First half revenues fell by 3% at Pearson, partly as a result of continuing weak advertising conditions at its Financial Times newspaper, the group said today.
Reporting a decline in pre-tax profits from £26 million in H1 2002 to a loss of £1 million this time, Pearson said that there were ongoing tough trading conditions in advertising and technology businesses.
Ad revenues at the FT fell by 18% in the half, pretty much as expected, although slightly better than the 20% decline predicted by Merrill Lynch.
Sales at the FT Group as a whole were down by 5% as a result of the ‘deep recession’ in corporate and financial advertising, which has hit all of Pearson’s business publications. However, profits were up 17%, helped by lower internet losses.
The FT.com website was less affected by the poor ad conditions, with revenues remaining flat year on year. The site’s audience has grown from 2.8 million unique users per month last year to 3.5 million currently. The number of paid subscribers is up from 16,000 to 57,000.
Overall operating profits at Pearson fell by 50% to £38 million.
Pearson’s chief executive, Marjorie Scardino, says that she is confident about the full year because the company is now operating at much lower costs and in market-leading positions.
“Our business newspapers, with lower costs and improved content, will bounce back strongly when business advertising recovers,” she added.
Shares in Pearson were up by 2.3% at 582p by 10.15am today.
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