Interim results for the six months to 30thJune 2022 (Unaudited)
|
1 August 2022Strong financial performance and continued momentum; Full year expectations reaffirmed
|
£m
|
H1 2022
|
H1 2021
|
Headline growth
|
CER
growth**
|
Underlying growth
|
Business performance
| |||||
Sales
|
1,788
|
1,597
|
12%
|
6%
|
6%
|
Adjusted operating profit
|
160
|
127
|
26%
|
19%
|
22%
|
Operating cash flow
|
9
|
10
| |||
Adjusted earnings per share
|
22.5p
|
10.5p
| |||
Statutory results
| |||||
Sales
|
1,788
|
1,597
| |||
Operating profit
|
148
|
9
| |||
Net cash generated from operations
|
53
|
79
| |||
Basic earnings per share
|
17.5p
|
2.3p
| |||
Dividend per share
|
6.6p
|
6.3p
| |||
Net debt
|
(810)
|
(646)
|
Contacts
| |||
Investor Relations
|
Jo Russell
James Caddy
|
+44 (0) 7785 451 266
+44 (0) 7825 948 218
| |
Media
|
Tom Steiner
Gemma Terry
|
+44 (0) 7787 415 891
+44 (0) 7841 363 216
| |
Teneo
|
Charles Armitstead
|
+44 (0) 7703 330 269
| |
Virtual event
|
Pearson's interim results online presentation today at 0900 (BST). Register to receive log in details: https://pearson.connectid.cloud/register | ||
KPI
|
Objective
|
KPI Measure
|
H1 2022
|
H1 2021
|
Digital growth
|
Drive digital revenue growth
|
OPM student enrolments
|
143k
|
144k
|
OnVUE volumes
|
1.4m
|
1.6m
| ||
Higher Education US digital registrations
|
4.8m
|
5.3m
| ||
PTE volume
|
344k
|
189k
| ||
Consumer
Engagement
|
Create engaging and personalised
consumer
experiences
|
NPS for Connections Academy
|
+67
|
+62
|
NPS for PTE
|
+51
|
+56
| ||
Pearson+ registered users*
|
4.5m
|
n/a
| ||
Workforce Skills registered users**
|
4.1m
|
n/a
| ||
Product
Effectiveness
|
Improve the effectiveness of our products to deliver better outcomes
|
PTE speed of score return
|
1.3 days
|
1.2 days
|
VUE*** test volumes
|
10.0m
|
8.5m
| ||
Higher Education product usage - text units
|
2.1m
|
2.2m
| ||
Workforce Skills number of enterprise customers****
|
1,387
|
518
|
£ millions
|
H1 2022
|
H1 2021
|
Headline
growth
|
CER
growth*
|
Underlying
growth
|
Sales
| |||||
Assessment & Qualifications
|
697
|
573
|
22%
|
16%
|
16%
|
Virtual Learning
|
390
|
353
|
10%
|
3%
|
3%
|
English Language Learning
|
122
|
94
|
30%
|
26%
|
22%
|
Workforce Skills
|
127
|
112
|
13%
|
13%
|
6%
|
Higher Education
|
373
|
365
|
2%
|
(4)%
|
(4)%
|
Strategic review
|
79
|
100
|
(21)%
|
(21)%
|
(13)%
|
Total
|
1,788
|
1,597
|
12%
|
6%
|
6%
|
Adjusted operating profit/(loss)
| |||||
Assessment & Qualifications
|
137
|
96
|
43%
|
34%
|
34%
|
Virtual Learning
|
14
|
14
|
0%
|
(21)%
|
(21)%
|
English Language Learning
|
(4)
|
(13)
|
69%
|
69%
|
62%
|
Workforce Skills
|
28
|
34
|
(18)%
|
(15)%
|
(6)%
|
Higher Education
|
(4)
|
4
|
(>100%)
|
(>100%)
|
(>100%)
|
Strategic review
|
(11)
|
(8)
|
(38)%
|
(25)%
|
0%
|
Total adjusted operating profit/(loss)
|
160
|
127
|
26%
|
19%
|
22%
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Operating profit
|
148
|
9
|
183
| |
Add back: Cost of major restructuring
|
-
|
85
|
214
| |
Add back: Intangible charges
|
26
|
27
|
51
| |
Add back: Other net gains and losses
|
(14)
|
6
|
(63)
| |
Adjusted operating profit
|
160
|
127
|
385
|
all figures in £ millions
|
note
|
2022
|
2021
|
2021
|
half year
|
half year
|
full year
| ||
Continuing operations
| ||||
Sales
|
2
|
1,788
|
1,597
|
3,428
|
Cost of goods sold
|
(963)
|
(838)
|
(1,747)
| |
Gross profit
|
825
|
759
|
1,681
| |
Operating expenses
|
(690)
|
(744)
|
(1,562)
| |
Other net gains and losses
|
2
|
14
|
(6)
|
63
|
Share of results of joint ventures and associates
|
(1)
|
-
|
1
| |
Operating profit
|
2
|
148
|
9
|
183
|
Finance costs
|
3
|
(8)
|
(31)
|
(68)
|
Finance income
|
3
|
39
|
26
|
42
|
Profit before tax
|
4
|
179
|
4
|
157
|
Income tax
|
5
|
(48)
|
14
|
3
|
Profit for the period
|
131
|
18
|
160
| |
Attributable to:
| ||||
Equity holders of the company
|
131
|
17
|
159
| |
Non-controlling interest
|
-
|
1
|
1
| |
Earnings per share from continuing operations (in pence per share)
| ||||
Basic
|
6
|
17.5p
|
2.3p
|
21.1p
|
Diluted
|
6
|
17.4p
|
2.2p
|
20.9p
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Profit for the period
|
131
|
18
|
160
| |
Items that may be reclassified to the income statement
| ||||
Net exchange differences on translation of foreign operations
|
334
|
(41)
|
(6)
| |
Currency translation adjustment on disposals
|
(7)
|
4
|
4
| |
Attributable tax
|
-
|
-
|
10
| |
Items that are not reclassified to the income statement
| ||||
Fair value gain on other financial assets
|
25
|
22
|
24
| |
Attributable tax
|
(1)
|
(5)
|
(3)
| |
Remeasurement of retirement benefit obligations
|
121
|
33
|
149
| |
Attributable tax
|
(30)
|
(36)
|
(61)
| |
Other comprehensive income / (expense)
|
442
|
(23)
|
117
| |
Total comprehensive income / (expense)
|
573
|
(5)
|
277
| |
Attributable to:
| ||||
Equity holders of the company
|
572
|
(6)
|
276
| |
Non-controlling interest
|
1
|
1
|
1
|
all figures in £ millions
|
note
|
2022
|
2021
|
2021
|
half year
|
half year
|
full year
| ||
Property, plant and equipment
|
292
|
453
|
366
| |
Investment property
|
72
|
-
|
-
| |
Intangible assets
|
10
|
3,214
|
2,686
|
2,769
|
Investments in joint ventures and associates
|
24
|
12
|
24
| |
Deferred income tax assets
|
41
|
45
|
57
| |
Financial assets - derivative financial instruments
|
33
|
34
|
30
| |
Net retirement benefit assets
|
652
|
437
|
537
| |
Other financial assets
|
120
|
160
|
113
| |
Income tax assets
|
41
|
-
|
97
| |
Trade and other receivables
|
143
|
137
|
129
| |
Non-current assets
|
4,632
|
3,964
|
4,122
| |
Intangible assets - pre-publication
|
932
|
875
|
894
| |
Inventories
|
103
|
126
|
98
| |
Trade and other receivables
|
1,207
|
1,147
|
1,257
| |
Financial assets - derivative financial instruments
|
1
|
5
|
2
| |
Current income tax assets
|
2
|
134
|
26
| |
Cash and cash equivalents (excluding overdrafts)
|
392
|
648
|
937
| |
Current assets
|
2,637
|
2,935
|
3,214
| |
Assets classified as held for sale
|
13
|
201
|
18
|
7
|
Total assets
|
7,470
|
6,917
|
7,343
| |
Financial liabilities - borrowings
|
(1,151)
|
(1,259)
|
(1,245)
| |
Financial liabilities - derivative financial instruments
|
(44)
|
(31)
|
(30)
| |
Deferred income tax liabilities
|
(96)
|
(103)
|
(40)
| |
Net retirement benefit obligations
|
(61)
|
(79)
|
(66)
| |
Provisions for other liabilities and charges
|
(9)
|
(8)
|
(7)
| |
Other liabilities
|
(123)
|
(61)
|
(95)
| |
Non-current liabilities
|
(1,484)
|
(1,541)
|
(1,483)
| |
Trade and other liabilities
|
(1,234)
|
(1,049)
|
(1,256)
| |
Financial liabilities - borrowings
|
(150)
|
(156)
|
(155)
| |
Financial liabilities - derivative financial instruments
|
(10)
|
(8)
|
(4)
| |
Current income tax liabilities
|
(30)
|
(95)
|
(125)
| |
Provisions for other liabilities and charges
|
(28)
|
(26)
|
(40)
| |
Current liabilities
|
(1,452)
|
(1,334)
|
(1,580)
| |
Liabilities classified as held for sale
|
13
|
(42)
|
(3)
|
-
|
Total liabilities
|
(2,978)
|
(2,878)
|
(3,063)
| |
Net assets
|
4,492
|
4,039
|
4,280
| |
Share capital
|
185
|
189
|
189
| |
Share premium
|
2,628
|
2,622
|
2,626
| |
Treasury shares
|
(22)
|
(7)
|
(12)
| |
Reserves
|
1,690
|
1,225
|
1,467
| |
Total equity attributable to equity holders of the company
|
4,481
|
4,029
|
4,270
| |
Non-controlling interest
|
11
|
10
|
10
| |
Total equity
|
4,492
|
4,039
|
4,280
|
Equity attributable to equity holders of the company
| ||||||||||
all figures in £ millions
|
Share capital
|
Share premium
|
Treasury shares
|
Capital redemption reserve
|
Fair value reserve
|
Translation reserve
|
Retained earnings
|
Total
|
Non-controlling interest
|
Total equity
|
2022 half year
| ||||||||||
At 1 January 2022
|
189
|
2,626
|
(12)
|
18
|
33
|
386
|
1,030
|
4,270
|
10
|
4,280
|
Profit for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
131
|
131
|
-
|
131
|
Other comprehensive income
|
-
|
-
|
-
|
-
|
25
|
326
|
90
|
441
|
1
|
442
|
Total comprehensive income
|
-
|
-
|
-
|
-
|
25
|
326
|
221
|
572
|
1
|
573
|
Equity-settled transactions
|
-
|
-
|
-
|
-
|
-
|
-
|
18
|
18
|
-
|
18
|
Issue of ordinary shares
|
-
|
2
|
-
|
-
|
-
|
-
|
-
|
2
|
-
|
2
|
Buyback of equity
|
(4)
|
-
|
-
|
4
|
-
|
-
|
(250)
|
(250)
|
-
|
(250)
|
Purchase of treasury shares
|
-
|
-
|
(24)
|
-
|
-
|
-
|
-
|
(24)
|
-
|
(24)
|
Release of treasury shares
|
-
|
-
|
14
|
-
|
-
|
-
|
(14)
|
-
|
-
|
-
|
Transfer of gain on disposal of FVOCI investment
|
-
|
-
|
-
|
-
|
(27)
|
-
|
27
|
-
|
-
|
-
|
Dividends
|
-
|
-
|
-
|
-
|
-
|
-
|
(107)
|
(107)
|
-
|
(107)
|
At 30 June 2022
|
185
|
2,628
|
(22)
|
22
|
31
|
712
|
925
|
4,481
|
11
|
4,492
|
Equity attributable to equity holders of the company
| ||||||||||
all figures in £ millions
|
Share capital
|
Share premium
|
Treasury shares
|
Capital redemption reserve
|
Fair value reserve
|
Translation reserve
|
Retained earnings
|
Total
|
Non-controlling interest
|
Total equity
|
2021 half year
| ||||||||||
At 1 January 2021
|
188
|
2,620
|
(7)
|
18
|
53
|
388
|
865
|
4,125
|
9
|
4,134
|
Profit for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
17
|
17
|
1
|
18
|
Other comprehensive income / (expense)
|
-
|
-
|
-
|
-
|
22
|
(37)
|
(8)
|
(23)
|
-
|
(23)
|
Total comprehensive income / (expense)
|
-
|
-
|
-
|
-
|
22
|
(37)
|
9
|
(6)
|
1
|
(5)
|
Equity-settled transactions
|
-
|
-
|
-
|
-
|
-
|
-
|
16
|
16
|
-
|
16
|
Issue of ordinary shares
|
1
|
2
|
(1)
|
-
|
-
|
-
|
-
|
2
|
-
|
2
|
Buyback of equity
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Purchase of treasury shares
|
-
|
-
|
(6)
|
-
|
-
|
-
|
-
|
(6)
|
-
|
(6)
|
Release of treasury shares
|
-
|
-
|
7
|
-
|
-
|
-
|
(7)
|
-
|
-
|
-
|
Dividends
|
-
|
-
|
-
|
-
|
-
|
-
|
(102)
|
(102)
|
-
|
(102)
|
At 30 June 2021
|
189
|
2,622
|
(7)
|
18
|
75
|
351
|
781
|
4,029
|
10
|
4,039
|
Equity attributable to equity holders of the company
| ||||||||||
all figures in £ millions
|
Share capital
|
Share premium
|
Treasury shares
|
Capital redemption reserve
|
Fair value reserve
|
Translation reserve
|
Retained earnings
|
Total
|
Non-controlling interest
|
Total equity
|
2021 full year
| ||||||||||
At 1 January 2021
|
188
|
2,620
|
(7)
|
18
|
53
|
388
|
865
|
4,125
|
9
|
4,134
|
Profit for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
159
|
159
|
1
|
160
|
Other comprehensive income / (expense)
|
-
|
-
|
-
|
-
|
24
|
(2)
|
95
|
117
|
-
|
117
|
Total comprehensive income / (expense)
|
-
|
-
|
-
|
-
|
24
|
(2)
|
254
|
276
|
1
|
277
|
Equity-settled transactions
|
-
|
-
|
-
|
-
|
-
|
-
|
28
|
28
|
-
|
28
|
Issue of ordinary shares
|
1
|
6
|
(1)
|
-
|
-
|
-
|
-
|
6
|
-
|
6
|
Buyback of equity
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Purchase of treasury shares
|
-
|
-
|
(16)
|
-
|
-
|
-
|
-
|
(16)
|
-
|
(16)
|
Release of treasury shares
|
-
|
-
|
12
|
-
|
-
|
-
|
(12)
|
-
|
-
|
-
|
Transfer of gain on disposal of FVOCI investment
|
-
|
-
|
-
|
-
|
(44)
|
-
|
44
|
-
|
-
|
-
|
Dividends
|
-
|
-
|
-
|
-
|
-
|
-
|
(149)
|
(149)
|
-
|
(149)
|
At 31 December 2021
|
189
|
2,626
|
(12)
|
18
|
33
|
386
|
1,030
|
4,270
|
10
|
4,280
|
all figures in £ millions
|
note
|
2022
|
2021
|
2021
|
half year
|
half year
|
full year
| ||
Cash flows from operating activities
| ||||
Profit before tax
|
179
|
4
|
157
| |
Net finance costs
|
(31)
|
5
|
26
| |
Depreciation and impairment - PPE & investment property
|
42
|
104
|
241
| |
Amortisation and impairment - software
|
60
|
56
|
117
| |
Amortisation and impairment - acquired intangible assets
|
26
|
27
|
50
| |
Other net gains and losses
|
(14)
|
6
|
(63)
| |
Product development capital expenditure
|
(151)
|
(151)
|
(287)
| |
Product development amortisation
|
136
|
143
|
279
| |
Share-based payment costs
|
18
|
16
|
28
| |
Inventories
|
(34)
|
(4)
|
22
| |
Trade and other receivables
|
14
|
18
|
(71)
| |
Trade and other liabilities
|
(197)
|
(156)
|
37
| |
Other movements
|
5
|
11
|
34
| |
Net cash generated from operations
|
53
|
79
|
570
| |
Interest paid
|
(35)
|
(33)
|
(67)
| |
Tax paid
|
(51)
|
(121)
|
(177)
| |
Net cash (used in) / generated from operating activities
|
(33)
|
(75)
|
326
| |
Cash flows from investing activities
| ||||
Acquisition of subsidiaries, net of cash acquired
|
11
|
(221)
|
(6)
|
(55)
|
Acquisition of joint ventures and associates
|
(4)
|
(5)
|
(10)
| |
Purchase of investments
|
(4)
|
(1)
|
(4)
| |
Purchase of property, plant and equipment
|
(21)
|
(31)
|
(64)
| |
Purchase of intangible assets
|
(46)
|
(39)
|
(112)
| |
Disposal of subsidiaries, net of cash disposed
|
12
|
108
|
(7)
|
83
|
Proceeds from sale of investments
|
-
|
-
|
48
| |
Proceeds from sale of property, plant and equipment
|
14
|
-
|
-
| |
Lease receivables repaid including disposals
|
9
|
6
|
21
| |
Interest received
|
11
|
3
|
13
| |
Dividends received from joint ventures and associates
|
2
|
-
|
-
| |
Net cash used in investing activities
|
(152)
|
(80)
|
(80)
| |
Cash flows from financing activities
| ||||
Proceeds from issue of ordinary shares
|
2
|
2
|
6
| |
Buyback of equity
|
(141)
|
-
|
-
| |
Purchase of treasury shares
|
(24)
|
(6)
|
(16)
| |
Repayment of borrowings
|
(95)
|
(167)
|
(167)
| |
Repayment of lease liabilities
|
(48)
|
(36)
|
(88)
| |
Dividends paid to company's shareholders
|
(107)
|
(102)
|
(149)
| |
Net cash used in financing activities
|
(413)
|
(309)
|
(414)
| |
Effects of exchange rate changes on cash and cash equivalents
|
53
|
(1)
|
(8)
| |
Net decrease in cash and cash equivalents
|
(545)
|
(465)
|
(176)
| |
Cash and cash equivalents at beginning of period
|
937
|
1,113
|
1,113
| |
Cash and cash equivalents at end of period
|
392
|
648
|
937
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Sales
| ||||
Assessment & Qualifications
|
697
|
573
|
1,204
| |
Virtual Learning
|
390
|
353
|
713
| |
English Language Learning
|
122
|
94
|
238
| |
Workforce Skills
|
127
|
112
|
172
| |
Higher Education
|
373
|
365
|
849
| |
Strategic Review
|
79
|
100
|
252
| |
Total sales
|
1,788
|
1,597
|
3,428
| |
Adjusted operating profit
| ||||
Assessment & Qualifications
|
137
|
96
|
216
| |
Virtual Learning
|
14
|
14
|
32
| |
English Language Learning
|
(4)
|
(13)
|
15
| |
Workforce Skills
|
28
|
34
|
27
| |
Higher Education
|
(4)
|
4
|
73
| |
Strategic Review
|
(11)
|
(8)
|
22
| |
Total adjusted operating profit
|
160
|
127
|
385
|
all figures in £ millions
|
Assessment & Qualifications
|
Virtual Learning
|
English Language Learning
|
Workforce Skills
|
Higher Education
|
Strategic Review
|
Total
|
2022 half year
| |||||||
Courseware
| |||||||
Products transferred at a point in time
|
20
|
-
|
41
|
1
|
92
|
67
|
221
|
Products and services transferred over time
|
8
|
-
|
8
|
-
|
278
|
9
|
303
|
28
|
-
|
49
|
1
|
370
|
76
|
524
| |
Assessments
| |||||||
Products transferred at a point in time
|
80
|
-
|
4
|
10
|
-
|
-
|
94
|
Products and services transferred over time
|
589
|
-
|
55
|
94
|
-
|
-
|
738
|
669
|
-
|
59
|
104
|
-
|
-
|
832
| |
Services
| |||||||
Products transferred at a point in time
|
-
|
-
|
10
|
-
|
-
|
-
|
10
|
Products and services transferred over time
|
-
|
390
|
4
|
22
|
3
|
3
|
422
|
-
|
390
|
14
|
22
|
3
|
3
|
432
| |
Total sales
|
697
|
390
|
122
|
127
|
373
|
79
|
1,788
|
2021 half year
| |||||||
Courseware
| |||||||
Products transferred at a point in time
|
20
|
-
|
43
|
-
|
84
|
72
|
219
|
Products and services transferred over time
|
6
|
-
|
8
|
-
|
277
|
15
|
306
|
26
|
-
|
51
|
-
|
361
|
87
|
525
| |
Assessments
| |||||||
Products transferred at a point in time
|
73
|
-
|
2
|
9
|
-
|
-
|
84
|
Products and services transferred over time
|
474
|
-
|
33
|
84
|
-
|
-
|
591
|
547
|
-
|
35
|
93
|
-
|
-
|
675
| |
Services
|
-
| ||||||
Products transferred at a point in time
|
-
|
-
|
8
|
-
|
-
|
11
|
19
|
Products and services transferred over time
|
-
|
353
|
-
|
19
|
4
|
2
|
378
|
-
|
353
|
8
|
19
|
4
|
13
|
397
| |
Total sales
|
573
|
353
|
94
|
112
|
365
|
100
|
1,597
|
all figures in £ millions
|
Assessment & Qualifications
|
Virtual Learning
|
English Language Learning
|
Workforce Skills
|
Higher Education
|
Strategic Review
|
Total
|
2021 full year
| |||||||
Courseware
| |||||||
Products transferred at a point in time
|
44
|
-
|
109
|
-
|
283
|
198
|
634
|
Products and services transferred over time
|
14
|
-
|
26
|
-
|
558
|
33
|
631
|
58
|
-
|
135
|
-
|
841
|
231
|
1,265
| |
Assessments
| |||||||
Products transferred at a point in time
|
173
|
-
|
6
|
16
|
-
|
-
|
195
|
Products and services transferred over time
|
973
|
-
|
72
|
119
|
-
|
-
|
1,164
|
1,146
|
-
|
78
|
135
|
-
|
-
|
1,359
| |
Services
| |||||||
Products transferred at a point in time
|
-
|
-
|
22
|
-
|
-
|
14
|
36
|
Products and services transferred over time
|
-
|
713
|
3
|
37
|
8
|
7
|
768
|
-
|
713
|
25
|
37
|
8
|
21
|
804
| |
Total sales
|
1,204
|
713
|
238
|
172
|
849
|
252
|
3,428
|
all figures in £ millions
|
Assessment & Qualifications
|
Virtual Learning
|
English Language Learning
|
Workforce Skills
|
Higher Education
|
Strategic Review
|
Total
|
2022 half year
| |||||||
Adjusted operating profit / (loss)
|
137
|
14
|
(4)
|
28
|
(4)
|
(11)
|
160
|
Cost of major restructuring
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Intangible charges
|
(7)
|
(10)
|
(2)
|
(5)
|
(2)
|
-
|
(26)
|
Other net gains and losses
|
-
|
-
|
(3)
|
4
|
-
|
13
|
14
|
Operating profit / (loss)
|
130
|
4
|
(9)
|
27
|
(6)
|
2
|
148
|
2021 half year
| |||||||
Adjusted operating profit / (loss)
|
96
|
14
|
(13)
|
34
|
4
|
(8)
|
127
|
Cost of major restructuring
|
(24)
|
(15)
|
(11)
|
(13)
|
(22)
|
-
|
(85)
|
Intangible charges
|
(7)
|
(12)
|
(3)
|
(4)
|
(1)
|
-
|
(27)
|
Other net gains and losses
|
-
|
-
|
-
|
-
|
-
|
(6)
|
(6)
|
Operating profit / (loss)
|
65
|
(13)
|
(27)
|
17
|
(19)
|
(14)
|
9
|
2021 full year
| |||||||
Adjusted operating profit / (loss)
|
216
|
32
|
15
|
27
|
73
|
22
|
385
|
Cost of major restructuring
|
(48)
|
(48)
|
(27)
|
(28)
|
(63)
|
-
|
(214)
|
Intangible charges
|
(13)
|
(25)
|
(3)
|
(7)
|
(2)
|
(1)
|
(51)
|
Other net gains and losses
|
-
|
-
|
-
|
(2)
|
-
|
65
|
63
|
Operating profit / (loss)
|
155
|
(41)
|
(15)
|
(10)
|
8
|
86
|
183
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Net interest receivable / (payable)
|
18
|
(27)
|
(57)
| |
Net finance income in respect of retirement benefits
|
4
|
2
|
4
| |
Fair value re-measurement of disposal proceeds
|
-
|
5
|
6
| |
Interest on deferred and contingent consideration
|
(1)
|
-
|
-
| |
Net foreign exchange gains
|
1
|
1
|
1
| |
Derivatives not in a hedge relationship
|
14
|
14
|
20
| |
Interest on tax provisions
|
(5)
|
-
|
-
| |
Net finance income / (costs)
|
31
|
(5)
|
(26)
| |
Analysed as:
| ||||
Finance costs
|
(8)
|
(31)
|
(68)
| |
Finance income
|
39
|
26
|
42
| |
Net finance income / (costs)
|
31
|
(5)
|
(26)
| |
Analysed as:
| ||||
Net interest receivable / (payable) reflected in adjusted earnings
|
18
|
(27)
|
(57)
| |
Other net finance income
|
13
|
22
|
31
| |
Net finance income / (costs)
|
31
|
(5)
|
(26)
|
all figures in £ millions
|
note
|
2022
|
2021
|
2021
|
half year
|
half year
|
full year
| ||
Profit before tax
|
179
|
4
|
157
| |
Cost of major restructuring
|
2
|
-
|
85
|
214
|
Other net gains and losses
|
2
|
(14)
|
6
|
(63)
|
Intangible charges
|
2
|
26
|
27
|
51
|
Other net finance income
|
3
|
(13)
|
(22)
|
(31)
|
Adjusted profit before tax
|
178
|
100
|
328
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Income tax (charge) / benefit
|
(48)
|
14
|
3
| |
Tax benefit on cost of major restructuring
|
-
|
(21)
|
(47)
| |
Tax charge / (benefit) on other net gains and losses
|
34
|
(10)
|
14
| |
Tax benefit on intangible charges
|
(6)
|
(12)
|
(12)
| |
Tax charge on other net finance income
|
3
|
5
|
6
| |
Tax amortisation benefit on goodwill and intangibles
|
7
|
4
|
8
| |
Benefit from change in tax accounting treatment
|
-
|
-
|
(11)
| |
Tax charge / (benefit) on UK tax rate change
|
1
|
-
|
(25)
| |
Adjusted income tax charge
|
(9)
|
(20)
|
(64)
| |
Tax rate reflected in statutory earnings
|
26.8%
|
(350.0)%
|
(1.8)%
| |
Tax rate reflected in adjusted earnings
|
5.1%
|
20.0 %
|
19.5%
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Earnings for the period
|
131
|
18
|
160
| |
Non-controlling interest
|
-
|
(1)
|
(1)
| |
Earnings attributable to equity shareholders
|
131
|
17
|
159
| |
Weighted average number of shares (millions)
|
750.3
|
753.2
|
754.1
| |
Effect of dilutive share options (millions)
|
2.6
|
3.4
|
5.0
| |
Weighted average number of shares (millions) for diluted earnings
|
752.9
|
756.6
|
759.1
| |
Earnings per share
| ||||
Basic
|
17.5p
|
2.3p
|
21.1p
| |
Diluted
|
17.4p
|
2.2p
|
20.9p
|
all figures in £ millions
|
note
|
Statutory income statement
|
Cost of major restructuring
|
Other net gains and losses
|
Intangible charges
|
Other net finance costs
|
Tax amortisation benefit
|
Change in UK tax rate
|
Benefit from change in tax accounting treatment
|
Adjusted income statement
|
2022 half year
| ||||||||||
Operating profit / (loss)
|
2
|
148
|
-
|
(14)
|
26
|
-
|
-
|
-
|
-
|
160
|
Net finance income / (costs)
|
3
|
31
|
-
|
-
|
-
|
(13)
|
-
|
-
|
-
|
18
|
Profit / (loss) before tax
|
4
|
179
|
-
|
(14)
|
26
|
(13)
|
-
|
-
|
-
|
178
|
Income tax
|
5
|
(48)
|
-
|
34
|
(6)
|
3
|
7
|
1
|
-
|
(9)
|
Profit / (loss) for the year
|
131
|
-
|
20
|
20
|
(10)
|
7
|
1
|
-
|
169
| |
Non-controlling interest
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
| |
Earnings / (loss)
|
131
|
-
|
20
|
20
|
(10)
|
7
|
1
|
-
|
169
| |
Weighted average number of shares (millions)
|
750.3
| |||||||||
Weighted average number of shares (millions) for diluted earnings
|
752.9
| |||||||||
Adjusted earnings per share (basic)
|
22.5p
| |||||||||
Adjusted earnings per share (diluted)
|
22.4p
|
all figures in £ millions
|
note
|
Statutory income statement
|
Cost of major restructuring
|
Other net gains and losses
|
Intangible charges
|
Other net finance costs
|
Tax amortisation benefit
|
Change in UK tax rate
|
Benefit from change in tax accounting treatment
|
Adjusted income statement
|
2021 half year
| ||||||||||
Operating profit
|
2
|
9
|
85
|
6
|
27
|
-
|
-
|
-
|
-
|
127
|
Net finance costs
|
4
|
(5)
|
-
|
-
|
-
|
(22)
|
-
|
-
|
-
|
(27)
|
Profit / (loss) before tax
|
5
|
4
|
85
|
6
|
27
|
(22)
|
-
|
-
|
-
|
100
|
Income tax
|
6
|
14
|
(21)
|
(10)
|
(12)
|
5
|
4
|
-
|
-
|
(20)
|
Profit / (loss) for the year
|
18
|
64
|
(4)
|
15
|
(17)
|
4
|
-
|
-
|
80
| |
Non-controlling interest
|
(1)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(1)
| |
Earnings / (loss)
|
17
|
64
|
(4)
|
15
|
(17)
|
4
|
-
|
-
|
79
| |
Weighted average number of shares (millions)
|
753.2
| |||||||||
Weighted average number of shares (millions) for diluted earnings
|
756.6
| |||||||||
Adjusted earnings per share (basic)
|
10.5p
| |||||||||
Adjusted earnings per share (diluted)
|
10.4p
|
all figures in £ millions
|
note
|
Statutory income statement
|
Cost of major restructuring
|
Other net gains and losses
|
Intangible charges
|
Other net finance costs
|
Tax amortisation benefit
|
Change in UK tax rate
|
Benefit from change in tax accounting treatment
|
Adjusted income statement
|
2021 full year
| ||||||||||
Operating profit / (loss)
|
2
|
183
|
214
|
(63)
|
51
|
-
|
-
|
-
|
-
|
385
|
Net finance costs
|
4
|
(26)
|
-
|
-
|
-
|
(31)
|
-
|
-
|
-
|
(57)
|
Profit / (loss) before tax
|
5
|
157
|
214
|
(63)
|
51
|
(31)
|
-
|
-
|
-
|
328
|
Income tax
|
6
|
3
|
(47)
|
14
|
(12)
|
6
|
8
|
(25)
|
(11)
|
(64)
|
Profit / (loss) for the year
|
160
|
167
|
(49)
|
39
|
(25)
|
8
|
(25)
|
(11)
|
264
| |
Non-controlling interest
|
(1)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(1)
| |
Earnings / (loss)
|
159
|
167
|
(49)
|
39
|
(25)
|
8
|
(25)
|
(11)
|
263
| |
Weighted average number of shares (millions)
|
754.1
| |||||||||
Weighted average number of shares (millions) for diluted earnings
|
759.1
| |||||||||
Adjusted earnings per share (basic)
|
34.9p
| |||||||||
Adjusted earnings per share (diluted)
|
34.6p
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Amounts recognised as distributions to equity shareholders in the period
|
107
|
102
|
149
|
2022
|
2021
|
2021
| ||
half year
|
half year
|
full year
| ||
Average rate for profits
|
1.30
|
1.39
|
1.38
| |
Period end rate
|
1.21
|
1.38
|
1.35
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Goodwill
|
2,470
|
2,073
|
2,145
| |
Other intangibles
|
744
|
613
|
624
| |
Non-current intangible assets
|
3,214
|
2,686
|
2,769
|
all figures in £ millions
|
2022
|
2022
|
2022
|
2022
|
2021
|
2021
| |
Credly
|
Mondly
|
Other
|
half year
|
half year
|
full year
| ||
Intangible assets
|
49
|
50
|
10
|
109
|
2
|
27
| |
Deferred tax assets
|
7
|
1
|
-
|
8
|
-
|
11
| |
Trade and other receivables
|
6
|
2
|
1
|
9
|
-
|
2
| |
Cash and cash equivalents
|
12
|
1
|
-
|
13
|
-
|
4
| |
Trade and other liabilities
|
(18)
|
(8)
|
-
|
(26)
|
-
|
(5)
| |
Deferred tax liabilities
|
(12)
|
(8)
|
(2)
|
(22)
|
-
|
(6)
| |
Net assets acquired
|
44
|
38
|
9
|
91
|
2
|
33
| |
Goodwill
|
105
|
97
|
2
|
204
|
2
|
43
| |
Total
|
149
|
135
|
11
|
295
|
4
|
76
| |
Satisfied by:
| |||||||
Cash consideration
|
107
|
105
|
11
|
223
|
2
|
54
| |
Deferred and contingent consideration
|
11
|
30
|
-
|
41
|
2
|
16
| |
Fair value of existing investment
|
31
|
-
|
-
|
31
|
-
|
6
| |
Total consideration
|
149
|
135
|
11
|
295
|
4
|
76
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Cash - current year acquisitions
|
(223)
|
(2)
|
(54)
| |
Cash and cash equivalents acquired
|
13
|
-
|
4
| |
Deferred payments for prior year acquisitions
|
(7)
|
(4)
|
(4)
| |
Acquisition costs paid
|
(4)
|
-
|
(1)
| |
Net cash outflow on acquisitions
|
(221)
|
(6)
|
(55)
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
notes
|
half year
|
half year
|
full year
| |
Intangible assets
|
(1)
|
-
|
(3)
| |
Property, plant and equipment
|
-
|
(48)
|
(48)
| |
Intangible assets - product development
|
(9)
|
-
|
(6)
| |
Inventories
|
(7)
|
-
|
(2)
| |
Trade and other receivables
|
(5)
|
(2)
|
(6)
| |
Cash and cash equivalents (excluding overdrafts)
|
(3)
|
(21)
|
(24)
| |
Trade and other liabilities
|
6
|
1
|
4
| |
Provisions for other liabilities and charges
|
-
|
3
|
3
| |
Financial liabilities - borrowings
|
-
|
67
|
67
| |
Net assets disposed
|
(19)
|
-
|
(15)
| |
Cumulative translation adjustment
|
7
|
(4)
|
(4)
| |
Cash proceeds
|
38
|
-
|
108
| |
Costs of disposal
|
(13)
|
(2)
|
(24)
| |
Gain / (loss) on disposal
|
13
|
(6)
|
65
| |
Cash flow from disposals
| ||||
Proceeds - current year disposals
|
38
|
-
|
108
| |
Proceeds - prior year disposals
|
15
|
87
|
16
|
16
|
Cash and cash equivalents disposed
|
(3)
|
(21)
|
(24)
| |
Costs and other disposal liabilities paid
|
(14)
|
(2)
|
(17)
| |
Net cash inflow / (outflow) from disposals
|
108
|
(7)
|
83
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Property, plant and equipment
|
9
|
-
|
7
| |
Intangible assets
|
75
|
3
|
-
| |
Deferred income tax assets
|
14
|
1
|
-
| |
Intangible assets - pre-publication
|
26
|
6
|
-
| |
Inventories
|
28
|
3
|
-
| |
Trade and other receivables
|
49
|
5
|
-
| |
Provisions for liabilities and charges
|
(2)
|
-
|
-
| |
Trade and other liabilities
|
(33)
|
(3)
|
-
| |
Financial liabilities - borrowings
|
(7)
|
-
|
-
| |
Net assets classified as held for sale
|
159
|
15
|
7
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
Non-current assets
| ||||
Derivative financial instruments
|
33
|
34
|
30
| |
Trade and other receivables - investment in finance lease
|
109
|
105
|
100
| |
Current assets
| ||||
Derivative financial instruments
|
1
|
5
|
2
| |
Trade and other receivables - investment in finance lease
|
17
|
16
|
15
| |
Cash and cash equivalents (excluding overdrafts)
|
392
|
648
|
937
| |
Non-current liabilities
| ||||
Borrowings
|
(1,158)
|
(1,259)
|
(1,245)
| |
Derivative financial instruments
|
(44)
|
(31)
|
(30)
| |
Current liabilities
| ||||
Borrowings
|
(150)
|
(156)
|
(155)
| |
Derivative financial instruments
|
(10)
|
(8)
|
(4)
| |
Net debt
|
(810)
|
(646)
|
(350)
|
Level 1
|
Level 2
|
---Level 3---
|
Total fair value
| ||
all figures in £ millions
|
FVTPL - Cash and cash equivalents
|
Derivatives
|
FVOCI
Investments
|
FVTPL - Other
| |
2022 half year
| |||||
Investments in unlisted securities
|
-
|
-
|
120
|
-
|
120
|
Other receivables
|
-
|
-
|
-
|
-
|
-
|
Cash and cash equivalents
|
23
|
-
|
-
|
-
|
23
|
Derivative financial instruments
|
-
|
34
|
-
|
-
|
34
|
Total financial assets held at fair value
|
23
|
34
|
120
|
-
|
177
|
Derivative financial instruments
|
-
|
(54)
|
-
|
-
|
(54)
|
Deferred and contingent consideration
|
-
|
-
|
-
|
(79)
|
(79)
|
Total financial liabilities held at fair value
|
-
|
(54)
|
-
|
(79)
|
(133)
|
2021 half year
| |||||
Investments in unlisted securities
|
-
|
-
|
160
|
-
|
160
|
Other receivables
|
-
|
-
|
-
|
84
|
84
|
Cash and cash equivalents
|
75
|
-
|
-
|
-
|
75
|
Derivative financial instruments
|
-
|
39
|
-
|
-
|
39
|
Total financial assets held at fair value
|
75
|
39
|
160
|
84
|
358
|
Derivative financial instruments
|
-
|
(39)
|
-
|
-
|
(39)
|
Deferred and contingent consideration
|
-
|
-
|
-
|
(29)
|
(29)
|
Total financial liabilities held at fair value
|
-
|
(39)
|
-
|
(29)
|
(68)
|
2021 full year
| |||||
Investments in unlisted securities
|
-
|
-
|
113
|
-
|
113
|
Other receivables
|
-
|
-
|
-
|
87
|
87
|
Cash and cash equivalents
|
84
|
-
|
-
|
-
|
84
|
Derivative financial instruments
|
-
|
32
|
-
|
-
|
32
|
Total financial assets held at fair value
|
84
|
32
|
113
|
87
|
316
|
Derivative financial instruments
|
-
|
(34)
|
-
|
-
|
(34)
|
Deferred and contingent consideration
|
-
|
-
|
-
|
(44)
|
(44)
|
Total financial liabilities held at fair value
|
-
|
(34)
|
-
|
(44)
|
(78)
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
At beginning of period
|
200
|
234
|
234
| |
Exchange differences - OCI
|
9
|
(2)
|
2
| |
Additions
|
4
|
1
|
4
| |
Repayments
|
(87)
|
(16)
|
(16)
| |
Disposals
|
(31)
|
-
|
(54)
| |
Fair value movements - Income Statement
|
-
|
5
|
6
| |
Fair value movements - OCI
|
25
|
22
|
24
| |
At end of period
|
120
|
244
|
200
|
all figures in £ millions
|
2022
|
2021
|
2021
| |
half year
|
half year
|
full year
| ||
At beginning of period
|
(44)
|
(30)
|
(30)
| |
Exchange differences
|
(7)
|
(1)
|
(1)
| |
Acquisitions
|
(41)
|
(2)
|
(16)
| |
Fair value movements - Income Statement
|
6
|
-
|
(1)
| |
Repayments
|
7
|
4
|
4
| |
At end of period
|
(79)
|
(29)
|
(44)
|
all figures in £ millions
|
Statutory measure
|
Cost of major restructuring
|
Other net gains and losses
|
Intangible charges
|
Purchase/ disposal of PPE and software
|
Net addition of right of use assets
|
Dividends from joint ventures and associates
|
Adjusted measure
| ||
2022 half year
| ||||||||||
Operating profit
|
148
|
-
|
(14)
|
26
|
-
|
-
|
-
|
160
|
Adjusted operating profit
| |
Net cash generated from operations
|
53
|
13
|
-
|
-
|
(53)
|
(6)
|
2
|
9
|
Operating cash flow
| |
2021 half year
| ||||||||||
Operating profit
|
9
|
85
|
6
|
27
|
-
|
-
|
-
|
127
|
Adjusted operating profit
| |
Net cash generated from operations
|
79
|
10
|
-
|
-
|
(70)
|
(9)
|
-
|
10
|
Operating cash flow
| |
2021 full year
| ||||||||||
Operating profit
|
183
|
214
|
(63)
|
51
|
-
|
-
|
-
|
385
|
Adjusted operating profit
| |
Net cash generated from operations
|
570
|
24
|
-
|
-
|
(176)
|
(30)
|
-
|
388
|
Operating cash flow
|
all figures in £ millions
|
note
|
2022
|
2021
|
2021
|
half year
|
half year
|
full year
| ||
Reconciliation of operating cash flow to closing net debt
| ||||
Operating cash flow
|
9
|
10
|
388
| |
Tax paid
|
(51)
|
(121)
|
(177)
| |
Net finance costs paid
|
(24)
|
(30)
|
(54)
| |
Cost paid for major restructuring
|
(13)
|
(10)
|
(24)
| |
Free cash flow
|
(79)
|
(151)
|
133
| |
Dividends paid (including to non-controlling interest)
|
(107)
|
(102)
|
(149)
| |
Net movement of funds from operations
|
(186)
|
(253)
|
(16)
| |
Acquisitions and disposals
|
(121)
|
(19)
|
62
| |
Disposal of lease liabilities
|
-
|
67
|
67
| |
Net equity transactions
|
(163)
|
(4)
|
(10)
| |
Other movements on financial instruments
|
10
|
26
|
10
| |
Movement in net debt
|
(460)
|
(183)
|
113
| |
Opening net debt
|
(350)
|
(463)
|
(463)
| |
Closing net debt
|
14
|
(810)
|
(646)
|
(350)
|
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Pearson plc published this content on 01 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 August 2022 14:14:05 UTC.