Pearson delivered its promised double-digit earnings growth during 2002, but its business daily Financial Times slipped into the red during the second half of last year.
Tough advertising conditions for the title's key categories - financial services, technology and business to business - meant that advertising volumes across the daily fell 24% during the year and ad revenues were down 23%.
Circulation at the paper fell 6% to an average 473,587.
The company is not expecting an advertising recovery across its business papers during 2003.
Marjorie Scardino, chief executive of Pearson, said: "Last year we increased earnings, generated more cash and improved our return on capital, even though we faced an advertising recession far deeper than expected. Our broadly-based education business and Penguin recorded good growth. While the economic environment is uncertain, we are confident we will make further progress on earnings, cash and returns this year."
This article was first published on Media Week