Mixed Results: Harcourt, Thomson, Pearson Ed

by Jim Milliot -- Publishers Weekly, 3/21/2005

In addition to Houghton Mifflin, all the other major educational and professional publishers weighed in with results for 2004 over the last several weeks.

Reed Elsevier reported that sales in its Harcourt Education subsidiary fell 3%, to £868 million ($1.57 billion), with sales in its U.S. publishing and testing business down 4%, to £774 million. Operating profit fell 6%, to £164 million. Excluding currency translations, total revenue was up 7% and profits ahead 5%. Harcourt benefited from its June 30 purchase of Saxon, which generated sales of $86 million for the full year. Reed expects organic sales to increase 9%–10% in 2005.

Thomson Corp. said sales at Thomson Learning increased 6% last year, to $2.17 billion, while operating profits fell 3%, to $327 million. Improved revenue in the global higher-education market, higher sales of electronic products, including electronic library reference materials, plus acquisitions drove the sales gains. Sales of print reference products for libraries fell in the year. The decline in profits was attributed to one-time charges.

Total revenue at Pearson Education fell 4%, to £2.36 billion ($4.26 billion), and operating profits declined 6.4%, to £293 million ($530 million). Excluding currency translations, sales were up 4% and earnings increased 5%. Sales in the school group were down 5% (flat, excluding currency changes), to £1.12 billion. A decline in elementary school sales was offset by gains to the secondary school market and improved sales in supplementary publishing. Sales in the higher education group fell 5% (up 4% excluding currency changes), to £731 million. In the U.S., sales to two-year colleges were particularly strong, while sales in math and modern languages were also up.