Earnings: Thomson Reuters Q4 Held Up, Media Sales Dipped; More Savings Found
This story was written by Robert Andrews.
Thomson Reuters (NSDQ: TRIN) recorded 3.4 billion Q4 revenue - five percent higher than the year ago without factoring currency fluctuations, but growth was flat if fluctuations are factored in. CEO Tom Glocer: "We have been able to accelerate the Reuters integration, significantly increase the savings we expect to achieve, and reach our goal of becoming 'one company in one year' ... We are beginning to benefit from the advantages of increased scale. As major economies slid into recession in 2008, we nonetheless continued to perform well."
The Markets division selling data to financial clients got four percent higher revenue at $1.9 billion (down two percent accounting for currency) amid "extreme volatility in the financial sector", but growth was led by the EMEA region while Americas dipped one percent. Despite Glocer's confidence across the group, the Media unit did suffer in the downturn - revenues down five percent to $106 million (down 11 percent accounting for currency fluctuation), thanks to "modest weakness in the Agency business and marked slowdowns in the advertising-driven Consumer and Professional Publishing segments"
The Professional division scored six percent better sales of $1.5 billion (up three percent accounting for currency), thanks to 10 percent better online, software and services sales, which more than offset a one percent fall in print and CD revenue. Here, the Legal, Scientific and Healthcare units all posted single-digit revenue gains, including strong growth in overseas sales of online legal services, Web Of Science subscriptions and the Payer business. Thomson Reuters also published FY08 results - eight percent better revenue of $13.4 billion, with no impact from currency fluctuation.
The company found an extra $250 million in merger-related savings down the back of its sofa. Though on completing the merger in May, it projected $750 million savings by 2011, it today said "significant additional opportunities for cost savings" identified since then meant annualized savings by that date will now be $1 billion - in fact, a total $1.4 billion when you include "legacy efficiency programs". The nature of new savings wasn't revealed; it's now beginning a "second phase" of integration. The outlook - Glocer: "Based on the current environment in the markets we serve, we expect our revenues to grow in 2009." No detail given on the extent of 2009 growth.
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By Robert Andrews