Book value

17 October 2017 By Liam Proud Follow @liamwardproud

The education publisher issued a slightly more optimistic forecast for operating profit and said its U.S. textbook business is unlikely to repeat its catastrophic 2016. But Pearson has misread its key market before. The shift to digital publishing still looks painful.

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Pearson on Oct. 17 narrowed its full-year forecast for operating profit to 576 to 606 million pounds from 546 to 606 million pounds.

Revenue in the publisher’s key U.S. higher education courseware business, which covers college and university textbook sales, fell 1 percent year-on-year in the first nine months of 2017 excluding the effects of currency moves, mergers, and acquisitions.

Revenue from Pearson’s higher-education courseware businesses in North America fell 18 percent in 2016.

A hit from lower U.S. college enrolments so far in 2017 and increasing use of second-hand textbooks was partly offset by increased digital revenue and fewer textbook returns from bookstores, Pearson said.

U.S. higher education digital courseware revenue rose by 11 percent and e-book revenue increased by more than 20 percent in the first nine months of 2017.

Pearson shares were up 5.6 percent to around 656 pence at 0850 BST.

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