Thomson Reuters profit beats, finance unit shows growth
Reuters
Published Jul 29, 2015 11:53AM ET
Thomson Reuters profit beats, finance unit shows growth
(Reuters) - Thomson Reuters Corp (N:TRI) (TO:TRI) on Wednesday reported higher-than-expected quarterly profit as the company's biggest division that serves banks and financial institutions showed underlying revenue growth for the first time since 2011.
Revenue at its Financial & Risk segment rose 1 percent in the second quarter when excluding currency and acquisitions.
"It was very encouraging to see organic growth in F&R," said Jefferies analyst Dan Dolev. "Everybody has been waiting for it. They delivered it."
Thomson Reuters shares, which had been down more than 6 percent in 2015 through Tuesday, rose 4.5 percent after the results, their best one-day move in about four years.
The news and information company posted underlying revenue increases across its four main divisions.
"The quarter and the first half just confirms the momentum that is building inside the business," Chief Executive Jim Smith said in an interview.
Second-quarter net earnings were $281 million, or 33 cents per share, compared with $260 million, or 31 cents per share, a year ago.
Adjusted for special items, earnings were 52 cents per share. Analysts, on average, were looking for 50 cents per share, according to Thomson Reuters I/B/E/S.
Revenues fell 4 percent to $3.04 billion, but rose when factoring out currency rate swings. That was slightly below Wall Street estimates of $3.07 billion, based on a survey of 12 analysts who follow the New York-listed shares.
In its Financial & Risk segment, revenue was $1.55 billion. Revenues in the Americas and Asia each rose by 1 percent, while they were flat in Europe, Middle East and Africa. The division's net sales outpaced cancellations - a key indicator of future growth.
"We have seen the underlying momentum now over the past couple of years," Smith said about the key division, which represents more than half of the company's overall revenue. "I am confident in the trajectory, and we will maintain that trajectory of continued improvement."
Jefferies' Dolev said the company has been successful in migrating customers to new versions of its Eikon financial platform.
Revenue in its Legal business, which includes the Westlaw legal database, was $840 million, rising 2 percent on an organic basis. Tax & Accounting sales increased 5 percent organically.
The company reaffirmed its 2015 forecast, including the expectation for positive organic revenue growth. It said it continues to project that currency is likely to have a higher-than-usual impact on 2015 results.
Thomson Reuters, which is the parent of Reuters News, competes for financial customers with Bloomberg LP, as well as News Corp's (O:NWSA) Dow Jones unit.
Get The News You Want
Shares were up 4.2 percent at C$50.73 in Toronto and 4.5 percent at $39.36 in New York trading.
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.