* Difficult U.S. market stabilises
* Demand for online learning jumps
* Shares up 3%, group reiterates outlook
(Adds reaction, shares, background)
By Kate Holton
LONDON, April 26 (Reuters) - Pearson's switch to
become a digital provider of global education services gathered
momentum in the first quarter with demand for eBooks, digital
courseware and online learning helping it to outperform
expectations.
Shares in the British company rose 3% as analysts said a 5%
rise in underlying revenue growth indicated a stronger
trajectory than expected after the pandemic helped to accelerate
the move from analogue to digital learning.
The positive outlook will give a lift to new boss Andy
Bird, the former Disney executive who wants Pearson to build
digital ties with school pupils, college students and workers
wanting to retrain and re-skill through their career.
It also comes despite the continued drag from the pandemic
restrictions, which have forced the closure of schools, the
cancellation of exams and a halt to international travel which
affects demand for English-language visa tests.
"It's a steady, positive performance across the board and
we're very pleased with where we've landed, especially given the
circumstances," finance director Sally Johnson told Reuters,
adding that it was too soon to review the full-year outlook.
Bird said the group was "building pace and momentum".
The standout performance came from its Global Online
Learning division, which produced a sales rise of 25% as people
around the world enrolled at virtual schools.
Analysts welcomed the improvement after Pearson endured
years of tumultuous trading as students in the United States
moved to rent or download textbooks, hitting its profits.
Pearson said in the United States it had increased the
amount of product sold into colleges as digital sales rose,
helping to eradicate a secondary-market for textbooks that had
eaten into its income.
Analysts noted however that the first quarter was a
traditionally smaller quarter and the group retained its annual
forecast for adjusted operating profit of 377 million pounds
($525 million), up 20%.
"Pearson's 1Q trading update will make for uncomfortable
reading for bears," said Citi analysts in a note, who rate the
company as a "buy".
($1 = 0.7181 pounds)
(Reporting by Kate Holton, Editing by Paul Sandle, Sarah Young
and Jane Merriman)
Pearson (PSON)
