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Business Review - Pearson Education - Professional

Professional: overview

* Professional education is not technically a segment under IFRS and therefore has no segment specific key performance indicators.

Our Professional education business* publishes educational materials and provides testing and qualifications services for adults. Our publishing imprints include Addison Wesley Professional, Prentice Hall PTR, Cisco Press (for IT professionals), Peachpit Press and New Riders Press (for graphics and design professionals), Que/Sams (consumer and professional imprint) and Prentice Hall Financial Times (for the business education market). We have a fast-growing Professional Testing business, Pearson VUE, which manages major long-term contracts to provide qualification and assessment services through its network of test centres around the world. Key customers include major technology companies, the Graduate Management Admissions Council, the National Association of Securities Dealers and the UK's Driving Standards Agency. We also provide a range of data collection and management services, including scanners, to a wide range of customers.

Professional: 2006 performance
£ millions 2006 2005 Headline
Sales 627 589 6% 3%
Adjusted operating profit 60 45 33% 29%
Note: includes Government Solutions

Professional Testing: rapid organic sales and profit growth

  • Professional Testing sales up more than 30% in 2006 (and have doubled over the past two years). Approximately 4m secure online tests delivered in more than 5,000 test centres worldwide in 2006.
  • Successful start-up of the worldwide Graduate Management Admissions Test. 220,000 examinations delivered in 400 test centres in 96 countries, in first year of new contract.
  • Professional Testing moves from around breakeven in 2005 to profitability in 2006.
  • Successful integration of Promissor, acquired in January 2006. Combination brings together two leading international professional testing companies and takes Pearson into new US state and federal regulatory markets.

Professional publishing: further margin improvement

  • Technology publishing profits up as further cost actions offset continued industry weakness.
  • Strong performance from Wharton School Publishing and FT Press imprints, aided by Pearson's global distribution and strong retail relationships. 41 titles published in 2006 including Jerry Porras, Stewart Emery and Mark Thompson's Success Built To Last (the sequel to Built To Last) and Jeffrey Gitomer's The Little Red Book of Sales Answers, The Little Gold Book of Yes Attitude. Three Wall Street Journal business bestsellers, two BusinessWeek bestsellers and one New York Times bestseller in 2006.

Government Solutions: sale completed in February 2007

  • Sale of Government Solutions to Veritas Capital for £560m in cash, £40m in preferred stock and a 10% interest in the company completed in February 2007.
  • Government Solutions contributed £286m of sales and £22m of operating profit to Pearson in 2006.

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