools due to enrolment growth in the current school year in Partner Schools as well as in US district partnerships.
International sales were down 2% with a decline in English as Covid-19 continued to impact Pearson's courseware and franchise business in Latin America, despite courseware recovery in China.
North American Courseware revenues rose 1%, as the division benefited from increased funding and a sales shift to digital in Canada, which offset declines in the US.
"We continue to expect to deliver revenue and profit growth in 2021 and for our performance to be in line with our 2021 outlook as we benefit from improving trading conditions as Covid-19 restrictions ease," said chief executive Andy Bird.
"We are making good strategic progress in our ongoing shift to digital, we are in the advanced stages of preparation for the forthcoming launch of our new college app and our organisational redesign is on track."
Hargreaves Lansdown analyst Sophie Lund-Yates said the coronavirus pandemic "has massively increased the demand for digital testing and learning, and lit a fire underneath Pearson's efforts to rejuvenate".
"On paper, the idea has a lot of merit. Digital courseware sales should be more lucrative, and a digital subscriber base should mean a higher proportion of revenue is recurring.
What's really encouraging is numbers from the first quarter show things are moving in the right direction, with very strong demand for Global Online Learning. The North American courseware business is still sluggish, but an increase in sales, however small, is a big green tick for Pearson."
Pearson (PSON)19 Apr 2024 13:09