Publishing group Pearson has announced a first half loss of £1m ($1.6m), blaming falling advertising revenues and sales for the slide.
More cuts ahead for the Financial Times
The results were well down from a £26m profit made in the same period last year, but still at the top end of market expectations.
Sales also fell to £1.67bn from £1.81bn a year ago.
Although Pearson was upbeat about the full year, it warned advertising conditions remain harsh.
The publishing group also said it would continue to cut costs at the Financial Times newspaper, earmarking another £15m of savings for 2004 after cutting £13m this year.
The FT has been battling tough conditions with sales down 5% to a daily average of 461,000 in the six months to June 30. Advertising revenues fell 18%.
Chief executive Marjorie Scardino said: "We are confident about the full year because we are making the most of our strong market positions and operating on much lower costs."
She added the group's book publishing operations - which include Penguin - had proved resilient and were performing ahead of competitors.