* Pearson raises 2011 EPS guidance to 83p from 80p on lower
* Trading in line with expectations
* Shares flat
By Georgina Prodhan
LONDON, Nov 3 British publishing group Pearson
raised its full-year earnings guidance by 4 percent on
lower-than-expected interest and tax charges and said on
Thursday it was confident in its outlook despite weakness in its
key U.S. textbook market.
The owner of the world's largest education business, the
Financial Times and Penguin Books said it expected adjusted
earnings per share of about 83 pence ($1.33) per share, up from
its previous guidance of 80 pence.
"We can't count on the trading environment to get any easier
any time soon, but we do expect our durability and our
innovation to continue to help us succeed," Chief Executive
Marjorie Scardino said in a statement.
Pearson said its investments in education technology and
developing markets had enabled its education business to grow 7
percent, with a 1 percent rise in its North American Education
division, which accounts for nearly half of group sales.
The overall markets for U.S. school and college textbooks
declined by 11 percent and 2 percent respectively as states cut
public spending, Pearson said. Rival McGraw-Hill's
education division sales fell 11 percent in the third quarter.
Shares in Pearson, which have strongly outperformed the
wider market this year so far, were flat in early trading, while
the European media sector was down 0.5 percent.
"The upgrade to guidance should obviously be taken well. But
our concerns very much remain: the North American education
market is undergoing rapid structural change," Liberum Capital
media analyst Ian Whittaker wrote in a note.
"While we do not doubt Pearson's strong management and
strategic moves, the share price outperformance vs. the sector
and FTSE (close to 20 percent) means there is little room for
disappointment," he wrote, keeping his "hold" recommendation.
Sales at the FT Group rose 7 percent in the first nine
months of the year, as digital subscriptions smoothed out
Penguin sales were flat -- with a line-up of authors
including Patricia Cornwell and Jamie Oliver expected to boost