Thomson Reuters Reports Second-Quarter 2011 Results
(Thomson Reuters ONE) -
* Revenues grew 4%, before currency
* Underlying operating profit up 17%
* Underlying operating profit margin was 20.9%, up 140 basis points
* Adjusted earnings per share were $0.51 vs. $0.41 in second quarter 2010
* Markets division reorganized to drive growth
* 2011 Outlook affirmed
NEW YORK, July 28, 2011 - Thomson Reuters (TSX / NYSE: TRI), the world's
leading source of intelligent information for businesses and professionals,
today reported results for the second quarter ended June 30, 2011. The company
reported ongoing revenues of $3.2 billion, a 4% increase before currency (9%
including currency), and underlying operating profit of $669 million, up 17%.
Adjusted earnings per share (EPS) were $0.51 compared to $0.41 in the prior-year
period. The increase was largely attributable to higher underlying operating
profit and lower integration costs.
"Thanks to the strong growth of our Professional division and margin improvement
across the company, Thomson Reuters posted healthy second-quarter results," said
Thomas H. Glocer, chief executive officer of Thomson Reuters.
"Nonetheless, revenue growth in our Markets division is below our expectations,
and I have decided to accelerate the transformation in Markets, delayer the
organization following a similar move in the Professional division earlier this
year, and make a series of changes in the leadership team. I am confident that
these changes will result in improved performance."
Consolidated Financial Highlights
Three Months Ended June 30,
(Millions of U.S. dollars, except EPS and
margin)
IFRS Financial Measures 2011 2010 Change
Revenues $3,447 $3,216 7%
Operating profit $833 $435 91%
Diluted earnings per share (EPS) $0.67 $0.35 91%
Cash flow from operations $879 $889 -1%
Change Before
Non-IFRS Financial Measures[1] 2011 2010 Change Currency
Revenues from ongoing businesses $3,195 $2,942 9% 4%
Adjusted EBITDA $887 $705 26% 20%
Adjusted EBITDA margin 27.8% 24.0% 380bp 360bp
Underlying operating profit $669 $573 17% 9%
Underlying operating profit margin 20.9% 19.5% 140bp 100bp
Adjusted earnings per share (EPS) $0.51 $0.41 24%
Free cash flow $633 $644 -2%
[1] These and other non-IFRS financial measures are defined and reconciled to
the most directly comparable IFRS measures in the tables appended to this news
release. Additional information is provided in the explanatory note at the end
of this news release.
* Revenues from ongoing businesses were $3.2 billion, a 4% increase before
currency. Strong growth across the Professional division, up 8%, and a 1%
increase in Markets division revenues contributed to the overall increase.
* Adjusted EBITDA increased 26%, and the corresponding margin was 27.8% versus
24.0% in the prior-year period. Excluding currency, adjusted EBITDA
increased 20% and the corresponding margin increased 360 basis points.
* Underlying operating profit increased 17% and the corresponding margin was
20.9%, versus 19.5% in the same period in 2010. Excluding currency,
underlying operating profit increased 9% and the corresponding margin
increased 100 basis points.
* Adjusted EBITDA growth and underlying operating profit growth across both
divisions was due to flow-through from higher revenues, integration savings,
timing benefits in Markets and the benefit of currency.
* Adjusted EPS was $0.51 compared to $0.41 in the prior-year period. The
increase was largely attributable to higher underlying operating profit and
lower integration costs.
Second-Quarter Business Segment Highlights
Unless otherwise noted, all revenue growth comparisons in this news release are
before the impact of foreign currency as Thomson Reuters believes this provides
the best basis to measure the performance of its business.( )All revenue growth
and operating profit comparisons are based upon results from ongoing businesses
and exclude the results of businesses that have been or are expected to be
exited.
Professional Division
Three Months Ended June 30,
(Millions of U.S. dollars, except margin)
Change Before
2011 2010 Change Currency
Revenues
Legal $843 $761 11% 9%
Tax & Accounting $252 $226 12% 10%
Intellectual Property &
Science $211 $197 7% 4%
Professional Division
Total $1,306 $1,184 10% 8%
Margin
Adjusted EBITDA 2011 2010
Legal $314 $287 9% 37.2% 37.7%
Tax & Accounting $72 $56 29% 28.6% 24.8%
Intellectual Property &
Science $71 $70 1% 33.6% 35.5%
Professional Division
Total $457 $413 11% 10%
Adjusted EBITDA Margin 35.0% 34.9% 10bp 50bp
Operating profit
Legal $236 $220 7% 28.0% 28.9%
Tax & Accounting $50 $35 43% 19.8% 15.5%
Intellectual Property &
Science $57 $56 2% 27.0% 28.4%
Professional Division
Total $343 $311 10% 9%
Operating Profit Margin 26.3% 26.3% - 20bp
* During the second quarter, Thomson Reuters announced its intention to sell
its Healthcare business. The planned sale of Healthcare and disposal of
three smaller businesses resulted in a realignment of the company's existing
Intellectual Property and Science businesses into a single operating unit.
Prior-period results have been reclassified to conform to the current
presentation.
* Revenues were up 8%, driven by solid growth across all businesses, in
particular Legal which grew 9% and Tax & Accounting which grew 10%.
* EBITDA increased 11% compared to the prior-year period. The corresponding
margin was 35.0% compared to 34.9% for the prior-year period. EBITDA margin
was largely unchanged as flow-through from higher revenues was partly offset
by the dilutive effect from acquisitions.
* Operating profit was up 10% compared to the prior-year period. The
corresponding margin was 26.3%, unchanged from the prior-year period.
Acquisitions negatively impacted the margin by 140 basis points.
Legal
* Revenues increased 9% from the prior-year period. US Law Firm Solutions grew
2% led by a 12% increase in Business of Law (FindLaw and Elite) and offset
by a 2% decline in research-related revenues. Corporate, Government &
Academic and Risk & Compliance revenues increased 16% (5% organic and 11%
from acquisitions). Global businesses grew 19% (5% organic and 14% from
acquisitions) with strong growth in Latin America and Canada.
* EBITDA increased 9% and the associated margin was 37.2%, compared to 37.7%
in the prior-year period.
* Operating profit increased 7% and the associated margin was 28.0%, compared
to 28.9% in the prior-year period. The decrease was primarily due to the
dilutive effect of acquisitions.
* WestlawNext has been sold to over 24,000 customers since its launch in
February 2010 - representing 41% of Westlaw's revenue base. Customer
feedback continues to be very positive.
Tax & Accounting
* Revenues were up 10%. The Professional business grew 13%, the Corporate
business grew 5% led by growth in income tax provisions and indirect tax
products and the Knowledge Solutions business grew 7% primarily from strong
growth in Checkpoint.
* EBITDA increased 29% and the related margin increased 380 basis points to
28.6% primarily driven by strong flow-through from revenues and the result
of efficiency initiatives.
* Operating profit increased 43% and the related margin increased 430 basis
points to 19.8%. The increase was due to strong flow-through from revenues,
efficiency initiatives and the decline of acquisition accounting-related
costs.
Intellectual Property & Science
* Revenues were up 4% from the prior-year period. Growth was driven by
Scientific & Scholarly Research revenues which were up 5%, led by Web of
Knowledge subscriptions and the Life Sciences business, which was up 11% due
to strong demand for biology and disease analytics products and
acquisitions. IP Solutions was up 2%, driven by growth in Patents and
Services.
* EBITDA was up 1% with the corresponding margin decreasing 190 basis points
to 33.6%.
* Operating profit was up 2% with the corresponding margin decreasing to
27.0%. The decline in EBITDA and operating profit margins was primarily due
to investments in content and technology initiatives to drive growth.
Markets Division
Three Months Ended June 30,
(Millions of U.S. dollars, except margin)
Change Before
2011 2010 Change Currency
Revenues
Sales & Trading $940 $868 8% 1%
Investment & Advisory $558 $550 1% -2%
Enterprise $312 $265 18% 10%
Media $84 $79 6% -1%
Markets Division Total $1,894 $1,762 7% 1%
Adjusted EBITDA $532 $427 25% 13%
Adjusted EBITDA Margin 28.1% 24.2% 390bp 300bp
Operating Profit $388 $312 24% 11%
Operating Profit Margin 20.5% 17.7% 280bp 170bp
* Revenues increased 1%. Strong revenue growth in Enterprise, Commodities &
Energy and Tradeweb was partly offset by weakness in Investment Management
and Exchange Traded Instruments. Revenue growth would have been 2% excluding
a 6% decline in recoveries (pass-through revenues from third-party services
such as exchange fees).
* Recurring subscription-related revenues increased 1%. Transactions-related
revenues increased 7%, primarily due to the increase in the company's
ownership in Tradeweb. Outright revenues increased 19%.
* By geography, revenues in Asia increased 5%; revenues in Europe, Middle East
and Africa (EMEA) increased 2% while revenues in the Americas declined 1%.
* EBITDA was $532 million, up 25%, with a related margin of 28.1%. Excluding
currency, EBITDA increased 13% and the related margin rose 300 basis points.
* Operating profit was $388 million, up 24%, with a related margin of 20.5%.
Excluding currency, operating profit increased 11% and the margin rose 170
basis points due to flow-through of integration savings and timing of
expenses.
* Markets has sold or migrated more than 28,000 Thomson Reuters Eikon desktops
since the launch of the new desktop offering in September 2010.
Sales & Trading
* Revenues were up 1% driven by 7% organic growth at Tradeweb and the
company's increased ownership in the business. Revenue growth was partly
offset by a 10% decline in recoveries. Excluding recoveries, revenues grew
4%.
* The Treasury business was flat in the quarter with growth impacted by 2010
subscription cancellations.
* Revenues from Commodities & Energy grew 5% primarily due to an acquisition,
while Exchange Traded Instruments declined 7%, due to planned shutdowns of
low-margin products and the continued reduction of recoveries revenues as
exchanges move to direct billing.
Investment & Advisory
* Revenues declined 2%. Increases in Corporates, Investment Banking and Wealth
Management revenues were offset by weak performance in Investment Management
which declined 8%.
* Improving performance in Investment Management is a key objective of the
recent reorganization of the Markets division which is described below.
Enterprise
* Revenues grew 10%, driven by continued strong customer demand. The
Enterprise Real Time Solutions business grew 9% as customers continued to
invest in low-latency data feeds and hosting solutions. The Enterprise
Content business grew 20%, driven by growth in pricing and reference data.
The Platform business grew 15%, driven by strong performance in both
recurring and outright revenues. Omgeo's revenues declined 3% due to lower
volumes.
* Thomson Reuters Elektron continued to gain momentum as customers in
established and emerging markets adopted its combination of hosted and
deployed information and trading solutions. In total, 12 data hosting
centers are up and running.
Media
* Revenues decreased 1% as a result of lower online sales.
* The News Agency business was flat due to tight customer budgets. The
Consumer business was down 3% in the second quarter, due to lower online
sales primarily in EMEA and the Americas.
Financial Highlights - Six Months
Six Months Ended June 30,
(Millions of U.S. dollars, except EPS and
margin)
IFRS Financial Measures 2011 2010 Change
Revenues $6,777 $6,356 7%
Operating profit $1,229 $756 63%
Diluted earnings per share (EPS) $0.97 $0.50 94%
Cash flow from operations $1,079 $1,193 -10%
Change Before
Non-IFRS Financial Measures[1] 2011 2010 Change Currency
Revenues from ongoing businesses $6,303 $5,877 7% 4%
Adjusted EBITDA $1,608 $1,400 15% 11%
Adjusted EBITDA margin 25.5% 23.8% 170bp 160bp
Underlying operating profit $1,205 $1,103 9% 5%
Underlying operating profit margin 19.1% 18.8% 30bp 10bp
Adjusted earnings per share (EPS) $0.88 $0.74 19%
Free cash flow $573 $637 -10%
* Revenues from ongoing businesses were $6.3 billion, a 4% increase before
currency. Strong growth across the Professional division, up 8%, and a 2%
increase in Markets division revenues contributed to the overall increase.
* Adjusted EBITDA increased 15%, and the corresponding margin was 25.5% versus
23.8% in the prior-year period primarily due to flow-through from higher
revenues, integration savings and timing benefits in Markets and the benefit
of currency. Excluding currency, EBITDA increased 11% and the corresponding
margin increased 160 basis points.
* Underlying operating profit increased 9% and the corresponding margin was
19.1%, versus 18.8% in the same period in 2010. Underlying operating profit
growth across both divisions was partly offset by the dilutive effects of
acquisitions. Excluding currency, underlying operating profit increased 5%
and the corresponding margin increased 10 basis points.
* Adjusted EPS was $0.88 compared to $0.74 in the prior-year period. The
increase was largely attributable to higher underlying operating profit and
lower integration costs.
* Free cash flow was $573 million, down 10% compared to the prior-year period.
Corporate expenses were $137 million versus $107 million in the prior-year
period.
Integration Programs
At the end of the second quarter of 2011, Thomson Reuters had achieved combined
run-rate savings of $1.54 billion from the Reuters integration and legacy
savings programs. An incremental $40 million in run-rate savings was achieved
during the second quarter of 2011 and included the retirement of legacy
products.
Integration-related costs totaled $42 million in the second quarter and are
forecast to be approximately $200 million for the full-year 2011.
Business Outlook (Before Currency)
The information in this section is forward-looking and should be read in
conjunction with the section below entitled "Special Note Regarding Forward-
Looking Statements, Material Assumptions and Material Risks."
Thomson Reuters today reaffirmed its business outlook for 2011 that was
previously communicated in February. The business outlook is provided for
ongoing businesses and based on 2010 results that have been restated to remove
the results of the Healthcare business as well as other disposals.
Thomson Reuters expects revenues to grow mid-single digits in 2011.
Thomson Reuters expects adjusted EBITDA margin to increase by at least 300 basis
points in 2011 reflecting revenue growth and the completion of integration
programs.
Thomson Reuters expects underlying operating profit margin to increase by at
least 100 basis points in 2011.
The company expects that strong adjusted EBITDA growth in 2011 will contribute
to a 20% - 25% increase in reported free cash flow.
Dividend
As previously announced, Thomson Reuters increased its 2011 annual dividend by
$0.08 per share to $1.24 per share. A quarterly dividend of $0.31 per share is
payable on September 15, 2011 to shareholders of record as of August 18, 2011.
Recent Developments
The company announced on July 21, 2011 that it was streamlining its Markets
division by combining the current Sales & Trading and Investment & Advisory
businesses into one unit to be called "Financial Professionals & Marketplaces"
to focus on services for professionals delivered to screens and trading
marketplaces. The current Enterprise business has also been expanded into
"Enterprise Solutions" to focus on services and infrastructure for financial
firms as a whole. These changes are designed to accelerate growth by simplifying
the business while improving collaboration across the company.
On June 6, 2011, the company announced its intention to divest its Healthcare
business. The Healthcare business provides data, analytics and performance
benchmarking solutions and services to companies, government agencies and
healthcare professionals. The sale process is ongoing and the company expects
the divestiture to close before the end of the year.
Thomson Reuters
Thomson Reuters is the world's leading source of intelligent information for
businesses and professionals. We combine industry expertise with innovative
technology to deliver critical information to leading decision makers in the
financial, legal, tax and accounting, healthcare and science and media markets,
powered by the world's most trusted news organization. With headquarters in New
York and major operations in London and Eagan, Minnesota, Thomson Reuters
employs more than 55,000 people and operates in over 100 countries. Thomson
Reuters shares are listed on the Toronto and New York Stock Exchanges (symbol:
TRI). For more information, go to www.thomsonreuters.com.
NON-IFRS FINANCIAL MEASURES
Thomson Reuters prepares its financial statements in accordance with
International Financial Reporting Standards (IFRS), as issued by the
International Accounting Standards Board (IASB).
This news release includes certain non-IFRS financial measures. Thomson Reuters
uses these non-IFRS financial measures as supplemental indicators of its
operating performance and financial position. These measures do not have any
standardized meanings prescribed by IFRS and therefore are unlikely to be
comparable to the calculation of similar measures used by other companies, and
should not be viewed as alternatives to measures of financial performance
calculated in accordance with IFRS. Non-IFRS financial measures are defined and
reconciled to the most directly comparable IFRS measures in the appended tables.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS, MATERIAL ASSUMPTIONS AND
MATERIAL RISKS
Certain statements in this news release, including, but not limited to,
statements in the "Integration Programs" and "Business Outlook (Before
Currency)" sections and Mr. Glocer's comments, are forward-looking. These
forward-looking statements are based on certain assumptions and reflect our
company's current expectations. As a result, forward-looking statements are
subject to a number of risks and uncertainties that could cause actual results
or events to differ materially from current expectations. There is no assurance
that the events described in any forward-looking statement will materialize. A
business outlook is provided for the purpose of presenting information about
current expectations for 2011. This information may not be appropriate for other
purposes. You are cautioned not to place undue reliance on forward-looking
statements which reflect expectations only as of the date of this news release.
Except as may be required by applicable law, Thomson Reuters disclaims any
obligation to update or revise any forward-looking statements.
The material assumptions underlying the company's 2011 business outlook are
based on various external and internal assumptions. Economic and market
assumptions include, but are not limited to, positive global GDP growth led by
rapidly developing economies and a continued increase in the number of
professionals around the world and their demand for high quality information and
services. Internal financial and operational assumptions include, but are not
limited to, the successful execution of the company's ongoing product release
programs, globalization strategy, other growth initiatives and efficiency
programs.
Some of the material risk factors that could cause actual results or events to
differ materially from those expressed in or implied by forward-looking
statements in this news release include, but are not limited to, changes in the
general economy; actions of competitors; increased accessibility to free or
relatively inexpensive information sources; failure to develop new products,
services, applications and functionalities to meet customers' needs, attract new
customers or expand into new geographic markets; failure to maintain a high
renewal rate for subscription-based services; failures or disruptions of network
systems or the Internet; detrimental reliance on third parties for information
and other services; changes to law and regulations, including the impact of the
Dodd-Frank legislation and similar financial services laws around the world;
failure to meet the challenges involved in operating globally; failure to
protect the reputation of Thomson Reuters; impairment of goodwill and
identifiable intangible assets; inadequate protection of intellectual property
rights; threat of legal actions and claims; downgrading of credit ratings and
adverse conditions in the credit markets; fluctuations in foreign currency
exchange and interest rates; failure to recruit and retain high quality
management and key employees; the effect of factors outside of the control of
Thomson Reuters on funding obligations in respect of pension and post-retirement
benefit arrangements; actions or potential actions that could be taken by the
company's principal shareholder, The Woodbridge Company Limited; failure to
fully derive anticipated benefits from future or existing acquisitions, joint
ventures, investments or dispositions; and failure to achieve benefits from
integration programs to the extent, or within the time period, currently
expected. These and other factors are discussed in materials that Thomson
Reuters from time to time files with, or furnishes to, the Canadian securities
regulatory authorities and the U.S. Securities and Exchange Commission. Thomson
Reuters annual and quarterly reports are also available in the "Investor
Relations" section of www.thomsonreuters.com.
CONTACT
MEDIA INVESTORS
Calvin Mitchell Frank J. Golden
Senior Vice President, Corporate Affairs Senior Vice President, Investor
+1 646 223 5285 Relations
calvin.mitchell(at)thomsonreuters.com +1 646 223 5288
frank.golden(at)thomsonreuters.com
Thomson Reuters will webcast a discussion of its second-quarter 2011 results
today beginning at 8:30 a.m. Eastern Daylight Time (EDT). You can access the
webcast by visiting www.thomsonreuters.com and clicking on "Investor Relations"
at the top of the page and then "Thomson Reuters Reports Second-Quarter 2011
Results." An archive of the webcast will be available in the "Investor
Relations" section of the Thomson Reuters website.
Thomson Reuters Corporation
Division and Business Segment Information
(millions of U.S. dollars)
(unaudited)
Three Months Six Months
Ended Ended
June 30, June 30,
--------------------------------- -------------------------------
2011 2010 Change Organic 2011 2010 Change Organic
Revenues
Legal 11% 3%
[1] $843 $761 11% 3% $1,631 $1,470
Tax & 8% 5%
Accounting
[1] 252 226 12% 7% 508 470
6% 3%
Intellectual
Property &
Science [1] 211 197 7% 2% 412 389
---------------- ----------------
Professional 10% 4%
Division $1,306 1,184 10% 4% 2,551 2,329
Sales & -1% 6% -1%
Trading 940 868 8% 1,867 1,758
-2% 1% -2%
Investment &
Advisory( ) 558 550 1% 1,118 1,109
10% 15% 10%
Enterprise 312 265 18% 608 528
Media 84 79 6% -1% 166 159 4% 0%
---------------- ----------------
Markets 0% 6% 1%
Division 1,894 1,762 7% 3,759 3,554
Eliminations (5) (4) (7) (6)
---------------- ----------------
Revenues from
ongoing
businesses
[2] 3,195 2,942 9% 1% 6,303 5,877 7% 2%
Before
currency 4% 4%
Other
businesses(
)[3] 252 274 474 479
---------------- ----------------
Revenues $3,447 $3,216 7% $6,777 $6,356 7%
Adjusted
EBITDA [4]
Legal( )[1] $314 $287 9% $572 $533 7%
Tax &
Accounting
[1] 72 56 29% 137 113 21%
Intellectual
Property &
Science [1] 71 70 1% 137 134 2%
---------------- ----------------
Professional
Division 457 413 11% 846 780 8%
Markets
Division 532 427 25% 1,003 902 11%
Corporate
expenses (60) (45) (129) (95)
Integration
programs
expenses (42) (90) (112) (187)
---------------- ----------------
Adjusted
EBITDA $887 $705 26% $1,608 $1,400 15%
Underlying
Operating
Profit [5]
Legal [1] $236 $220 7% $422 $402 5%
Tax &
Accounting
[1] 50 35 43% 93 72 29%
Intellectual
Property &
Science [1] 57 56 2% 109 106 3%
---------------- ----------------
Professional
Division 343 311 10% 624 580 8%
Markets
Division 388 312 24% 718 630 14%
Corporate
expenses (62) (50) (137) (107)
---------------- ----------------
Underlying
operating
profit $669 $573 17% $1,205 $1,103 9%
Thomson Reuters Corporation
Reconciliation of Operating Profit to Underlying Operating Profit [5] and
Adjusted EBITDA [4]
(millions of U.S. dollars)
(unaudited)
Three Months Six Months
Ended Ended
June 30, June 30,
-------------------------- -----------------------
2011 2010 Change 2011( ) 2010 Change
Operating profit $833 $435 91% $1,229 $756 63%
Adjustments:
Amortization of
other identifiable
intangible assets 150 132 294 261
Integration
programs expenses 42 90 112 187
Fair value
adjustments (8) (36) (10) (27)
Other operating
(gains) losses, net (286) 34 (319) 33
Operating profit
from Other businesses
[3] (62) (82) (101) (107)
------------------ ----------------------
Underlying operating
profit $669 $573 17% $1,205 $1,103 9%
Adjustments:
Integration programs
expenses (42) (90) (112) (187)
Depreciation and
amortization of computer
software (excluding
Other businesses [3] 260 222 515 484
------------------ ----------------------
Adjusted EBITDA $887 $705 26% $1,608 $1,400 15%
Underlying operating
profit margin 20.9% 19.5% 140bp 19.1% 18.8% 30bp
Adjusted EBITDA margin 27.8% 24.0% 380bp 25.5% 23.8% 170bp
Thomson Reuters Corporation
Reconciliation of Earnings from Continuing Operations to Adjusted EBITDA [4]
(millions of U.S. dollars)
(unaudited)
Three Months Six Months
Ended Ended
June 30, June 30,
--------------------------- ------------------------
2011 2010 Change 2011 2010 Change
Earnings from continuing
operations $572 $303 89% $827 $437 89%
Adjustments:
Tax expense 174 79 226 110
Other finance (income)
cost, net (9) (39) (16) 24
Net interest expense 98 95 199 188
Amortization of other
identifiable intangible
assets 150 132 294 261
Amortization of
computer software 162 133 326 274
Depreciation 110 105 217 243
------------------ ----------------
EBITDA $1,257 $808 56% $2,073 $1,537 35%
Adjustments:
Share of post tax earnings
in equity method investees (2) (3) (7) (3)
Other operating (gains)
losses, net (286) 34 (319) 33
Fair value adjustments (8) (36) (10) (27)
EBITDA from Other businesses
[3] (74) (98) (129) (140)
------------------ ----------------
Adjusted EBITDA $887 $705 26% $1,608 $1,400 15%
Adjusted EBITDA margin 27.8% 24.0% 380bp 25.5% 23.8% 170bp
Thomson Reuters Corporation
Reconciliation of Underlying Operating Profit to Adjusted EBITDA [4] by Division
and Business Segment
(millions of U.S. dollars)
(unaudited)
Three Months Ended Three Months Ended
June 30, 2011 June 30, 2010
----------------------------------- ----------------------------------
Add: Add:
Depreciation Depreciation
and and
Underlying Amortization Underlying Amortization
Operating of Computer Adjusted Operating of Computer Adjusted
Profit Software** EBITDA Profit Software** EBITDA
----------------------------------- ----------------------------------
Legal [1] $236 $78 $314 $220 $67 $287
Tax &
Accounting
[1] 50 22 72 35 21 56
Intellectual
Property &
Science [1] 57 14 71 56 14 70
----------------------------------- ----------------------------------
Professional
Division 343 114 457 311 102 413
Markets
Division 388 144 532 312 115 427
Corporate
expenses (62) 2 (60) (50) 5 (45)
Integration
programs
expenses na na (42) na na (90)
----------------------------------- ----------------------------------
$669 $260 $887 $573 $222 $705
Six Months Ended Six Months Ended
June 30, 2011 June 30, 2010
----------------------------------- ----------------------------------
Add: Add:
Depreciation Depreciation
and and
Underlying Amortization Underlying Amortization
Operating of Computer Adjusted Operating of Computer Adjusted
Profit Software** EBITDA Profit Software** EBITDA
----------------------------------- ----------------------------------
Legal [1] $422 $150 $572 $402 $131 $533
Tax &
Accounting
[1] 93 44 137 72 41 113
Intellectual
Property &
Science [1] 109 28 137 106 28 134
----------------------------------- ----------------------------------
Professional
Division 624 222 846 580 200 780
Markets
Division 718 285 1,003 630 272 902
Corporate
expenses (137) 8 (129) (107) 12 (95)
Integration
programs
expenses na na (112) na na (187)
----------------------------------- ----------------------------------
-------------
** excludes
Other
businesses
[3]
na = not
applicable $1,205 $515 $1,608 $1,103 $484 $1,400
Thomson Reuters Corporation
Reconciliation of Earnings Attributable to Common Shareholders
to Adjusted Earnings from Continuing Operations [6]()
(millions of U.S. dollars, except as otherwise indicated and except for per
share data)
(unaudited)
Three Months Six Months
Ended Ended
June 30, June 30,
------------------ ---------------
2011 2010 2011 2010
Earnings attributable to common shareholders $563 $290 $813 $417
Adjustments:
Operating profit from Other businesses
[3] (62) (82) (101) (107)
Fair value adjustments (8) (36) (10) (27)
Other operating (gains) losses, net (286) 34 (319) 33
Other finance (income) costs (9) (39) (16) 24
Share of post tax earnings in equity (2)
method investees (3) (7) (3)
Tax on above items 115 30 127 29
Interim period effective tax rate 15
normalization [7] 7 5 (11)
Discrete tax item (46) - (46) -
Amortization of other identifiable intangible 150
assets 132 294 261
Discontinued operations - 6 (2) 6
Dividends declared on preference shares (1) - (2) (1)
------------------ ---------------
Adjusted earnings from continuing operations $429 $339 $736 $621
Adjusted earnings per share from continuing $0.51
operations $0.41 $0.88 $0.74
Diluted weighted average common shares (in
millions) 839.8 835.8 839.0 835.3
[1] Thomson Reuters reorganized its reportable segments in the second quarter of
2011. The company's four reportable segments are Legal, Tax & Accounting,
Intellectual Property & Science and Markets. Prior-period amounts have been
reclassified to reflect the current presentation.
[2] Revenues from ongoing businesses are revenues from reportable segments
(which excludes Other businesses (see note (3) below)) less eliminations.
[3] Other businesses are businesses that have been or are expected to be exited
through sale or shut-down that did not qualify for discontinued operations
classification. Other businesses do not qualify as a component of the company's
four reportable segments, nor as a separate reportable segment.
Three Months Six Months
(millions of US. dollars) Ended Ended
June 30, June 30,
------------------ ---------------
Other businesses 2011 2010 2011 2010
Revenues $252 $274 $474 $479
Operating profit $62 $82 $101 $107
Depreciation and amortization of computer
software 12 16 28 33
------------------ ---------------
EBITDA $74 $98 $129 $140
[4] Thomson Reuters defines adjusted EBITDA as underlying operating profit
excluding the related depreciation and amortization of computer software but
including integration programs expense. Adjusted EBITDA margin is adjusted
EBITDA expressed as a percentage of revenues from ongoing businesses.
[5] Underlying operating profit is operating profit from reportable segments and
corporate expenses. Underlying operating profit margin is the underlying
operating profit expressed as a percentage of revenues from ongoing businesses.
[6] Adjusted earnings from continuing operations and adjusted earnings per share
from continuing operations include dividends declared on preference shares and
integration programs expense, but exclude the pre-tax impacts of amortization of
other identifiable intangible assets as well as the post-tax impacts of fair
value adjustments, other operating gains and losses, certain impairment charges,
the results of Other businesses (see note (3) above), other net finance (income)
costs, Thomson Reuters share of post-tax (earnings) losses in equity method
investees, discontinued operations and other items affecting comparability.
Adjusted earnings per share from continuing operations is calculated using
diluted weighted average shares and does not represent actual earnings per share
attributable to shareholders.
[7] Adjustment to reflect income taxes based on estimated full-year effective
tax rate. Reported earnings for interim periods reflect income taxes based on
the estimated effective tax rates of each of the jurisdictions in which Thomson
Reuters operates. The adjustment reallocates estimated full-year income taxes
between interim periods, but has no effect on full year income taxes.
Thomson Reuters Corporation
Consolidated Income Statement
(millions of U.S. dollars, except per share data)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------- ----------------------------
2011 2010 2011 2010
Revenues $3,447 $3,216 $6,777 $6,356
Operating expenses (2,478) (2,377) (5,030) (4,789)
Depreciation (110) (105) (217) (243)
Amortization of computer
software (162) (133) (326) (274)
Amortization of other
identifiable intangible
assets (150) (132) (294) (261)
Other operating gains
(losses), net 286 (34) 319 (33)
--------------------------- ----------------------------
Operating profit 833 435 1,229 756
Finance costs, net:
Net interest
expense (98) (95) (199) (188)
Other finance
income (costs) 9 39 16 (24)
--------------------------- ----------------------------
Income before tax and
equity method investees 744 379 1,046 544
Share of post tax
earnings in equity
method investees 2 3 7 3
Tax expense (174) (79) (226) (110)
--------------------------- ----------------------------
Earnings from continuing
operations 572 303 827 437
(Losses) earnings from
discontinued operations,
net of tax - (6) 2 (6)
--------------------------- ----------------------------
Net earnings $572 $297 $829 $431
Earnings attributable
to:
Common shareholders 563 290 813 417
Non-controlling
interests 9 7 16 14
Basic and diluted
earnings per share $0.67 $0.35 $0.97 $0.50
Basic weighted average
common shares 837,096,717 831,962,410 836,129,383 831,429,258
Diluted weighted average
common shares 839,846,235 835,827,289 839,025,585 835,335,292
Thomson Reuters Corporation
Consolidated Statement of Financial Position
(millions of U.S. dollars)
(unaudited)
June 30, December 31,
2011 2010
Assets
Cash and cash equivalents $713 $864
Trade and other receivables 1,653 1,809
Other financial assets 97 74
Prepaid expenses and other current assets 662 912
Current assets excluding assets held for sale 3,125 3,659
Assets held for sale 1,144 -
Current assets 4,269 3,659
Computer hardware and other property, net 1,464 1,567
Computer software, net 1,573 1,613
Other identifiable intangible assets, net 8,620 8,714
Goodwill 18,906 18,892
Other financial assets 524 460
Other non-current assets 567 558
Deferred tax 61 68
Total assets $35,984 $35,531
Liabilities and equity
Liabilities
Current indebtedness $634 $645
Payables, accruals and provisions 2,502 2,924
Deferred revenue 1,223 1,300
Other financial liabilities 117 142
Current liabilities excluding liabilities associated
with assets held for sale 4,476 5,011
Liabilities associated with assets held for sale 219 -
Current liabilities 4,695 5,011
Long-term indebtedness 6,955 6,873
Provisions and other non-current liabilities 2,207 2,217
Other financial liabilities 24 71
Deferred tax 1,600 1,684
Total liabilities 15,481 15,856
Equity
Capital 10,407 10,284
Retained earnings 10,808 10,518
Accumulated other comprehensive loss (1,062) (1,480)
Total shareholders' equity 20,153 19,322
Non-controlling interests 350 353
Total equity 20,503 19,675
Total liabilities and equity $35,984 $35,531
Thomson Reuters Corporation
Consolidated Statement of Cash Flow
(millions of U.S. dollars)
(unaudited)
Three Months Six Months
Ended Ended
June 30, June 30,
----------------------------------
2011 2010 2011 2010
Cash provided by (used in):
Operating activities
Net earnings $572 $297 $829 $431
Adjustments for:
Depreciation 110 105 217 243
Amortization of computer software 162 133 326 274
Amortization of other identifiable
intangible assets 150 132 294 261
Deferred tax (142) (28) (174) (66)
Other (253) 82 (222) 224
Changes in working capital and other items [1] 280 168 (191) (168)
----------------------------------
Operating cash flows from continuing
operations 879 889 1,079 1,199
Operating cash flows from discontinued
operations - - - (6)
----------------------------------
Net cash provided by operating activities [1] 879 889 1,079 1,193
----------------------------------
Investing activities
Acquisitions, less cash acquired (672) (415) (726) (478)
Proceeds from other disposals 495 4 510 18
Capital expenditures, less proceeds from
disposals [1] (247) (249) (541) (558)
Other investing activities 2 4 37 3
----------------------------------
Investing cash flows from continuing
operations (422) (656) (720) (1,015)
Investing cash flows from discontinued
operations 18 - 39 -
----------------------------------
Net cash used in investing activities [1] (404) (656) (681) (1,015)
----------------------------------
Financing activities
Proceeds from debt - 147 - 638
Repayments of debt (48) (442) (53) (913)
Net repayments under short-term loan
facilities (63) (14) (20) (14)
Dividends paid on preference shares (1) - (2) (1)
Dividends paid on common shares (248) (232) (465) (463)
Other financing activities (14) - (14) (6)
----------------------------------
Net cash used in financing activities (374) (541) (554) (759)
----------------------------------
Translation adjustments on cash and cash
equivalents 1 (12) 5 (22)
----------------------------------
Increase (decrease) in cash and cash
equivalents 102 (320) (151) (603)
Cash and cash equivalents at beginning of
period 611 828 864 1,111
----------------------------------
Cash and cash equivalents at end of period $713 $508 $713 $508
[1] Certain prior-period amounts have been revised in the consolidated statement
of cash flow. Specifically, capital expenditures now include only cash payments,
whereas previously they also included accruals relating to capital expenditures.
The revision had no impact on prior periods' increase or decrease in cash and
cash equivalents, financial position or results of operations.
Capital expenditures including accrued amounts were $233 million and $248
million for the three months ended June 30, 2011 and 2010, respectively, and
$451 million and $462 million for the six months ended June 30, 2011 and 2010,
respectively.
Thomson Reuters Corporation
Reconciliation of Net Cash Provided by Operating Activities
to Underlying Free Cash Flow( )[1],[2]
(millions of U.S. dollars)
(unaudited)
Three Months Six Months
Ended Ended
June 30, June 30,
--------------------------------
2011 2010 2011 2010
Net cash provided by operating activities [3] $879 $889 $1,079 $1,193
Capital expenditures, less proceeds from
disposals [3] (247) (249) (541) (558)
Other investing activities 2 4 37 3
Dividends paid on preference shares (1) - (2) (1)
--------------------------------
Free cash flow [2],[3] 633 644 573 637
Integration programs costs 67 107 140 221
--------------------------------
Underlying free cash flow [1],[3] $700 $751 $713 $858
[1] Underlying free cash flow is free cash flow excluding one-time cash costs
associated with integration programs.
[2] Free cash flow is net cash provided by operating activities less capital
expenditures, other investing activities and dividends paid on our preference
shares. Thomson Reuters uses free cash flow as a performance measure because it
represents cash available to repay debt, pay dividends and fund share
repurchases and new acquisitions.
[3] There was no impact on free cash flow or underlying free cash flow as a
result of the revision of prior-period amounts for "net cash provided by
operating activities" and "capital expenditures, less proceeds from disposals."
See the "Consolidated Statement of Cash Flow" in this news release for
additional information.
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Thomson Reuters Corporation via Thomson Reuters ONE
[HUG#1534144]
Unternehmensinformation / Kurzprofil:
Datum: 28.07.2011 - 13:02 Uhr
Sprache: Deutsch
News-ID 56801
Anzahl Zeichen: 64950
contact information:
Kategorie:
Business News
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