Pearson shares sink on CEO comments

Shares in education publisher Pearson fell sharply on Thursday following comments by chief executive officer John Fallon the previous day.

Speaking at the Morgan Stanley European Technology, Media and Telecom Conference in Barcelona on Wednesday, Fallon said that when considering a capital allocation, the company’s first priority was to protect the dividend.

Pearson also said it expects total US college enrolments to shrink by around 2% this year.

Shares in the company fell further on Thursday after Bloomberg cited Peel Hunt analyst Alex De Groote as saying that he expects Pearson to issue another profit warning in the next few weeks and then to cut the dividend.

At 1105 GMT, Pearson shares were down 5.6% at 773.00p.