London-headquartered media group Pearson has narrowed first-half losses despite the ongoing ad slump at its flagship Financial Times.

The group posted a pre-tax shortfall of £138 million ($224m; €195m) for the six months ended June 30, down from £188m in first-half 2002. However, much of this improvement reflects lower goodwill charges than last year; stripping out these as well as exceptional items and integration costs, Pearson’s pre-tax earnings slipped from £26m profit last year to a £1m loss. Sales, meanwhile, slid from £1.81 billion to £1.67bn.

One of the group’s biggest headaches is the performance of the FT, where advertising revenues plummeted 18% in the first half. Circulation is also a problem for the title: from January to June, average daily sales were down 5% year-on-year, and according to a study by British magazine Campaign, UK sales of the FT tumbled 12.1% – despite a much-hyped revamp.

Total revenues at the title sank from £115m to £102m, while operating losses slipped from £11m to £15m. However, the FT Group, of which it is part, performed better: sales stayed flat at £370m (a 5% decline on an underlying basis) while operating profits increased from £38m to £43m – and Pearson expects the unit to post a rise in full-year earnings.

The group’s chief executive Dame Marjorie Scardino stayed upbeat. “Our book publishing operations are proving resilient and performing well ahead of their competitors. Our business newspapers, with lower costs and improved content, will bounce back strongly when business advertising recovers.”

Data sourced from: multiple sources; additional content by WARC staff