Pearson Finals

[idpickering]

Revenue down 1% in underlying terms

· Total underlying revenue down 1% year on year, with declines in US Higher Education Courseware of 5% and in US K12 Courseware largely offset by the rest of the business growing in aggregate at over 1%.

· Strong performance in our structural growth opportunities with revenue up 10% in Global Online Program Management, 8% in Connections Academy, 4% in Professional Certification (VUE) and Pearson Test of English Academic (PTEA) test volume growth of 30%.

· Revenue in North America declined 1%, Core was flat and Growth up 1%.

https://www.investegate.co.uk/pearson-p ... 00058051Q/

[csearle]

And the relevant bit...

The directors are proposing a final dividend of 13.0p per equity share, payable on 10 May 2019 to shareholders on the register at the close of business on 5 April 2019. This final dividend, which will absorb an estimated £102m of shareholders' funds, has not been included as a liability as at 31 December 2018.

[kempiejon]

Cheers Ian,
So that's 13p this year's final, up from 12p last year. Total of 17p and 18.5p an increase well above inflation but far from the heady 50p a year I was buying at.

[idpickering]

And the relevant bit...

The directors are proposing a final dividend of 13.0p per equity share, payable on 10 May 2019 to shareholders on the register at the close of business on 5 April 2019. This final dividend, which will absorb an estimated £102m of shareholders' funds, has not been included as a liability as at 31 December 2018.

I would've got to that bit but the bathroom was beckoning.

Ian.

[idpickering]

This from TMF;

I’d shun this FTSE 100 recovery hopeful to make this potentially great investment

FTSE 100 publisher and learning services provider Pearson (LSE: PSON) has endured a turbulent recent history, which is obvious in the dividend-slashing that carved around two thirds from the payment in 2017 following a series of profit warnings.

If we are buying the shares now, I reckon it must be for the firm’s recovery potential. But the emaciated dividend leaves a lot to be desired with the yield running at around 2.25% at today’s share price around 891p. So I wouldn’t be attracted to this firm as an income investment.

https://www.fool.co.uk/investing/2019/0 ... nvestment/

[Arborbridge]

Well, at this precise moment, and with perfect hindsight, it looks as though I should have gone through with my proposed sale a few weeks ago. At that time, the price had some nice froth on it and I should have gone ahead and set that stoploss which would have sold out not far below the peak.

Still, that's what I should have done from today's perspective. Reality has kicked in with the share price, the froth has well and truly come off along with excessive hope, so it wouldn't surprise me if it comes further down before recovering - looking at the curve on the chart. I'm in for an even longer haul now, which ties up a nice chunk of capital which could be earning double elsewhere.

Such are the "fortunes of war".


Arb.

[Itsallaguess]

Still, that's what I should have done from today's perspective.

Reality has kicked in with the share price, the froth has well and truly come off along with excessive hope, so it wouldn't surprise me if it comes further down before recovering - looking at the curve on the chart.

I'm in for an even longer haul now, which ties up a nice chunk of capital which could be earning double elsewhere.

I remember thinking like that myself in the past Arb, many times, and then I realised that, actually, the only thing 'tying up my capital' was me....

Over the history of building and owning my HYP, most of the things I would change (with hindsight on both sides of the coin....) would involve many of those periods of inaction, and rarely those periods of action....

Cheers,

Itsallaguess

[TUK020]

Shorttracker
https://shorttracker.co.uk/companies/?sort=2&d=desc

Pearson are number 5 on the list with 10 funds shorting 9.6% of stock.
This fails my 'sleep at night' test.
I bailed out of these shortly after my assessment of what I could have done differently on Carillion.

[Arborbridge]

Shorttracker
https://shorttracker.co.uk/companies/?sort=2&d=desc

Pearson are number 5 on the list with 10 funds shorting 9.6% of stock.
This fails my 'sleep at night' test.
I bailed out of these shortly after my assessment of what I could have done differently on Carillion.

Going back towards its previous peak, by the looks of it. As I mentioned, reality has kicked in so the price has come back to the previous "normal" for a while. The shorts will stay on until there is an improvement in performance - it'll be a long haul with only a small increase in dividend to be going on with.

I have no trouble sleeping at night but just feel I could have done better by not being so "HYP" in this case.


Arb

[bluedonkey]

For once, Pearson's adjusted EPS is actually lower than the basic EPS, 70.3p versus 75.6p. In each of the previous four years, the adjusted EPS was higher than the basic. Here's the summary for 5 years:


Perhaps with hindsight, the massive shortfall of basic EPS compared to the divi in 2014 and 2015 were warning signs of the impending divi cut.

[Arborbridge]

For once, Pearson's adjusted EPS is actually lower than the basic EPS, 70.3p versus 75.6p. In each of the previous four years, the adjusted EPS was higher than the basic. Here's the summary for 5 years:


Perhaps with hindsight, the massive shortfall of basic EPS compared to the divi in 2014 and 2015 were warning signs of the impending divi cut.

That is pretty clear! What is not so clear is whether one would really have done much about it at the time. By that, I mean in 2015 one might well have given them some time to sort out what might have been a passing problem. By results time in 2016 it was too late, I suspect.
I wonder what Nick Train was looking at?

Arb.