Pearson Education
Sales at Pearson Education increased to GBP2.044 billion. Stripping out the benefits of the acquisition of National Computer Systems (NCS), completed in September, sales increased by 11% and profits by 22% as Pearson Education continued to develop new online and print products and services. The acquisition of NCS, the leading provider of assessment, testing and software services to US schools, is transforming Pearson Education, enabling it to capitalise on the worldwide movement towards accountability in education and to personalise learning through the alignment of testing and assessment with curriculum and content.
NCS Pearson has met our revenue and profit expectations, benefiting from its leadership both in state testing and delivering enterprise software solutions to schools. Its latest product, NCS4School, will launch this summer. The integration of NCS Pearson with Pearson Education and Learning Network is on track to deliver $50 million of annual cost savings by the end of 2002.
Our US School business increased sales by 23%. Excluding revenues from NCS, sales were up 10%.
Building on a very strong performance in 1999, we made significant market share gains in some key adoptions, benefiting from a range of new print and online programmes. In secondary science, Prentice Hall School took a 40% share in the major state adoptions including California and our new Scott Foresman reading programme grew market share from less than 5% to approximately 25% nationwide. We continued to build on the success of our best selling math programmes and took the leading position in secondary social studies.
The US Higher Education & Professional business increased sales by 17%, gaining market share and growing margins. Excluding the NCS business, sales were up 9%. The college business delivered particularly strong growth in math, computer sciences, history and developmental English and continued to invest in combined text and online programmes, which helped to mitigate the impact of lower growth rates in the consumer IT publishing market.
The International business increased sales to GBP540 million. Excluding the NCS business, sales increased by 18%. Our major international operations all reported double digit revenue growth, with particularly strong progress in Latin America and English Language Training. We extended our lead in the international education market through a series of acquisitions in France, Brazil, Korea and Japan.
The integration of the Simon & Schuster and Addison Wesley Longman businesses is now completed, and, in 2001, is expected to deliver the projected $130 million in annual cost savings.
FT Knowledge made losses of GBP17m as it invested in developing its global corporate learning and executive education businesses, a market that continues to experience rapid international growth. FT Knowledge acquired The Forum Corporation, one of America’s top corporate training companies; extended its financial training company, New York Institute of Finance, to Europe and Asia; launched FT Dynamo, a subscription portal focusing on world-class management thinking; and continued to develop online courses for the finance, investment and marketing professions.
Pearson launched its consumer education portal, Learning Network, in September 2000. It is already established as the leading consumer education source on the web, generating more than 130 million page views in February 2001, and provides learning content and services for teachers, students and parents in the K-12, professional development and lifelong learning and reference markets. Learning Network will launch its Higher Education offering later this year. We expect Learning Network to increase revenues strongly this year as it moves towards breakeven by the end of 2003. Pearson Broadband, a new initiative to create interactive education television for K-12, Higher Education, Professional and Lifelong Learning markets, will launch its first products later this month.
