Pearson sees sales fall after 'challenging' trading in the US

Pearson, the world's largest education company, posted worse-than-expected trading in the third quarter of its year with sales dragged lower by falls at its US education business.

It said nine-month underlying sales fell by 7%, due to weak demand for coursework materials in its North American higher education unit. Analysts had expected a nine-month fall of 5%.

The group, which sold the Financial Times newspaper and its stake in The Economist magazine in 2015 to concentrate on education, has been hit by several profit warnings in recent years.

It announced a restructuring plan in January that includes 4,000 job cuts and higher investment in digital services and emerging markets.

However, due to cost cuts the group reiterated its full-year 2016 forecast of adjusted operating profit of between £580m and £620m ($720m and $771m).

Chief executive John Fallon said: "While market conditions continue to be challenging, particularly in higher education, thanks to tight cost management we are on track to deliver our guidance this year, and to achieve our long-term growth goal."

"We have achieved more than 90% of the growth and simplification restructuring programme we announced in January."

Analysts at Numis said Pearson's underlying performance "remains a little softer than we had modelled". Shares fell more than 6% to 780p in early trading.