Reuters profit drops 8pc as contracts cut
Thomson Reuters saw its quarterly profit slide eight per cent despite arresting its free-falling revenue.
Underlying operating profit fell 17 per cent to $655m (£419m) as the firm struggled to bounce back from the hammering it suffered in the wake of the financial meltdown. The firm was hit by a glut of cancelled contracts as businesses stripped back their spending. Adjusted earnings per share fell to 47 cents from 58 cents a year earlier.
Revenue from ongoing businesses fell two per cent to $3.22bn but the firm expects to see a return to revenue growth in the third quarter.
Chief executive Thomas Glocer said: “Net sales have been positive for the firm as a whole for three quarters, and increasingly positive toward the end of the second quarter.”
He added: “Sales have been encouraging enough that we think we actually will turn positive before the fourth quarter.”
The firm’s markets division, which serves the financial industry, saw revenue fell four per cent from the same quarter a year earlier. Revenue from the division was up from the first quarter.
Revenue rose two per cent in the professional division, which sells databases and other information reservoirs to lawyers, accountants, scientists and healthcare workers.
The Reuters news agency business reported a three per cent fall in revenue, but net sales turned positive after it won a contract with Time Warner’s CNN cable news network.
Thomson Reuters said sales of WestlawNext, a new version of the company’s Westlaw deep information database for lawyers, were well ahead of expectations, with about 5,700 customers buying the product since launch in February.