Scardino hints at an exit as Pearson announces record profits

The publisher has seen profits jump by almost 80%. A good time for boss Marjorie Scardino to leave?

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Last Updated: 03 Oct 2012

2010 has seen a raft of high-profile CEO resignations, including Tesco’s Sir Terry Leahy and Asda’s Andy Bond (not to mention the imminent demise of BP CEO Tony Hayward). And another may be added to the list before long: Dame Marjorie Scardino, CEO of publishing group Pearson and one of the few women running big British public companies, is apparently ‘preparing a successor’ to her post. Although Scardino is being distinctly cagey about when (/if) she’ll make her big exit, the announcement comes in the wake of record results for the company. And let’s be honest: if there’s ever a good time to hand over the reins, it’s when the company is going great guns...
 
Scardino's exit would be the end of an era for Pearson, which owns the likes of the FT and Penguin books. The first woman to be appointed CEO of a FTSE 100 company, she's been at the helm since 1997 - making her the eighth longest-serving boss in today's FTSE 100. No offical word yet on possible successors, but word is that FT chief exec John Ridding and group finance director Rona Fairhead are both in the running for the top job (so it could still be run by a woman even after Scardino leaves). But Scardino herself is keeping mum. In fact, she's refusing to acknowledge that she's even thought about it, telling journalists that even if she were considering retirement, ‘I wouldn’t be talking about it’. And no wonder - although every CEO worth his or her salt will have a succession plan in mind, talking about definite exit dates inevitably affects their ability to manage the process.
 
The reports come after the group announced its operating profit for the last six months hit £178m – an impressive 79% jump. The group says the rise was down to ‘strong sales’ in its textbook and Penguin divisions, which prompted Scardino to point out that the group is now steering its business model towards education. ‘Pearson is all about education... learning through people’s whole lives, formally or informally, for business or pleasure, in primary school, in a retirement home, everywhere,’ she said. Very civic-minded – but more importantly, education is always going to be a nice little earner: people need to learn, whether there’s a recession on or not.
 
There’s an interesting footnote to the story, as well: one of the group’s biggest earners was the FT Group, which boosted its revenues from £176m in the first six months of 2009 to £190m during the same period this year. Growth was boosted by a 27% increase in online subscribers, which rose to 149,000 (including more than 1,000 corporate licenses), while its iPad app was downloaded almost a quarter of a million times. An indication, perhaps, that once consumers have got used to it, a paywall doesn’t necessarily have the devastating effect on newspapers that some critics are making out…

In today's bulletin:
Hayward out, Dudley in as BP plummets to record loss
Ofcom slams ISPs for misleading advertising
Halfords sales head downhill - but profits remain on track
Editor's blog: The lessons of Tony Hayward
Scardino hints at an exit as Pearson announces record profits

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