The company’s 2020 preliminary results revealed that underlying revenue declined 10%, with total sales dropping 12% to £3,397m (2019: £3,869m) and net cash generated from operations falling from £480m in 2019, to £450m in 2020.
Test centre closures contributed to a 22% fall in total testing volumes, despite “strong growth” in Online Proctoring.
“Despite the significant challenges of 2020, it is thanks to the tenacity and commitment of colleagues around the world that Pearson has delivered a solid financial performance,” Andy Bird, Pearson’s chief executive, said.
“Pearson’s strategy is now geared around three key demand-led global market opportunities“
“Our purpose has never been so relevant: we exist to help everyone achieve their potential through learning.
“I have enormous optimism in the future and our ability to unlock our potential and drive sustainable growth.”
The company is moving at “pace and ready to enter a new era as a digital-first company” following significant investments in technology and comprehensive restructuring, Bird added.
Indeed, the sale of its stake in Penguin Random House and lower restructuring costs “more than offset” the impact of Covid-19, the company highlighted, with its statutory operating profit rising from £275m in 2019, to £411m in 2020.
“Pearson’s strategy is now geared around three key demand-led global market opportunities which play to all our strengths: the rise in online and digital learning; addressing the workforce skills gap; and meeting the growing demand for dependable accreditation and certification,” Bird continued.
“Our existing assets, strong balance sheet, new organisational structure and priorities will enable us to seize these opportunities.”
The report highlighted that Global Online Learning sales were up 18% in 2020, while both Global Assessment and International were down 14% and 19%, respectively.
“Sales declined 10% at Pearson VUE reflecting the impact of the test centre closures in the first half of the year, with pent up demand in the second half partially moderated by further lockdowns in Q4,” the company report noted.
However, Online Proctoring saw “strong growth”, rising from 0.2m at the end of 2019 to 2.1m at the end of 2020, which was predominantly driven by demand from the IT sector.
“Overall testing volumes were down 22% to 12.9m due to test centre closures,” Pearson said.
The 19% drop in International sales was due to “the interruption of Australian immigration and test centre closures impacting PTE, as well as budgetary pressures caused by the impact of Covid-19 on courseware purchasing”.
Volumes for the PTE language exam were down 36% in all key markets but China, where Pearson saw 17% growth due to “an improved competitive performance”.