Pearson : Earnings Document

Pearson 2022

Nine Month

Trading Update

24th October 2022

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Forward-looking statements

Except for the historical information contained herein, the matters discussed in this statement include forward-looking statements. In particular, all statements that express forecasts, expectations and projections with respect to future matters, including trends in results of operations, margins, growth rates, overall market trends, the impact of interest or exchange rates, the availability of financing, anticipated costs savings and synergies and the execution of Pearson's strategy, are forward- looking statements. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that will occur in future. They are based on numerous assumptions regarding Pearson's present and future business strategies and the environment in which it will operate in the future.

There are a number of factors which could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements, including a number of factors outside Pearson's control. These include international, national and local conditions, as well as competition.

They also include other risks detailed from time to time in Pearson's publicly-filed documents and you are advised to read, in particular, the risk factors set out in Pearson's latest annual report and accounts, which can be found on its website

(pearsonplc.com).

Any forward-looking statements speak only as of the date they are made, and Pearson gives no undertaking to update forward- looking statements to reflect any changes in its expectations with regard thereto or any changes to events, conditions or circumstances on which any such statement is based. Readers are cautioned not to place undue reliance on such forward- looking statements.

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Highlights

Strong nine month financial performance, full year expectations reaffirmed

Delivering strategic progress by reshaping our portfolio and increasing interconnectivity

On track to deliver at least £100m of efficiencies in 2023

Strength of performance broad-based across our divisions

Confident of being able to navigate the challenging macroeconomic environment

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Strong financial performance

• Strong trading performance with an outstanding result in English Language Learning. Group underlying sales up 7%
• Disposals of our international courseware local publishing businesses in Europe, French-speaking Canada and Hong Kong now complete
• Full year sales and adjusted operating profit expectations reaffirmed

Assessment &		Virtual Learning		Higher Education
Qualifications		revenue		revenue
revenue
12%		5%		(4)%

English Language		Workforce Skills		Group revenue
Learning revenue		revenue
28%		9%		7%

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2022 Group expectations reaffirmed

Group outlook

• 2022 consensus on the website at full year 2021; median adjusted operating profit of £416m @ £:$ 1.37
• Every 1c movement in £:$ rate equates to approximately £3m adjusted operating profit
• Therefore, an indicative forecast average £:$ rate of 1.27 would add approximately £30m to adjusted operating profit
• Disposals of international local courseware publishing businesses reduces 2022 adjusted operating profit by c.£15m

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