Share Price & Sales Performance of Pearson Plc

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Abstract

In this study we try to explore the concept of Share Price & Sales Performance in a holistic context. The main focus of the research is on the effectiveness of Share Price & Sales Performance. The research also analyzes the Share Price & Sales Performance and tries to gauge its effectiveness by analysing the Pearson Plc, the market leader in the publishing industry. The study follows the secondary research methods for the data collection and data analysis. Finally the research provides the recommendations and suggestions and also states some technological implications on Pearson Plc's sales performance and share price.

Table of Contents

ABSTRACTII

CHAPTER 1: INTRODUCTION1

Current Performance2

Restructuring and Development3

New Markets Sustain Revenue4

Technological Shift5

Justification for Research6

Pearson Plc7

Research Objectives8

CHAPTER 2: LITERATURE REVIEW9

Identification9

Significance9

Types9

Considerations10

Improving Sales Perfomrance10

Sales Performance Management11

CHAPTER 3: METHODOLOGY14

Outline of the Study14

Research Procedure- Exploratory Study14

Research Philosophy15

Problem Statement16

Research Design16

Research Method16

Data Analysis17

CHAPTER 4: ANALYSIS18

SWOT Analysis18

Financial Performance19

2011 Profitability24

2011 Valuation25

2011 Operations25

2011 Financial25

2011 Per Share Data25

2011 Growth26

CHAPTER 5: RECOMMENDATIONS & CONLUSIONS30

Key Success Factors30

Competitive Environment31

Technological Implications32

REFERENCES34

CHAPTER 1: INTRODUCTION

Lower disposable income hampered discretionary spending on books and, therefore, hampered Global Book Publishing industry growth during the past five years. A transition toward digital technology also dented revenue due to the difficulty of pricing e-books, which are intrinsically different from printed products. The investments necessary to transition toward digital publishing also led to consolidation within the industry; they resulted in a 2.5% annualized decline in firms to 16,467 in the five years to 2012. New forms of entertainment also forced book publishers to increasingly compete with other media, including self-publishers and free e-books. Consequently, the industry is forecast to decline at an annualized five-year rate of 2.5% to total $108.7 billion in 2012, which includes a 3.7% drop in 2012 alone.

Nonetheless, the industry is addressing several opportunities. Most markedly there has been rapid growth in e-books sales, albeit off a very low base. As publishers develop efficient pricing and distribution models for these books, the industry is expected to benefit from lower production costs and higher volume sales. Sales volumes are expected to increase because e-books are generally cheaper and more accessible for consumers to buy. They also provide consumers with more choices in what to read. Another opportunity for the industry is in the form of rising disposable income and literacy rates in newly industrialized countries like Brazil, Russia, India and China. Consumers in these markets are buying an increasing number of books and represent a significant share of the world population. They are also increasingly educated and, as a result, sales growth of educational and professional titles is expected to have exceeded sales growth of consumer titles. The transition toward higher-priced education and professional titles and the shift toward e-books are expected to result in industry profit expansion during the next five years.

Disposable income and literacy growth during the next five years will support industry growth. The increasing use of the internet will facilitate book sales, and the convenience of e-books will also expand the overall book market. As a result, industry revenue is forecast to ...