PUBLISHER Pearson has reported a 12.5 per cent rise in profits, but said its Penguin books arm had continued to struggle.

Pearson said pre-tax profits for the year to December 31 rose to '171m from '152m the year before.

The publisher of the Financial Times said its subsidiaries FT Group and Pearson Education turned in growth in adjusted operating profits of 69 per cent and five per cent respectively.

It said it continued to expect strong growth at the two divisions, with the loss-making FT set to break even in 2005 after advertising revenues at the newspaper rose for the first time in four years.

However, it said operating profits at Penguin slid 24 per cent to '54m during a difficult year, with flat sales and significantly lower profits despite a successful publishing schedule.

Chief executive Marjorie Scardino said Pearson was confident its performance would be within market expectations despite the problems at Penguin.

"In the longer term, we have set the stage for a new phase in Pearson's growth, with our network of business newspapers returned to profit and excellent prospects for our education businesses for the next few years," she said. Tweet