UPDATE 2-Pearson raises full-year guidance again

* Raises guidance even amid uncertain outlook

* 9-month sales up 7 percent

* Shares up 0.6 percent

(Adds details, quote)

By Kate Holton

LONDON, Oct 25 (BestGrowthStock) – British publishing group Pearson
(PSON.L: ) raised its full-year outlook again on Monday, saying it
now expected adjusted earnings per share to be up 10 percent due
to growth in its U.S. College and Financial Times units.
Analysts said Pearson, which had previously predicted
adjusted EPS of around 70 pence or a 7 percent increase, could
still surprise further, sending its shares up 0.6 percent.

The educational technology provider and Penguin Books owner
said it had raised its guidance despite the uncertain
macroeconomic outlook after posting a 7 percent rise in sales in
the first nine months on constant exchange rates.

Sales at Penguin were up 5 percent, the education business
was up 7 percent and the Financial Times group was up 11
percent, with the latter boosted by strong demand for its print,
digital subscriptions and growth in advertising.

Overall adjusted operating profits were up 15 percent.

“The end of the year is a key selling season in education
and consumer publishing, and both businesses face tough
comparables in the fourth quarter of 2010,” the group said.

“However, we are trading ahead of previous guidance and we
now expect full year adjusted earnings per share to increase by
approximately 10 percent on the 2009 base of 65.4 pence.”

Analysts at UBS said the strong trading had been boosted by
a good performance from the U.S. College unit and market share
gains in U.S. schools. It said the 10 percent growth would imply
an adjusted EPS of 72 pence.

“Pearson however have a track record of being conservative
and with Q4 still sizeable for College/Penguin, we would expect
Pearson to again beat guidance when they report full-year
results in February 2011,” they said.

“We believe that consensus will ultimately move closer to
our 74 pence of EPS,” they said.

In education, Pearson said its strategy of moving from a
pure book publisher to the leading educational technology
provider had enabled it to gain market share in the North
American market, with sales growth of 5 percent.

The Higher Education unit grew strongly and gained market
share while the Assessment and Information business remained
strong. Pearson said its strength in digital was helping it to
grow the School Curriculum business despite weakness in state
and local funding.

“We are planning on the basis that school funding remains
under pressure in 2011 and that the total new adoption
opportunity will be lower than in 2010,” it said.

Sales in International Education were up 8 percent in the
nine months, due to growth in developed markets and assessment
services. Professional Education also traded strongly, with
sales up 17 percent due to good growth in testing, IT and
Professional segments.

The guidance includes the profit contribution from
Interactive Data for seven months of 2010, compared with a full
year in 2009, and assumes that the current exchange rate of 1
pound to $1.57 prevails in the fourth quarter.
(Reporting by Kate Holton; Editing by Julie Crust and Jon
Loades-Carter)

UPDATE 2-Pearson raises full-year guidance again