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Pearson lifts profit and eyes further growth in FY26, IAG posts another 'record' year
By Iain Gilbert
Date: Friday 27 Feb 2026
(Sharecast News) - LONDON PRE-OPEN
The FTSE 100 was expected to open 35.8 points ahead of the bell on Friday, after wrapping up the previous session 0.37% firmer at 10,846.70.
STOCKS TO WATCH
Education and assessment provider Pearson said on Friday that it had delivered on its goals in 2025, with both underlying sales and adjusted operating profit growth, leaving the firm confident in its outlook for 2026. Pearson said underlying sales rose 4% for the year to £3.57bn, while adjusted operating profits increased 6% to £614m, lifting its operating margin from 16.9% to 17.2%. Operating cash conversion remained strong at 93%, supported by high fourth‑quarter sales, and free cash flow rose 8%, giving a 125% free‑cash‑flow conversion rate. Looking ahead, Pearson guided to mid‑single‑digit underlying sales growth, adjusted operating profits of £640m-£685m, and free‑cash‑flow conversion of 90%-100%.
UK aerospace and defence firm Melrose on Friday targeted 2026 earnings of £700m-750m after a 21% jump in profits last year as global tensions sparked a "significant" increase in military spending. Adjusted pre-tax profits came for the year ended 31 December came in at £515m, up from £438m a year earlier. Melrose also unveiled a £175m share buyback.
British Airways and Iberia owner IAG said on Friday that it had delivered another "record" financial performance in 2025, with operating profits up 13% and revenue 3.5% higher at €5bn and €33.2bn, respectively. Chief executive Luis Gallego said: "We are confident as we look to the future, with compelling market dynamics, long-term secular growth and a clear plan to leverage our business model and deliver our strategy."
NEWSPAPER ROUND-UP
Peter Mandelson is facing an inquiry by the EU's anti-fraud agency after the European Commission requested the body look into his activities during his time as trade commissioner in Brussels. The commission said it referred the peer, 72, to the European Anti-Fraud Office, known as Olaf, last week after the US Department of Justice released documents allegedly showing he shared sensitive government information with sex offender Jeffrey Epstein. - Guardian
Ministers will take another step towards banning social media for under-16s next week as they launch a consultation on the policy, with government insiders increasingly certain Keir Starmer will back the idea. Liz Kendall, the technology secretary, will publish the terms of reference for the consultation, which is expected to explore options including an age limit and less hardline action such as curbs on infinite scrolling. - Guardian
The publisher of the Mirror and Express newspapers has suffered a plunge in online readership across its regional titles as it reels from Google's algorithm changes. Reach, which owns dozens of local news titles across the UK, saw sharp drops in both page views and visitor numbers last month. Page views of Surrey Live, one of its properties, tumbled almost 85% to 4.3m in January, down from 28.2m at the same time last year, according to figures from Ipsos. - Telegraph
Britain's biggest bank is to stop opening accounts for customers at its branches and instead force them to go online. Lloyds Bank's staff will no longer open joint, premium or student accounts in branches or switch customers from another lender - a move that critics warned signalled "the death of branch banking". - Telegraph
Barclays and Jefferies, the American bank, are reportedly among lenders with multimillion pound exposures to a UK mortgage provider that has collapsed amid allegations of fraud. The FTSE 100 bank is said to have an exposure of £600m to Market Financial Solutions, which entered administration after a High Court judge said "very serious" allegations of fraud needed to be investigated, prompting the latest source of alarm about the private credit industry. Jefferies has a reported exposure of £100m. - The Times
Daniel Kretinsky, the Czech billionaire investor who clinched the audacious takeover of Royal Mail's owner last year, has been called to give evidence to MPs over "significant concerns" about its postal services performance. The business and trade select committee has asked for Kretinsky, the chairman of International Distribution Services, the parent company, and Alistair Cochrane, the Royal Mail chief executive, to attend amid increasing scrutiny from ministers and Ofcom, the regulator, of its failure to hit delivery targets. - The Times
US CLOSE
Major indices finished mostly lower on Thursday, with a sharp plunge in tech behemoth Nvidia weighing heavily on the Nasdaq as record quarterly results from the company failed to excite investors.
At the close, the Dow Jones Industrial Average was up 0.03% at 49,499.20, while the S&P 500 shed 0.54% to 6,908.86 and the Nasdaq Composite saw out the session 1.18% lower at 22,878.38.
Reporting by Iain Gilbert at Sharecast.com
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