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Thomson Reuters Beats Profit Estimates on Subscription Sales

Thomson Reuters Corp. (TRI), the provider of financial news and information, reported profit that beat analysts’ estimates after subscription revenue helped make up for a decrease in sales from trading transactions.

Excluding some items, third-quarter profit was 54 cents a share, the company said today in a statement. Analysts had estimated 48 cents on average, according to data compiled by Bloomberg. Total revenue slid 6.9 percent to $3.22 billion.

“Third-quarter results met our expectations even as the market environment remained challenging,” James C. Smith, Thomson Reuters’s chief executive officer, said in the statement. “Our resilient subscription-based businesses performed well.”

The New York-based company, controlled by Chairman David Thomson through a family investment trust, continued to see improvements in its tax and legal business during a slump in sales of financial-data products. The slowdown in the U.S. and Europe has prompted many Wall Street firms to cut costs, resulting in sluggish sales.

The shares fell 1.1 percent to $28.20 at the close in New York. The stock has gained 5.7 percent this year.

Reiterates Forecast

Third-quarter net income attributable to common shareholders climbed 25 percent to $462 million, or 56 cents a share, from $369 million, or 44 cents, a year earlier. The company also reaffirmed its 2012 forecast for revenue growth in the low single digits.

Thomson Reuters has focused on expanding newer businesses, including legal, tax and foreign-exchange services. Legal revenue rose 1 percent to $830 million in the period, while the tax and accounting business posted an 8 percent gain to $262 million.

Thomson Reuters also has shed some operations. It agreed to sell a health-care division to Veritas Capital for $1.25 billion in April and offloaded a smaller property-tax unit for an undisclosed sum in September. Revenue from ongoing businesses, when adjusting for currency fluctuations, rose 1 percent last quarter.

The company acquired FX Alliance Inc. in July for about $620 million, gaining access to more than 1,300 clients that use the platform to access foreign-exchange markets.

Bloomberg LP, the parent of Bloomberg News, competes with Thomson Reuters in selling financial and legal information and trading systems.

To contact the reporter on this story: Edmund Lee in New York at elee310@bloomberg.net

To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net

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