Exhibit 99.1

AMENDED MANAGEMENT’S DISCUSSION AND ANALYSIS

EXPLANATORY NOTE

This amended management’s discussion and analysis for the three months ended March 31, 2009 reflects our adoption of International Financial Reporting Standards as issued by the International Accounting Standards Board (IFRS). We originally filed our management’s discussion and analysis for the three months ended March 31, 2009 on May 8, 2009.  That discussion and analysis was based on our financial statements prepared in accordance with generally accepted accounting principles in Canada (Canadian GAAP). This amended management’s discussion and analysis continues to describe conditions, trends, results and outlook as of May 6, 2009, which was the date of our original management’s discussion and analysis. Except for changes related to our adoption of IFRS, we have not reflected events occurring after May 6, 2009, nor have we modified or updated the discussion and analysis from our original filing. This amended management’s discussion and analysis supersedes our original filing.

GENERAL

This amended management’s discussion and analysis is designed to provide you with a narrative explanation of our financial condition and results of operations through the eyes of our management.  We recommend that you read this in conjunction with our amended consolidated financial statements for the three months ended March 31, 2009 and our consolidated financial statements for the year ended December 31, 2008, the related notes to those financial statements, and our management’s discussion and analysis for the year ended December 31, 2008.  References in this discussion to “$” and “US$” are to U.S. dollars, references to “C$” are to Canadian dollars and references to “£” are to British pounds sterling. References to our “2008 annual report” are to Thomson Reuters Corporation’s annual information form and annual report on Form 40-F for the year ended December 31, 2008, which information was also included in Thomson Reuters PLC annual report on Form 20-F for the year ended December 31, 2008. Unless otherwise indicated or the context otherwise requires, references in this discussion to “we,” “our,” “us” and “Thomson Reuters” are to Thomson Reuters Corporation, Thomson Reuters PLC and their respective subsidiaries which operate as a unified group under a dual listed company (DLC) structure. References to “Reuters” are to Reuters Group PLC, which we acquired on April 17, 2008. In order to provide comparable information to our 2009 results, we have included 2008 pro forma financial information in the section entitled “Results of Operations”. This amended management's discussion and analysis also contains forward-looking statements which reflect management’s views as of May 6, 2009. Readers are cautioned that these forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements. Some of these factors include those identified in the section entitled “Cautionary Note Concerning Factors That May Affect Future Results”.

ADOPTION OF IFRS

In 2008, the Canadian Accounting Standards Board stated that Canadian publicly accountable enterprises will be required to adopt IFRS by 2011 to replace Canadian GAAP. The Canadian securities regulatory authorities approved our application to early adopt IFRS in 2009.

The accompanying amended interim financial statements for the three months ended March 31, 2009 have been restated to reflect our adoption of IFRS, with effect from January 1, 2008. Periods prior to January 1, 2008 have not been restated. Our financial statements subsequent to this report will be prepared in accordance with IFRS.

Note 27 of our amended interim financial statements for the three months ended March 31, 2009 contains a detailed description of our conversion to IFRS, including a line-by-line reconciliation of our financial statements previously prepared under Canadian GAAP to those under IFRS for the three months ended March 31, 2009 and 2008 and for the year ended December 31, 2008. Appendix A of this amended management’s discussion and analysis provides a line-by-line reconciliation of our income statements for the six months ended June 30, 2008 and the nine months ended September 30, 2008 previously prepared under Canadian GAAP to those under IFRS. Appendix B of this amended management’s discussion and analysis provides a reconciliation of our 2008 pro forma financial information previously prepared under Canadian GAAP to that under IFRS.

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OVERVIEW

Our Business and Strategy

Who we are and what we do – We are the leading source of intelligent information for the world’s businesses and professionals, providing customers with a competitive advantage. Intelligent information is a unique synthesis of human intelligence, industry expertise and innovative technology that provides decision-makers with the knowledge to act, enabling them to make better decisions faster. Through more than 50,000 people across 93 countries, we deliver this must-have insight to the financial, legal, tax and accounting, healthcare and science and media markets, powered by the world’s most trusted news organization.

April 17, 2009 marked the one-year anniversary of our acquisition of Reuters for approximately $16 billion. As a result of this transaction, we are a much larger and more global company. See the section entitled “Acquisition of Reuters” for additional information regarding the calculation of the Reuters purchase consideration under IFRS, which differs from the previously reported amount under Canadian GAAP.

How we make money – We serve a wide variety of customers with a single, tested business model. We derive the majority of our revenues from selling electronic content and services to professionals, primarily on a subscription basis. Over the years, this has proven to be capital efficient and cash flow generative, and it has enabled us to maintain leading and scalable positions in our chosen markets.  Within each of the markets we serve, we bring in-depth understanding of our customers’ needs, flexible technology platforms, proprietary content and scale. We believe our ability to embed our solutions into customers’ workflows is a significant competitive advantage as it leads to strong customer retention.

Our operational structure — We are organized in two divisions:

· Markets, which consists of our financial and media businesses;and

· Professional, which consists of our legal, tax and accounting, and healthcare and science businesses.

In the first quarter of 2009, we reorganized certain parts of our Professional division to reflect the global nature of our business, focus on key growth opportunities and increase efficiency.

· We created an intellectual property (IP) business, which became part of the Legal segment, by combining all of our Professional division-wide assets and capabilities related to patents, trademarks and standards.

· We created a new strategic business unit, Healthcare & Science, which manages the previously separate Healthcare and Scientific segments.

· We reorganized the Legal and Tax & Accounting businesses on a global basis to facilitate the creation of more international solutions for our customers and to follow the expansion of our customers around the world.

We have restated our first quarter 2008 segment results to be comparable to our 2009 presentation.

We also report a Corporate and Other category that principally includes corporate expenses, certain share-based compensation costs, certain fair value adjustments and integration program costs. In 2008, this category also included transaction costs associated with the Reuters acquisition.

Our business environment – We are a global business and many of our customers have operations around the world. This is an important element of our growth strategy. We operate in 93 countries and, accordingly, we need to ensure our offerings reflect the global economy, our brand has international appeal, and our global footprint allows us to capitalize on new opportunities such as the growth of professional workers in emerging economies and the expansion of our existing customers into new geographic areas.

As a global organization, we are affected by economic and market dynamics, governmental regulations and business conditions of each market and country in which we operate. Despite the continuing decline in the global economy and deep disruption in the financial markets, our revenues continued to grow organically in the first quarter of 2009, albeit at a slower rate than 2008.  We believe our ability to grow in this challenging market environment demonstrated the strength of our business model, the choice of markets in which we operate and our focus on executing our strategic priorities during our first year as Thomson Reuters.  Given the subscription nature of our business and the visibility that affords us, we recently reaffirmed our full-year 2009 outlook, which is discussed in the “Outlook” section of this amended management’s discussion and analysis.

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As expected, our Markets division experienced difficult conditions in the first quarter of 2009 as our customers continued to be negatively impacted by the global recession and severe disruptions in the financial markets. The difficulties experienced by our sell-side customers are now flowing through to the buy-side, as global assets under management declined over 40% in 2008 and firms restructure their organizations. While the Markets division’s recurring revenues increased 2% in the first quarter of 2009, traditionally volatile transactional revenues declined 12%.The impact of these challenging conditions on the division was mitigated by its geographic, markets and product diversity. Revenues from Asia and from Europe, the Middle East and Africa (EMEA) increased 5% and 3%, respectively, while revenues from the Americas declined 4%. Results for the Enterprise and Investment & Advisory segments reflected organic revenue growth driven by demand for data feeds and our Corporate and Wealth Management services, respectively.  In the Sales & Trading segment, a decrease in Foreign Exchange revenues resulting from lower transactions and decline in desktop subscriptions were partially offset as Commodities & Energy and Tradeweb continued to perform well. Net new sales (gross sales minus cancellations) for the division decreased in the quarter. In this environment, we continue to work closely with our customers to help them create transparency, automate processes and manage risk.

Our Professional division businesses have historically been more resilient to economic cycles, though we are not immune to the overall economic environment. Our balanced portfolio and leading franchise positions enabled us to continue to grow revenues in these conditions.  The division’s online, software and services offerings, which comprised 80% of its ongoing revenues, increased 4% in the first quarter of 2009, but was offset by the performance of its print-based offerings, for which the revenues were consistent with that of the prior year period. The legal market experienced a decline in activity and law firm billings are expected to be lower in 2009. While our Legal business had increased revenues in its core Westlaw, client development and international offerings, it experienced slower growth due to a decline in revenues from ancillary and other services. Revenues from our Tax & Accounting and Healthcare & Science businesses continued to increase as these markets continue to grow and demand our offerings. In this environment, we are continuing to invest in and grow our core businesses to gain additional customers while also tightly managing costs to drive profitability.

In the first quarter of 2009, the U.S. dollar strengthened against other major currencies, such as the British pound and Euro, compared to the first quarter of 2008.  This strengthening negatively impacted the amount of revenues we reported in U.S. dollars, but had a positive effect on operating profit margins.

Our 2009 priorities – Our priorities for 2009 are to:

· Integrate Thomson and Reuters businesses to drive long-term growth and capture synergies;

· Capitalize on a global brand and presence to drive international growth; and

· Achieve scale economics and make the whole of Thomson Reuters greater than the sum of its parts.

Our corporate structure – We operate under a DLC structure with shareholders in two publicly listed entities:

· Thomson Reuters Corporation, an Ontario, Canada corporation; and

· Thomson Reuters PLC, a public limited company registered in England and Wales.

We operate as a unified group pursuant to contractual arrangements as well as provisions in our organizational documents. Under our DLC structure, one Thomson Reuters PLC ordinary share currently has equivalent rights to distributions of income and capital and voting rights as one Thomson Reuters Corporation common share.

Our controlling shareholder is The Woodbridge Company Limited. As of May 6, 2009, The Woodbridge Company Limited and other companies affiliated with it (Woodbridge) had a voting interest in Thomson Reuters of approximately 55% based on the aggregate issued share capital of Thomson Reuters Corporation and Thomson Reuters PLC. See the section entitled “Related Party Transactions” for additional information about our recent transactions with Woodbridge.

Our financial statements — Our primary financial statements are the consolidated financial statements of Thomson Reuters Corporation. These statements account for Thomson Reuters PLC as a subsidiary and have been prepared in accordance with IFRS, commencing with the accompanying amended interim financial statements for the three months ended March 31, 2009.

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Results for Reuters are included in our consolidated financial statements beginning April 17, 2008. For informational purposes, we have also included Thomson Reuters results for 2008 on a pro forma basis in this amended management’s discussion and analysis, which present the hypothetical performance of our business as if Thomson had acquired Reuters on January 1, 2007. See the sections of this amended management’s discussion and analysis entitled “Acquisition of Reuters” and “Results of Operations” for more information.

Seasonality

Prior to the acquisition of Reuters, our revenues and operating profits from continuing operations were proportionately the smallest in the first quarter and the largest in the fourth quarter, as certain product releases were concentrated at the end of the year, particularly in the regulatory and healthcare markets. Costs were incurred more evenly throughout the year. Our operating margins historically increased as the year progressed.  For these reasons, performance was not comparable quarter to consecutive quarter and was best considered on the basis of results for the whole year or by comparing results in a quarter with the results in the same quarter for the previous year. As Reuters revenues and profits have not historically fluctuated as significantly throughout the year, the seasonality of our revenues and operating profits is now less pronounced. However, performance remains not comparable quarter to consecutive quarter and is best considered on the basis of results for the whole year or by comparing results in a quarter with the results in the same quarter for the previous year.

Acquisition of Reuters

On April 17, 2008, we acquired Reuters for approximately $16 billion. We combined the operations of Reuters with the former Thomson Financial segment to create a global leader in electronic information services, trading systems and news.

The components of the purchase consideration were as follows:

(millions of U.S. dollars)
Cash (paid on May 1, 2008)	8,450
Thomson Reuters PLC ordinary shares (194,107,278 issued on April 17, 2008)	7,266
Reuters Group PLC options	176
Transaction costs	138
Total purchase consideration	16,030

We previously reported the purchase consideration under Canadian GAAP as approximately $17 billion.  For a description of the purchase consideration difference between IFRS and Canadian GAAP, see note 27 to our amended interim financial statements for the three months ended March 31, 2009.

In allocating the purchase price, we recorded approximately $12.5 billion of goodwill, approximately $6.6 billion of identifiable intangible assets, $532 million of computer software relating to acquired developed technology and approximately $3.6 billion of other net liabilities assumed.  For additional details on the acquisition of Reuters, see note 6 to our amended interim financial statements for the three months ended March 31, 2009.

Integration Program

In 2009, we are focused on the second phase of the acquisition integration, which includes:

· Retiring legacy products and systems;

· Consolidating data centers;

· Rolling out new strategic products; and

· Capturing revenue synergies.

These efforts are expected to simplify our operations, generate costs savings and support long-term revenue growth.

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The table below summarizes the run-rate savings we have achieved and the savings targets (including legacy efficiency programs) we expect to achieve by the end of 2009 and by program completion in 2011.  We also include the actual and projected costs to achieve these savings.

	Three months ended March 31,			Year ended December 31,
(millions of U.S dollars)		2008 Actual	2009 Actual		2008 Actual	2009 Target	Total Program Target (by 2011)
Run-Rate Savings		300	850		750	975	1,420
Costs		13	88		468*	500	1,300*

* 2008 and total program costs exclude $68 million of transaction-related expenses.

Our projected total program costs recognized in the income statement under IFRS increased $125 million to $1.3 billion compared to the amount included in our original first quarter 2009 report under Canadian GAAP.  This difference arises because certain costs which were capitalized under Canadian GAAP are expensed under IFRS. The amount is comprised of $106 million for severance costs incurred in 2008 and $19 million for real estate exit costs expected to be incurred in 2010. Our 2009 and total program run-rate savings targets are unchanged.

Costs associated with these efforts primarily include severance and consulting expenses as well as costs associated with certain technology initiatives and branding. Because these are corporate initiatives, integration program expenses are reported within the Corporate and Other segment.

Use of Non-GAAP and Pro Forma Financial Measures

In addition to our results reported in accordance with IFRS, we use certain other non-GAAP financial measures as supplemental indicators of our operating performance and financial position and for internal planning purposes. We have historically reported non-GAAP financial results as we believe their use provides more insight into our performance.

As the Reuters acquisition closed on April 17, 2008, our 2009 results include the impact of the acquisition for the entire period, whereas 2008 only includes results from the closing date.  Due to the significant impact of the Reuters acquisition on our results, we also include 2008 results on a pro forma basis to reflect the acquisition from the beginning of the period. This provides a more meaningful comparison of our performance in 2009 to 2008.  Pro forma results do not reflect the actual results of our business.

The following is a description of our non-GAAP financial measures, including an explanation of why we believe they are useful measures of our performance, including our ability to generate cash flow.

· Revenues and operating profit from ongoing businesses.  We believe our revenues and operating profit are best measured based on our ability to grow our ongoing businesses over the long term. Accordingly, we evaluate our revenue and operating profit excluding results from disposals, which are defined as businesses sold or held for sale that do not qualify for discontinued operations classification.

· Underlying operating profit and underlying operating profit margin.  We adjust our operating profit to exclude amortization of other intangible assets, impairment charges, fair value adjustments, integration program costs, other operating gains and losses and the results of disposals.  We refer to this measure as underlying operating profit. Our underlying operating profit margin is underlying operating profit expressed as a percentage of revenues from ongoing businesses. We use these measures to assist in comparisons from one period to another as they provide a useful basis to evaluate operating profitability and performance trends by removing the impact of items which distort the performance of our operations.  See the reconciliation of underlying operating profit to the most directly comparable IFRS measure in the “Results of Operations” section of this amended management’s discussion and analysis.

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· Adjusted earnings and adjusted earnings per share from continuing operations. We measure our earnings attributable to common and ordinary shareholders and per share before the pre-tax impacts of amortization of other intangible assets.  We further adjust these measures for the post-tax impacts of fair value adjustments, other operating gains and losses, impairment charges, the results of disposals, other finance costs, our share of post-tax earnings in equity method investees and discontinued operations. We also deduct dividends declared on preference shares. We refer to these amounts as adjusted earnings from continuing operations and adjusted earnings per share from continuing operations. We use these measures to assist in comparisons from one period to another.  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.  

In interim periods, we adjust our reported earnings and earnings per share to reflect a normalized effective tax rate.  Specifically, the normalized effective rate is computed as the estimated full-year effective tax rate applied to the consolidated pre-tax income of the interim period. The reported effective tax rate is based on separate annual effective income tax rates for each taxing jurisdiction that are applied to each interim period’s pre-tax income. Because the seasonality of certain of our businesses affects our geographical mix of profits in interim periods and therefore distorts the reported effective tax rate, we believe that using the expected full-year effective tax rate provides a more meaningful comparison among interim periods. The adjustment to normalize the effective tax rate reallocates estimated full-year income taxes between interim periods, but has no effect on full year tax expense or on cash taxes paid.

See the reconciliation of adjusted earnings from continuing operations to the most directly comparable IFRS measure in the “Results of Operations” section of this amended management’s discussion and analysis.

· Net debt.  We define our net debt as our total indebtedness, including associated fair value hedging instruments (swaps) on our debt, but excluding unamortized transaction costs and premiums or discounts associated with our debt, less cash and cash equivalents. Given that we hedge some of our debt to reduce risk, we include hedging instruments as we believe it provides a better measure of the total obligation associated with our outstanding debt. However, because we intend to hold our debt and related hedges to maturity, we do not consider certain components of the associated fair value of hedges in our measurements. We reduce gross indebtedness by cash and cash equivalents on the basis that they could be used to pay down debt. See the reconciliation of this measure to the most directly comparable IFRS measure in the “Liquidity and Capital Resources” section of this amended management’s discussion and analysis.

· Free cash flow.  We evaluate our operating performance based on free cash flow, which we define as net cash provided by operating activities less capital expenditures, other investing activities, investing activities of discontinued operations and dividends paid on our preference shares. We use free cash flow as a performance measure because it represents cash available to repay debt, pay common and ordinary dividends and fund share repurchases and new acquisitions. See the reconciliation of this measure to the most directly comparable IFRS measure in the “Liquidity and Capital Resources” section of this amended management’s discussion and analysis.

Non-GAAP measures do not have any standardized meaning prescribed by IFRS and, therefore, are unlikely to be comparable with the calculation of similar measures used by other companies. You should not view these measures as alternatives to measures of financial performance calculated in accordance with IFRS.

RESULTS OF OPERATIONS

Basis of Presentation

We discuss our results from continuing operations as presented in our income statement.  Our results from continuing operations include the performance of acquired businesses from the date of their purchase and exclude results from businesses classified as discontinued operations.  In order to compare the performance of our ongoing businesses, the effects of businesses that could not be classified as discontinued operations have been removed.  Therefore, our results from ongoing businesses exclude discontinued operations and other businesses sold or held for sale.  In analyzing our revenues, we measure the performance of existing businesses, the impact of acquired businesses and of foreign currency.

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Consolidated Results – 2009 IFRS Basis Compared to 2008 Pro Forma Basis

The following table summarizes selected financial information:

(unaudited)	Three months ended March 31,
			2009			2008(1)
Revenues			3,131			3,260
Operating profit			376			464
Revenues from ongoing businesses			3,127			3,233
Underlying operating profit			590			589
Underlying operating profit margin			18.9	%		18.2	%
Adjusted earnings from continuing operations			335			375
Adjusted earnings per share from continuing operations		$	0.40		$	0.45

(1) Represents pro forma results.

We compare our first quarter 2009 results of operations to 2008 pro forma financial information because the period-to-period comparison of our IFRS results did not allow for a sufficient understanding of the underlying trends of our business due to the timing of the closing of the Reuters acquisition and certain special items.  Because our 2008 pro forma results include the effects of the Reuters acquisition from the beginning of the period, we believe they provide a more meaningful basis of comparison against our 2009 performance.  Our 2008 pro forma information:

· was not audited;

· was prepared on a basis as though the acquisition closed on January 1, 2007 and is for informational purposes only, and because of its nature, addresses a hypothetical situation and, therefore, does not represent our actual results;

· contained adjustments based on information current as of our management’s discussion and analysis for the year ended December 31, 2008;

· was calculated in a manner consistent with the preparation of the unaudited pro forma information included in Appendix A of our management’s discussion and analysis for the year ended December 31, 2008, except for our adoption of IFRS; and

· was not adjusted to reflect any matters not directly attributable to the acquisition.  No adjustment, therefore, was made to periods prior to the closing date (April 17, 2008) for actions which have or may be taken upon completion of the acquisition, such as any of our integration plans.  SeeAppendix B of this amended management’s discussion and analysis for further discussion and the calculation of the pro forma results.

Revenues. The following table provides information about our revenues from ongoing businesses:

	Three months ended March 31,			Percentage change due to:
(millions of U.S. dollars)		2009	2008(1)		Existing    businesses		Acquired   businesses		Foreign  currency		Total
Revenues from ongoing businesses		3,127	3,233		2	%	1	%	(6	%)	(3	%)

(1) Represents pro forma results.

Revenues from ongoing businesses decreased 3%.  Excluding the effects of foreign currency, these revenues increased 3% reflecting the following:

· The breadth of our offerings and diverse customer base;

· Higher growth rate businesses such as Enterprise in Markets, FindLaw in Legal, payer decision support in Healthcare & Science and core products in Tax & Accounting more than offsetting decreases from other businesses that have been more sensitive to the economic cycle; and

· Revenues from acquired businesses included our December 31, 2008 acquisition of Paisley, a provider of governance, risk and compliance solutions in our Tax & Accounting segment, and other tactical acquisitions.

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Operating profit.  The following table provides information about our operating profit, including a reconciliation to underlying operating profit:

	Three months ended March 31,
		2009		2008(1)
Operating profit		376		464
Adjustments:
Amortization of other intangible assets		119		129
Disposals		6		3
Fair value adjustments		1		(20	)
Integration program costs		88		13
Underlying operating profit		590		589
Underlying operating profit margin		18.9	%	18.2	%

(1) Represents pro forma results.

Operating profit decreased $88 million, or 19%, compared to the prior year period primarily due to increased integration program costs. Underlying operating profit was comparable to the prior year and the corresponding margin increased 70 basis points to 18.9% primarily due to benefits from foreign currency, as well as the impact of integration-related savings and cost control efforts across our businesses, slightly offset by higher pension and share-based compensation expenses.

Adjusted earnings and adjusted earnings per share from continuing operations. The table below presents our adjusted earnings calculation for the three months ended March 31, 2009 compared to our pro forma adjusted earnings for the comparable 2008 period.

	Three months ended March 31,
(millions of U.S. dollars, except per share amounts)		2009				2008
Earnings attributable to common and ordinary shareholders			190
Adjustments:
Disposals			6
Fair value adjustments			1
Other finance costs			23
Share of post-tax earnings in equity method investees			(1	)
Tax on above			(5	)
Interim period effective tax rate normalization			7
Amortization of other intangible assets			119
Discontinued operations			(4	)
Dividends declared on preference shares			(1	)
Adjusted earnings from continuing operations			335			375(	1)
Adjusted earnings per share from continuing operations		$	0.40		$	0.45(	1)

(1) Represents pro forma results. In 2008, we calculated our pro forma adjusted earnings by deducting from pro forma underlying operating profit certain normally recurring items appearing below operating profit on the income statement.  Additionally, we deducted costs associated with our integration program as well as earnings attributable to non-controlling interests and dividends declared on preference shares. The calculation of pro forma adjusted earnings and adjusted earnings per share for the three months ended March 31, 2008 is included in Appendix B of this amended management’s discussion and analysis.

Our adjusted earnings and adjusted earnings per share from continuing operations decreased compared to the prior year period due to the impact of higher integration related-costs, which lowered the per share amount $0.07 compared to the prior year period.

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Consolidated Results – IFRS Basis

The following table summarizes selected financial results:

	Three months ended March 31,
(millions of U.S. dollars, except per share amounts)	2009		2008
Revenues		3,131		1,840
Operating profit		376		228
Earnings from continuing operations		189		193
Net earnings		193		195
Earnings attributable to common and ordinary shareholders		190		193
Diluted earnings per share from continuing operations	$	0.22	$	0.29
Diluted earnings per share	$	0.23	$	0.30

Revenues.  Revenues increased 70% compared to the prior year period, primarily due to the acquisition of Reuters.  Revenue increases were also attributable to increases from existing businesses in our Professional division, particularly in Healthcare & Science.  Contributions from other acquired businesses included our December 31, 2008 acquisition of Paisley, which is part of our Tax & Accounting segment.

Operating profit.  Operating profit increased 65% due to the increase in revenues.  The effects of higher revenues on operating profit were partly offset by integration program costs and increased depreciation and amortization of computer software and other intangible assets.  

Depreciation.  Depreciation expense increased $74 million, or 135%, compared to the prior year period primarily due to the acquisition of Reuters, as well as from capital expenditures by our existing businesses.

Amortization of computer software. Amortization of computer software increased $64 million, or 84%, compared to the prior year period primarily due to the acquisition of Reuters.

Amortization of other intangible assets.Amortization of other intangible assets increased $57 million, or 92%, compared to the prior year period due to the amortization of the acquired Reuters assets. Relative to our existing businesses, amortization of other intangible assets decreased slightly as increases from newly-acquired assets were offset by decreases from the completion of amortization for certain identifiable intangible assets acquired in previous years.  

Net interest expense / income.  For the three months ended March 31, 2009, net interest expense of $96 million reflected higher borrowings related to the financing of the Reuters acquisition. For the three months ended March 31, 2008, net interest income of $38 million reflected $110 million of interest income from the investment of the proceeds from the sale of our former Learning higher education, careers and library reference businesses in money market funds, prior to using these funds towards the cash portion of the Reuters acquisition consideration.

Other finance costs.  For the three months ended March 31, 2009, other finance costs of $23 million reflected losses on freestanding derivatives and ineffectiveness on certain hedging derivative instruments as well as losses from changes in foreign currency exchange rates on certain intercompany funding arrangements. Accounting rules require that foreign currency gains and losses on intercompany arrangements are recognized in earnings when these arrangements are settled, or when they are not considered permanent in nature.

For the three months ended March 31, 2008, other finance costs of $28 million was comprised primarily of losses on the fair value of British pound sterling call options acquired in the third quarter of 2007 as part of our hedging program to mitigate exposure to changes in the $/£ exchange rate on the cash consideration to be paid for Reuters. See the section entitled “Hedging Program for Reuters Consideration” for further discussion.

Share of post-tax earnings in equity method investees. For the three months ended March 31, 2009, we realized $1 million in equity in earnings of unconsolidated affiliates. Amounts for the comparable prior year period were negligible.

Tax expense.  Tax expense for the three months ended March 31, 2009 and 2008 reflected the mix of taxing jurisdictions in which pre-tax profits and losses were recognized. Seasonality in our businesses can affect our geographic mix of pre-tax profits and losses in interim periods and, therefore, distort our reported tax rate. Consequently, our effective tax rate in interim periods is not necessarily indicative of our estimated effective tax rate for the full year.

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Net earnings and earnings per share. Net earnings were $193 million in the three months ended March 31, 2009 compared to earnings of $195 million in the prior year period.  Diluted earnings per share were $0.23 in the three months ended March 31, 2009 compared to $0.30 in the prior year period. Net earnings decreased as increased operating profit was offset by increased interest expense and higher tax expense. Basic and diluted earnings per share in the three months ended March 31, 2009 also reflected an increase in our number of shares outstanding, as we issued approximately 194 million shares as part of the Reuters acquisition consideration on April 17, 2008.

Segment Results

A discussion of the operating results of each segment follows. Our definition of segment operating profit as reflected below may not be comparable to that of other companies. We define segment operating profit as operating profit before: (i) amortization of other intangible assets; (ii) other operating gains and losses; and (iii) asset impairment charges. We use this measure for our segments because we do not consider these excluded items to be controllable operating activities for purposes of assessing the current performance of our segments. We also use segment operating profit margin, which we define as segment operating profit as a percentage of revenues.

Results for our Professional division were not impacted by the Reuters acquisition. Therefore, pro forma 2008 financial information is only provided for the results of our Markets division.

We have restated our 2008 segment results to be comparable to our 2009 presentation as described within the “Professional division” results of operations discussion below. We have also reclassified certain revenue streams within our Markets segment from our Media business unit to our Sales & Trading business unit as described within the “Markets division” results of operations discussion below.

Markets division

2009 IFRS Basis Compared to 2008 Pro Forma Basis Results

The following table provides information about revenues and segment operating profit calculated in accordance with IFRS for 2009 results and on a pro forma basis for 2008 results:

	Three months ended March 31,							Percentage change due to:
(millions of U.S. dollars)		2009			2008(1)				Existing    businesses			Acquired   businesses		Foreign  currency			Total
Revenues
Sales & Trading(2)			890			981				(2	%)		--		(7	%)		(9	%)
Investment & Advisory			571			596				1	%		--		(5	%)		(4	%)
Enterprise			304			300				9	%		--		(8	%)		1	%
Media(2)			89			108				(8	%)		--		(10	%)		(18	%)
Markets division total			1,854			1,985				--			--		(7	%)		(7	%)
Segment operating profit			337			338												--
Segment operating profit margin			18.2	%		17.0	%

(1) Represents pro forma results.

(2) Results for 2008 have been restated to reflect the 2009 presentation. Effective January 1, 2009, a business previously reported within Media was transferred to Sales & Trading to align these results with our current management structure.

Revenues decreased 7% primarily as a result of unfavorable changes in foreign currency exchange rates as the U.S. dollar strengthened against other global currencies.

Revenues from existing businesses, which exclude the effects of foreign currency, were comparable to the prior year period despite the difficult economic environment. Decreases in transaction revenues were offset by increased revenues from data feeds and advanced analytics.  Geographically, revenues increased in Asia and EMEA, offsetting decreased revenues in the Americas.  Net new sales (gross sales minus cancellations) were down in the first quarter of 2009 due to the continuing global economic recession and disruption in the financial markets, which have adversely affected some of our customer sectors.

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An analysis of performance of our existing businesses by sub-segment follows:

· Sales & Trading revenues decreased 2%, primarily due to lower Foreign Exchange transaction volumes and a decline in desktop subscriptions. These decreases were partly offset by increased revenues from Commodities & Energy and Tradeweb. Commodities & Energy benefited from demand for our information and transaction capabilities, while Tradeweb benefited from higher trading volumes.

· Investment & Advisory revenues increased 1%, driven by increases across all our businesses except Investment Banking. Investment Management revenue increases were driven by demand for advanced analytics product offerings. Wealth Management benefited from strong growth in Asia and demand for back office transaction processing solutions. Corporate Services revenues increased due to geographic expansion of investor relations and business intelligence services. As anticipated, revenues from Investment Banking decreased as the current recession has impacted its customer base.

· Enterprise revenues increased 9%, reflecting continuing strong demand for real-time, pricing and reference data as customers seek ways to automate back office processes and trade execution as well as improve pricing transparency and meet regulatory requirements.  Omgeo, our trade processing joint venture, had lower transaction revenues in the quarter.

· Media revenues decreased 8%, primarily due to decreases from our consumer and professional publishing businesses associated with lower advertising revenues. Revenues from our agency business decreased modestly due to lower demand for our news and information service offerings.

Segment operating profit was comparable to the prior year as savings from integration programs and cost control efforts were offset by the impact of lower revenues. Segment operating profit margin increased primarily due to benefits from foreign currency as well as savings from integration programs and cost control efforts.

IFRS Results

The following table provides information about revenues and segment operating profit on an IFRS basis:

	Three months ended March 31,
(millions of U.S. dollars)	2009			2008
Revenues		1,854			565
Segment operating profit		337			110
Segment operating profit margin		18.2	%		19.5	%

Revenues and segment operating profit increased primarily due to the acquisition of Reuters.  The increase in segment operating profit also reflected the realization of benefits from our integration program. Segment operating profit margin decreased due to a less profitable product mix.

Professional division

In the first quarter of 2009, we reorganized the Professional division into three segments: Legal, Tax & Accounting and Healthcare & Science. The Tax & Accounting segment now includes certain international businesses previously reported in the Legal segment. An intellectual property business that combines Professional division-wide capabilities related to patents, trademarks and standards is now managed within the Legal segment. The Healthcare & Science segment now manages the Healthcare businesses as well as the operations of the former Scientific segment which serve the pharmaceutical, academic and government markets.  Segment information for the three months ended March 31, 2008 was restated to reflect this organizational structure.

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The following table summarizes revenues for the three months ended March 31, 2009 and 2008:

	Three months ended March 31,			Percentage change due to:
(millions of U.S. dollars)		2009	2008		Existing    businesses		Acquired   businesses		Foreign  currency		Total
Revenues from ongoing businesses		1,274	1,252		3	%	2	%	(3	%)	2	%
Revenues from disposals		4	27		n/m		n/m		n/m		n/m
Revenues		1,278	1,279		n/m		n/m		n/m		--

n/m = not meaningful.

The following table summarizes operating profit for the three months ended March 31, 2009 and 2008:

	Three months ended March 31,
(millions of U.S. dollars)	2009			2008			% Change
Operating profit from ongoing businesses		313			306			2	%
Operating profit from disposals		(6	)		(3	)		n/m
Operating profit		307			303			1	%
Operating profit margin for ongoing businesses		24.6	%		24.4	%
Operating profit margin		24.0	%		23.7	%

n/m = not meaningful.

For our Professional division, revenues and operating profit approximated that of the prior year period. These results include our Dialog business that was sold in July 2008 as well as our PDR (Physicians’ Desk Reference) and PLM (a provider of drug information in Latin America) businesses which we intend to sell. We report these businesses as disposals as they were not classified as discontinued operations.  The following discussion regarding our performance is related to our ongoing businesses.

Revenues from ongoing businesses increased 5% before the effects of foreign currency translation, comprised of 3% from existing businesses and 2% from acquired businesses. The increase in revenues from existing businesses was primarily from online solutions, software and services.  Print revenues were comparable to the prior year due to the favorable timing of shipments. Revenues from acquired businesses included contributions from our December 31, 2008 acquisition of Paisley and other tactical acquisitions.

Operating profit from ongoing businesses increased 2% and the related margin increased 20 basis points to 24.6%, primarily due to benefits from foreign currency offset by the impact of lower initial margins from acquisitions and other one-time technology related costs.

Legal

	Three months ended March 31,						Percentage change due to:
(millions of U.S. dollars)	2009			2008			Existing    businesses			Acquired   businesses			Foreign  currency			Total
Revenues		832			837			2	%		1	%		(4	%)		(1	%)
Segment operating profit		241			233												3	%
Segment operating profit margin		29.0	%		27.8	%

Revenues increased 3% excluding the effects of foreign currency translation. Revenues from existing businesses reflected the following:

· Online services revenues increased 3%, led by demand for Westlaw and other international online services.  Westlaw revenues benefited from expanded content and workflow tool offerings, which more than offset lower revenues from ancillary database usage as law firms tighten spending;

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· Software and services revenues were comparable to the prior year period. FindLaw revenues increased due to continued demand for client development solutions.  However, these increases were offset by lower demand for certain offerings more sensitive to the weaker economic environment, including trademark searches, enterprise management software, consulting services and legal education-related services; and

· Print and CD revenues increased 1% due to favorable timing on product shipments but returns and cancellations increased substantially.  For the full year, we anticipate print and CD revenues to be lower than the prior year primarily due to the weaker economic environment.

Segment operating profit benefited from the effects of efficiency initiatives, which have resulted in reduced headcount. Segment operating profit margin benefited from favorable foreign currency and the effects of efficiency initiatives.

Tax & Accounting

	Three months ended March 31,						Percentage change due to:
(millions of U.S. dollars)	2009			2008			Existing    businesses			Acquired   businesses			Foreign  currency			Total
Revenues		245			227			4	%		6	%		(2	%)		8	%
Segment operating profit		41			44												(7	%)
Segment operating profit margin		16.7	%		19.4	%

Revenues increased 10% excluding the effects of foreign currency translation. Revenues from existing businesses increased as a result of the following:

· Continued demand in the Research and Guidance sector for Checkpoint online;

· Higher Professional Software and Services sales of Ultra Tax software and related software suites; and

· Demand for Corporate Software and Services, principally income tax software and related services.  This was partially offset by unfavorable timing of revenues in our property tax services business, which is expected to reverse later in 2009.

Revenues from acquired businesses reflected our December 31, 2008 acquisition of Paisley, as well as other businesses acquired in 2008.

Segment operating profit and the related operating profit margin decreased, as expected, primarily due to lower initial margins of acquired businesses.

Healthcare & Science

	Three months ended March 31,						Percentage change due to:
(millions of U.S. dollars)	2009			2008			Existing    businesses			Acquired   businesses		Foreign  currency			Total
Revenues from ongoing businesses		197			188			8	%		--		(3	%)		5	%
Revenues from disposals		4			27			n/m			n/m		n/m			n/m
Revenues		201			215			n/m			n/m		n/m			(7	%)
Operating profit from ongoing businesses		31			29											7	%
Operating profit from disposals		(6	)		(3	)										n/m
Operating profit		25			26											(4	%)
Operating profit margin for ongoing businesses		15.7	%		15.4	%
Operating profit margin		12.4	%		12.1	%

n/m = not meaningful.

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Revenues from ongoing businesses increased 8% excluding the effects of foreign currency translation and reflected the following:

· Continued strong demand from the payer market for our decision support solutions, for which revenues increased 20% compared to the prior year period; and

· Increased subscription revenues for Web of Science and ISI Web of Knowledge.

Operating profit from ongoing businesses and the related operating profit margin were largely comparable to the prior year period as the favorable effects from increased revenue were offset by one-time technology costs.

Corporate and Other

2009 IFRS Basis Compared to 2008 Pro Forma Basis Results

The following table details our Corporate and Other expenses for 2009 on an IFRS basis and for 2008 on a pro forma basis:

	Three months ended March 31,
(millions of U.S. dollars)	2009		2008(1)
Core corporate expenses		60		55
Integration program costs		88		13
Fair value adjustments		1		(20	)
Total		149		48

(1) Presented on a pro forma basis

Corporate and Other expenses increased $101 million primarily due to higher integration program costs and the effects of fair value adjustments. Core corporate expenses increased as savings realized from our integration program were more than offset by higher pension and share-based compensation expenses.

Under our previously reported comparison of Canadian GAAP 2009 actual to 2008 pro forma results, Corporate and Other expenses increased $89 million. The $12 million increase to Corporate and Other expense under IFRS was due to different measurement methodologies for pension and share-based compensation expenses.

Comparability was affected by higher benefits from fair value adjustments associated with foreign currency embedded derivatives in customer contracts in the prior year period. The first quarter of 2009 does not include a similar level of benefits as foreign exchange rate fluctuations were less significant in that period.  

For the year ended December 31, 2008, pension expense under IFRS was $33 million less than under Canadian GAAP due to the exclusion of the amortization of actuarial losses, which are recorded directly to equity under IFRS.  These amounts were included as a component of pension expense under Canadian GAAP.  In 2009, we expect pension expense under IFRS to be 60% higher than in 2008 under IFRS due to lower expected returns on plan assets, resulting from a lower fair value of plan assets at December 31, 2008 compared to December 31, 2007, and lower discount rates.

IFRS Results

The following table details our Corporate and Other expenses on an IFRS basis for the periods presented:

	Three months ended March 31,
(millions of U.S. dollars)	2009		2008
Core corporate expenses		60		42
Integration program costs		88		13
Reuters transaction costs		-		68
Fair value adjustments		1		-
Total		149		123

Corporate and Other expenses increased $26 million due to higher integration program costs and increased core corporate expenses related to pension and share-based compensation expenses.

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Under our previously reported comparison of Canadian GAAP 2009 actual to 2008 actual results, Corporate and Other expenses increased $14 million. The $12 million increase to Corporate and Other expense under IFRS was due to different measurement methodologies for pension and share-based compensation expenses.

In the prior year period, Reuters transaction costs primarily consisted of consulting costs for integration planning and close date communications, as well as expenses associated with retention programs.

LIQUIDITY AND CAPITAL RESOURCES

We expect to continue to generate significant free cash flow in 2009 because of our strong business model and diversified customer base.  We also have access to a committed $2.5 billion syndicated credit facility until August 2012.  In March 2009, we issued C$750 million (approximately $610 million) of long-term debt securities reflecting our continued ability to access credit markets.  We believe that cash from our operations and available credit facilities will be sufficient to fund our cash dividends, debt service, capital expenditures, acquisitions in the normal course of business and possible share repurchases.  We include more detail about our liquidity and capital resources below.

Financial Position

At March 31, 2009, our total assets were approximately $34 billion, consistent with that at December 31, 2008.  Higher cash balances from our cash flow from operations and March 2009 debt issuance were offset by the effects of depreciation, amortization and changes in foreign currency exchange rates.

The following table presents information related to net debt, shareholders’ equity and the ratio of net debt to shareholders’ equity as of the dates indicated:

	As at
(millions of U.S. dollars)	March 31, 2009			December 31, 2008
Current indebtedness		671			688
Long-term debt		7,320			6,783
Total debt		7,991			7,471
Swaps		162			57
Total debt after swaps		8,153			7,528
Remove fair value adjustments for hedges		(2	)		26
Remove transaction costs and discounts included in carrying value of debt		48			47
Less: cash and cash equivalents		(1,251	)		(841	)
Net debt		6,948			6,760
Total shareholders’ equity		18,159			18,488
Net debt/equity ratio	0.38:1			0.37:1

Total debt includes our March 2009 issuance of C$750 million principal amount of 6.00% notes due in March 2016. Upon completion of this offering, we entered into two cross-currency swap agreements which converted the notes to US$610 million principal amount with an interest rate of 6.915%. The net proceeds from this issuance are being used to repay 2009 note maturities in June, August and December. Prior to the maturity dates of these notes, we may invest the net proceeds in short-term investments. At March 31, 2009, the net proceeds were invested in short-term bank deposits and reported in “cash and cash equivalents” in our statement of financial position.

We guarantee certain obligations of our subsidiaries, including borrowings by our subsidiaries under our revolving credit facility. Under our revolving credit facility discussed below, we must maintain a ratio of net debt as of the last day of each fiscal quarter to adjusted EBITDA (earnings before interest, income taxes, depreciation and amortization and other modifications described in the guarantee) for the last four quarters ended of not more than 4.5:1.  We were in compliance with this covenant at March 31, 2009.

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Effective April 17, 2008, Thomson Reuters Corporation and Thomson Reuters PLC each guarantee all contractual obligations of the other company, and those of other parties to the extent they are guaranteed by the other company, and other obligations as agreed. Thomson Reuters PLC also guarantees all contractual obligations of Reuters existing as of April 17, 2008 and, as a result, those obligations are covered by Thomson Reuters Corporation’s guarantee of Thomson Reuters PLC’s obligations.

In February 2008, we repaid $400 million principal amount of notes upon their maturity.

The maturity dates for our long-term debt are well balanced with no significant concentration in any one year. At March 31, 2009, the carrying amounts of our total current liabilities exceeded the carrying amounts of our total current assets because current liabilities include deferred revenue. Deferred revenue does not represent a cash obligation, but rather an obligation to perform services or deliver products in the future. The costs to fulfill these obligations are included in our operating costs.

We monitor the financial strength of financial institutions with which we have banking and other commercial relationships, including those that hold our cash and cash equivalents as well as those which are counterparties to derivative financial instruments and other arrangements.

The following table displays the changes in our shareholders’ equity:

(millions of U.S. dollars)
Balance at December 31, 2008	18,488
Net earnings for the three months ended March 31, 2009	193
Common and ordinary share issuances	37
Effect of stock compensation plans on paid in capital	(18	)
Dividends declared on common and ordinary shares	(232	)
Dividends declared on preference shares	(1	)
Unrecognized net loss on cash flow hedges	(17	)
Change in foreign currency translation adjustment	(334	)
Actuarial gains on defined benefit pension plans	40
Distributions to non-controlling interests, net of tax adjustments	3
Balance at March 31, 2009	18,159

Ratings

Creditors of Thomson Reuters Corporation and Thomson Reuters PLC that are entitled to the benefit of cross guarantees between the two parent companies have been, to the extent possible, placed in the same position as if the obligation were owed by Thomson Reuters. In light of these guarantees, each of Thomson Reuters Corporation and Thomson Reuters PLC is exposed to the credit risk of the other. Accordingly, both companies share the same credit rating.

The following table sets forth the ratings that we have received from rating agencies in respect of our outstanding securities as of March 31, 2009:

	Moody’s	Standard & Poor’s	DBRS Limited	Fitch
Long-term debt	Baa1	A-	A (low)	A-
Commercial paper	-	-	R-1 (low)	F2
Trend/Outlook	Stable	Negative	Stable	Stable

There have been no changes in our credit ratings from Moody’s, Standard & Poor’s, DBRS Limited and Fitch in 2009. We are not aware of any changes being contemplated by these rating agencies.

You should be aware that a rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or withdrawal at any time by the assigning rating organization. We cannot assure you that our credit ratings will not be lowered in the future or that rating agencies will not issue adverse commentaries regarding our securities.

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Treasury Locks

In November 2007, we entered into two treasury lock agreements with a total notional amount of $800 million in anticipation of the issuance of debt securities during 2008. The agreements were intended to offset changes in future cash flows attributable to fluctuations in interest rates and were designated as cash flow hedges. The fair value of the treasury lock agreements represented a loss of $51 million at March 31, 2008, which was recorded in accumulated other comprehensive income. Upon the issuance of debt securities in June 2008, we settled the agreements for a loss of approximately $5 million, which is being amortized to interest over the 10 year term of the related debt.

Hedging Program for Reuters Consideration

As the funding of the cash consideration paid to former Reuters shareholders fluctuated based on the $/£ exchange rate, we commenced a hedging program to mitigate exposure to changes in the $/£ exchange rate. In the third quarter of 2007, we paid $76 million for the purchase of several sterling call options with a cumulative notional value of £2.3 billion and various strike prices approximating $2.05/£1.00. We recorded a loss of $26 million in the three months ended March 31, 2008 as a result of the expiration of certain of these options and changes in fair value.

Throughout April 2008, we entered into multiple short-term forward foreign exchange contracts to mitigate exposures to changes in the $/£ exchange rate. We recognized a gain of $9 million within other finance costs in our income statement associated with these agreements in the second quarter of 2008.

Additionally, after we completed the sale of Thomson Learning in 2007, we invested a portion of the proceeds in sterling-denominated money market funds and in sterling term bank deposits. As of March 31, 2008, the balance in these funds, which were included in our statement of financial position as cash and cash equivalents, totaled approximately £3 billion. These funds were subsequently utilized to fund a portion of the cash consideration paid to former Reuters shareholders.

Share Repurchase Program

We may repurchase shares from time to time as part of our capital management strategy. Decisions regarding any future repurchases will be based on market conditions, share price and other factors including opportunities to invest capital for growth. We may repurchase shares in open market transactions on the Toronto Stock Exchange, London Stock Exchange or the New York Stock Exchange. We may elect to suspend or discontinue our share repurchases at any time, in accordance with applicable laws. Shares that are repurchased are cancelled. From time to time when we do not possess material nonpublic information about ourselves or our securities, we may enter into a pre-defined plan with our broker to allow for the repurchase of shares at times when we ordinarily would not be active in the market due to our own internal trading blackout periods, insider trading rules or otherwise. Any such plans entered into with our broker will be adopted in accordance with applicable Canadian and English securities laws and the requirements of Rule 10b5-1 under the U.S. Securities Exchange Act of 1934, as amended.

In April 2008, we commenced a $500 million share repurchase program, under which approximately 16.5 million Thomson Reuters PLC ordinary shares were ultimately repurchased through the program’s completion in July 2008. We subsequently repurchased an additional 0.9 million Thomson Reuters PLC ordinary shares at a cost of $21 million during the third quarter of 2008. We did not repurchase any Thomson Reuters Corporation common shares or Thomson Reuters PLC ordinary shares in the three months ended March 31, 2009.  Additionally, we did not repurchase any Thomson Reuters Corporation common shares in the year ended December 31, 2008.

The following table summarizes recent repurchase activities, which all related to Thomson Reuters PLC ordinary shares:

Three months ended	Shares     repurchased		Average  price per share
March 31, 2008		--		--
June 30, 2008		15,645,535	$	30.59
September 30, 2008		1,737,350	$	24.68
December 31, 2008		--		--
March 31, 2009		--		--

See the section entitled “Subsequent Events” for additional information.

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Dividend Reinvestment Plan (DRIP)

All eligible Thomson Reuters Corporation and Thomson Reuters PLC shareholders may elect to reinvest their dividends in additional common or ordinary shares, respectively. During 2008, Woodbridge reinvested the equivalent of 50% of the dividends it received during the first three quarters of 2008. Woodbridge’s reinvestment was in accordance with the terms of our DRIP.  

Tradeweb Partnership

In January 2008, we formed a partnership with a consortium of nine global securities dealers to seek to further expand Tradeweb, our electronic unit that is within the Markets division. The partnership utilizes Tradeweb’s established market position in creating a global multi-asset class execution venue for clients. See note 21toour amended financial statements for the three months ended March 31, 2009 for additional information.  

Cash Flow

Our principal sources of liquidity are cash provided by our operations, borrowings under our revolving credit facility and our commercial paper program, as well as the issuance of public debt. At March 31, 2009, there were no borrowings outstanding on our $2.5 billion revolving credit facility, which is available to provide adequate liquidity for us to repay certain future debt maturity obligations should we decide to repay these amounts through borrowings.  We also had no commercial paper outstanding at March 31, 2009. Our principal uses of cash during the three months ended March 31, 2009 and 2008 were for debt servicing costs, debt repayments, dividend payments, capital expenditures and acquisitions. Additionally, as discussed in the section entitled “Share Repurchases,” we have in other periods also used some of our cash to repurchase outstanding shares in open market transactions.  

Operating activities.  For the three months ended March 31, 2009, cash provided by operating activities was $251 million compared to $284 million for the prior year period. The decrease in cash provided was primarily a result of increases in working capital.  Comparison between periods was affected by the mix of businesses in each period.  The current year period included the acquired Reuters business, which traditionally uses cash in the first quarter of the year.  Reuters was not included in our cash flow in the prior year period as the acquisition was completed in the second quarter of 2008. Further, the current year reflected net interest payments, whereas the prior year included net interest income principally derived from funds held in anticipation of the Reuters acquisition.

Investing activities.  For the three months ended March 31, 2009, cash used by investing activities was $197 million compared to $149 million for the prior year period.  The increased use of cash was due to higher capital expenditures primarily related to the acquired Reuters operations.  Higher capital expenditures were incurred in our Markets division primarily for the development of common platforms for content and information delivery. Capital expenditures also increased in our Professional division as a result of continued development of our Westlaw platform.  The prior year period also reflected proceeds from, and investment related to, the formation of our Tradeweb partnership.

Financing activities. For the three months ended March 31, 2009, cash provided by financing activities was $365 million compared to $1.5 billion for the prior year period.  The decreased inflow reflected lower net proceeds from debt and short-term borrowings and an increase in dividend payments.  A comparison of this activity is as follows:

· There were no borrowings under either our credit facility or commercial paper program in the current year period, whereas the prior year period included combined net inflows of approximately $2.0 billion associated with preparing for the Reuters acquisition;

· Proceeds from debt in the current year period reflected our March 2009 issuance of C$750 million principal amount of 6.00% notes due in March 2016, whereas the prior year reflected a repayment of $400 million principal amount of notes; and

· Cash dividend payments were higher in the first quarter of 2009 due to a greater number of outstanding shares as a result of the Reuters acquisition and Woodbridge’s participation in our DRIP in 2008.

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The following table sets forth dividend activity related to our common and ordinary shares:  

	Three months ended March 31,
(millions of U.S. dollars)	2009			2008
Dividends declared		232			173
Dividends reinvested		(4	)		(47	)
Dividends paid		228			126

Significant financing activities from each period are discussed under the section entitled “Financial Position.”

Free cash flow. The following table sets forth calculations of our free cash flow for the three months ended March 31, 2009 and 2008:

	Three months ended March 31,
(millions of U.S. dollars)	2009			2008
Net cash provided by operating activities		251			284
Capital expenditures, less proceeds from disposals		(198	)		(117	)
Other investing activities		(1	)		(3	)
Dividends paid on preference shares		(1	)		(2	)
Investing activities of discontinued operations		-			(7	)
Free cash flow		51			155

Free cash flow for the three months ended March 31, 2009 was lower than that of the prior year period primarily reflecting the mix of businesses in each period.  Specifically:

· The current year period included the legacy Reuters businesses that traditionally have negative free cash flow in the first quarter of the year; and

· The current year reflected net interest payments, whereas the prior year included net interest income principally derived from funds held in anticipation of the Reuters acquisition.  Additionally, free cash flow in the current year period reflected increased spending on our integration program.

Credit facility.  We have a $2.5 billion unsecured revolving credit facility that currently expires in August 2012.  We may request an extension of the maturity date under certain circumstances for up to two additional one-year periods, which the applicable lenders may accept or decline in their sole discretion. We may also request an increase (subject to approval by applicable lenders) in the amount of the lenders’ commitments up to a maximum amount of $3.0 billion.  As of March 31, 2009, we had no borrowings against this facility (March 31, 2008 - $1.7 billion).

We can utilize the facility to provide liquidity in connection with our commercial paper program and for general corporate purposes. Based on our current credit rating, the cost of borrowing under the agreement is priced at the London Interbank Offered Rate plus 19 basis points (or plus 24 basis points on all borrowings when line utilization exceeds 50%). If our long-term debt rating was downgraded by Moody’s or Standard & Poor’s, our facility fee and borrowing costs may increase, although availability would be unaffected.  Conversely, an upgrade in our ratings may reduce our credit facility fees and borrowing costs. The agreement contains certain customary affirmative and negative covenants, each with customary exceptions. The financial covenant related to this agreement is described in the “Financial Position” subsection above. We monitor the lenders that are party to our syndicated credit agreement.  We believe that they continue to be willing and able to lend under the agreement.

Debt shelf registration.  In December 2008, we filed a new shelf prospectus that allows us to issue up to $3 billion principal amount of debt securities from time to time through January 2011. To date, we have issued approximately $610 million principal amount of debt securities under this prospectus.

Off-Balance Sheet Arrangements, Commitments and Contractual Obligations. For a summary of our other off-balance sheet arrangements, commitments and contractual obligations, please see our management’s discussion and analysis for the year ended December 31, 2008. There were no material changes to these other arrangements, commitments and obligations during the three months ended March 31, 2009.

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Contingencies

Lawsuits and Legal Claims

In February 2008, a purported class action complaint alleging violations of U.S. federal antitrust laws was filed in the United States District Court for the Central District of California against West Publishing Corporation, d/b/a BAR/BRI and Kaplan Inc.  In April 2008, this case was dismissed with prejudice.  The plaintiffs have appealed this dismissal.

In addition to the matter described above, we are engaged in various legal proceedings and claims that have arisen in the ordinary course of business. The outcome of all of the proceedings and claims against us, including the matter described above, is subject to future resolution, including the uncertainties of litigation.  Based on information currently known by us and after consultation with outside legal counsel, management believes that the probable ultimate resolution of any such proceedings and claims, individually or in the aggregate, will not have a material adverse effect on our financial condition, taken as a whole.

Other

The section entitled “Risks arising from Financial Instruments” in note 16 to our consolidated financial statements for the year ended December 31, 2008 contains a discussion of the risks that we face with respect to financial instruments.

Uncertain Tax Positions

We are subject to taxation in numerous jurisdictions. Significant judgment is required in determining the worldwide provision for taxation. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. We maintain provisions for uncertain tax positions that we believe appropriately reflect our risk with respect to tax matters under active discussion, audit, dispute or appeal with tax authorities, or which are otherwise considered to involve uncertainty. We review the adequacy of these provisions at each balance sheet date. However, it is possible that at some future date an additional liability could result from audits by taxing authorities. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will affect the tax provisions in the period in which such determination is made. In April 2008, upon the completion of a routine tax audit for the years 2003 to 2005, the Internal Revenue Service notified us that it would challenge certain positions taken on our tax returns. We do not believe that any material impact will result from this challenge.

Please also see our management’s discussion and analysis for the year ended December 31, 2008 for a summary of our uncertain tax positions.  

OUTLOOK

Based on the environment in the markets we serve as of May 6, 2009, we reaffirm our previous outlook that revenues are expected to grow in 2009 and underlying operating margin and free cash flow (adjusted for certain timing-related items) will be comparable to 2008, supported by revenue growth and the expected savings from integration programs.

Our outlook excludes the impact of changes in foreign currency exchange rates.

RELATED PARTY TRANSACTIONS

As of May 6, 2009, Woodbridge had a voting interest in Thomson Reuters of approximately 55%, based on the issued share capital of Thomson Reuters Corporation and Thomson Reuters PLC. Under the DLC structure, holders of Thomson Reuters Corporation common shares and Thomson Reuters PLC ordinary shares ordinarily vote together as a single decision-making body, including in the election of directors, and in that sense have voting interests in Thomson Reuters.

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Transactions with Woodbridge

From time to time, in the normal course of business, Woodbridge and certain of its affiliates purchase some of our products and service offerings. These transactions are negotiated at arm’s length on standard terms, including price, and are not significant to our results of operations or financial condition either individually or in the aggregate.

In the normal course of business, certain of our subsidiaries charge a Woodbridge-owned company fees for various administrative services. In 2008, the total amount charged to Woodbridge for these services was approximately $330,000.

We purchase property and casualty insurance from third party insurers and retain the first $500,000 of each and every claim under the programs via our captive insurance subsidiary. Woodbridge is included in these programs and pays us a premium commensurate with its exposures. These premiums were approximately $80,000 in 2008, which would approximate the premium charged by a third party insurer for such coverage.

We maintained an agreement with Woodbridge until April 17, 2008 (the closing date of the Reuters acquisition) under which Woodbridge agreed to indemnify up to $100 million of liabilities incurred either by our current and former directors and officers or by our company in providing indemnification to these individuals on substantially the same terms and conditions as would apply under an arm’s length, commercial arrangement. We were required to pay Woodbridge an annual fee of $750,000, which was less than the premium that would have been paid for commercial insurance. We replaced this agreement with a conventional insurance agreement. We are entitled to seek indemnification from Woodbridge for any claims arising from events prior to April 17, 2008 and made within a six-year run-off period following that date.

Transactions with Affiliates and Joint Ventures

We enter into transactions with our investments in affiliates and joint ventures. These transactions involve providing or receiving services and are entered into in the normal course of business and on an arm’s length basis.

We and The Depository Trust & Clearing Corporation each have a 50% interest in Omgeo, a provider of trade management services. Omgeo pays us for use of a facility and technology and other services. For the three months ended March 31, 2009, these services were valued at approximately $2 million.

We and Shin Nippon Hoki Shuppan K.K. each own 50% of Westlaw Japan K.K., a provider of legal information and solutions to the Japanese legal market. We provide the joint venture with technology and other services, which were valued at approximately $1 million for the three months ended March 31, 2009.

Our Tradeweb Markets business provides services, including use of its trading platform and various back office functions, to the Tradeweb New Markets business established in 2008, and in which it has a 20% ownership stake. For the three months ended March 31, 2009, we recognized revenues of $4 million related to these services.

In connection with the acquisition of Reuters, we assumed a lease agreement with 3XSQ Associates, an entity now owned by Thomson Reuters and Rudin Times Square Associates LLC that was formed to build and operate the 3 Times Square property and building in New York, New York that now serves as our corporate headquarters. We follow the equity method of accounting for our investment in 3XSQ Associates. The lease provides us with over 690,000 square feet of office space until 2021 and includes provisions to terminate portions early and various renewal options. Our costs related to 3XSQ Associates for the three months ended March 31, 2009 were approximately $9 million for rent, taxes and other expenses.

Other transactions

In February 2005, we entered into a contract with Hewitt Associates Inc. (Hewitt) to outsource certain human resources administrative functions in order to improve operating and cost efficiencies. Under the current contract terms, we expect to pay Hewitt an aggregate of approximately $165 million over a 10-year period that began in 2006. In 2008, we paid Hewitt $11 million for its services. Steven A. Denning, one of our directors and chairman of the board’s Human Resources Committee, was a director of Hewitt until February 2009. Mr. Denning has not participated in negotiations related to the contract and has refrained from deliberating and voting on the matter by the Human Resources Committee and the board of directors.

21

SUBSEQUENT EVENTS

In May 2009, we announced that we had received approval from the Toronto Stock Exchange (TSX) to renew our Normal Course Issuer Bid (NCIB) for Thomson Reuters Corporation common shares for an additional 12-month period. Under the bid, up to 15 million common shares may be repurchased in open market transactions on the TSX or the New York Stock Exchange between May 13, 2009 and May 12, 2010. As required by English law, we received shareholder approval at our annual general meeting held on May 13, 2009 to renew our buyback authority for up to approximately 27.2 million Thomson Reuters PLC ordinary shares.

ACCOUNTING POLICIES

See notes 1, 2 and 3 to our amended financial statements for the three months ended March 31, 2009 for our adoption of IFRS, for a detailed discussion regarding our significant accounting policies, application of critical accounting estimates and judgments, and recent accounting pronouncements.

ADDITIONAL INFORMATION

Depreciation and Amortization of Computer Software by Segment

The following table details the total of depreciation and amortization of computer software by segment for the three months ended March 31, 2009 and for the three months ended March 31, 2008 on both IFRS and pro forma basis. Amounts have been restated to be on a comparable basis to our 2009 segment presentation.

	Three months ended March 31,
							Pro Forma Basis
(millions of U.S. dollars)	2009			2008			2008
Markets division		(164	)		(42	)		(160	)
Professional division
Legal		(63	)		(60	)		(60	)
Tax & Accounting		(19	)		(14	)		(14	)
Healthcare & Science		(17	)		(12	)		(12	)
Corporate and Other		(5	)		(1	)		(1	)
Disposals		(1	)		(2	)		(2	)
Total		(269	)		(131	)		(249	)

Disclosure Controls and Procedures

Our Chief Executive Officer and Chief Financial Officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in applicable U.S. and Canadian securities law) as of the end of the period covered by this amended management’s discussion and analysis, have concluded that our disclosure controls and procedures are effective to ensure that all information that we are required to disclose in reports that we file or furnish under the U.S. Securities Exchange Act and applicable Canadian securities law is (i) recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and Canadian securities regulatory authorities and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. Our internal and disclosure control processes have not required significant modification as a result of our adoption of IFRS.

Internal Control over Financial Reporting

The conversion to IFRS from Canadian GAAP impacts the way we present our financial results. We have evaluated the impact of the conversion on our accounting and financial reporting systems and we have updated the requisite systems to enable our reporting of historical Canadian GAAP information related to our initial IFRS adoption and for future periods to be reported under IFRS.

22

As a result of our acquisition of Reuters on April 17, 2008, we expanded our internal controls over financial reporting to include consolidation of the Reuters results of operations, as well as acquisition accounting and disclosures.  Additionally, in 2008, as part of our integration program, we migrated certain legacy financial processing systems to company-wide software as well as transferred various workflows to shared service centers.  In connection with the software implementation and transfer of workflows from the legacy systems, we modified the design and documentation of our internal control processes and procedures.

As we execute our integration program across our organization through 2011, we anticipate that additional business information systems will be consolidated and related workflow processes will be migrated as legacy shared service center environments mature into a single global business services organization. There was no change in our internal control over financial reporting that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting other than changes related to our adoption of IFRS.

Share Capital

As of May 6, 2009, we had outstanding 647,393,892 common shares of Thomson Reuters Corporation, 181,229,241 ordinary shares of Thomson Reuters PLC, 6,000,000 Series II preference shares, 16,846,626 stock options and a total of 7,387,658 restricted share units and performance restricted share units.

A Reuters Founders Share has also been issued by each of Thomson Reuters Corporation and Thomson Reuters PLC which enables Reuters Founders Share Company to exercise extraordinary voting power to safeguard the Reuters Trust Principles. Thomson Reuters Corporation and Thomson Reuters PLC have also each issued a special voting share to a special voting trust so that shareholders of the two companies can ordinarily vote together as a single decision-making body. Thomson Reuters Corporation has issued an equalization share to Thomson Reuters PLC in connection with Thomson Reuters Corporation’s support obligations under the DLC structure.

Public Securities Filings and Regulatory Announcements

You may access other information about Thomson Reuters, including our 2008 annual report (which contains information required in an annual information form) and our other disclosure documents, reports, statements or other information that we file with the Canadian securities regulatory authorities through SEDAR at www.sedar.com and in the United States with the SEC at www.sec.gov. Information that we announce in the United Kingdom through RNS, a Regulatory Information Service (including this amended management’s discussion and analysis and our financial statements) is available on our website, www.thomsonreuters.com, as well as in our filings and submissions with the Canadian securities regulatory authorities and the SEC.

CAUTIONARY NOTE CONCERNING FACTORS THAT MAY AFFECT FUTURE RESULTS

This amended management’s discussion and analysis, in particular the sections entitled “Outlook”, and “Integration Program”, includes forward-looking statements as of May 6, 2009 that are based on certain assumptions and reflect our current expectations. Forward-looking statements are those that are not historical facts and also include our expectations about future prospects. 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. Some of the factors that could cause actual results to differ materially from current expectations are discussed in the “Risk Factors” section of our 2008 annual report. Additional factors are discussed in our materials filed with the securities regulatory authorities from time to time. All information that is not historical in nature disclosed in this amended management’s discussion and analysis is deemed to be a forward-looking statement. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by law, rule or regulation.

23

APPENDIX A

SUPPLEMENTAL IFRS CONVERSION INFORMATION

The following are reconciliations of our income statement previously presented under Canadian GAAP to that under IFRS for the six months ended June 30, 2008 and the nine months ended September 30, 2008.

See note 27 to our amended financial statements for the three months ended March 31, 2009 for a detailed discussion of our conversion from Canadian GAAP to IFRS.

Consolidated Income Statement for the six months ended June 30, 2008

(millions of U.S. dollars)

Canadian GAAP accounts	Canadian GAAP   balance			IFRS       adjustments			IFRS           reclassifications			IFRS   balance			IFRS accounts
Revenues		4,962			6			5			4,973		Revenues
Cost of sales, selling, marketing, general and administrative expenses		(3,863	)		(19	)		31			(3,851	)	Operating expenses
Depreciation		(313	)		(9	)		155			(167	)	Depreciation
		-			(14	)		(190	)		(204	)	Amortization of computer software
Amortization		(203	)		23			-			(180	)	Amortization of other intangible assets
Impairment of assets held for sale		(72	)		(17	)		-			(89	)	Impairment of assets held for sale
Operating profit		511			(30	)		1			482		Operating profit
													Finance costs, net:
Net interest expense and other financing costs		(15	)		-			3			(12	)	Net interest expense
Net other expense		(64	)		(4	)		(4	)		(72	)	Other finance costs
		432			(34	)		-			398		Income before tax and equity method investees
Tradeweb ownership interests, net of tax		(6	)		(1	)		8			1		Share of post tax earnings in equity method investees
Income taxes		(54	)		11			(3	)		(46	)	Tax expense
Earnings from continuing operations		372			(24	)		5			353		Earnings from continuing operations
Loss from discontinued operations, net of tax		(5	)		-			1			(4	)	Loss from discontinued operations, net of tax
Net earnings		367			(24	)		6			349		Net earnings
Dividends declared on preference shares		(3	)
Earnings attributable to Thomson Reuters Corporation common shares and Thomson Reuters PLC ordinary shares		364
													Earnings attributable to:
											343		Common and ordinary shareholders
											6		Non-controlling interests
Earnings per share
Basic and diluted earnings per share:
From continuing operations	$	0.52								$	0.48
From discontinued operations		(0.01	)								(0.01	)
Basic and diluted earnings per share	$	0.51								$	0.47

24

Consolidated Income Statement for the nine months ended September 30, 2008

(millions of U.S. dollars)

Canadian GAAP accounts	Canadian GAAP   balance			IFRS       adjustments			IFRS           reclassifications			IFRS   balance			IFRS accounts
Revenues		8,295			9			8			8,312		Revenues
Cost of sales, selling, marketing, general and administrative expenses		(6,333	)		1			54			(6,278	)	Operating expenses
Depreciation		(525	)		(19	)		255			(289	)	Depreciation
		-			(28	)		(316	)		(344	)	Amortization of computer software
Amortization		(361	)		55			-			(306	)	Amortization of other intangible assets
Impairment on assets held for sale		(72	)		(17	)		-			(89	)	Impairment of assets held for sale
		-			1			28			29		Other operating gains
Operating profit		1,004			2			29			1,035		Operating profit
													Finance (costs) income, net:
Net interest expense and other financing costs		(122	)		-			1			(121	)	Net interest expense
Net other income		55			(5	)		(32	)		18		Other finance income
		937			(3	)		(2	)		932		Income before tax and equity method investees
Tradeweb ownership interests, net of tax		(9	)					11			2		Share of post tax earnings in equity method investees
Income taxes		(164	)		1			(1	)		(164	)	Tax expense
Earnings from continuing operations		764			(2	)		8			770		Earnings from continuing operations
Loss from discontinued operations, net of tax		(16	)		1			-			(15	)	Loss from discontinued operations, net of tax
Net earnings		748			(1	)		8			755		Net earnings
Dividends declared on preference shares		(4	)
Earnings attributable to Thomson Reuters Corporation common shares and Thomson Reuters PLC ordinary shares		744
													Earnings attributable to:
											747		Common and ordinary shareholders
											8		Non-controlling interests
Earnings per share
Basic earnings per share:
From continuing operations	$	1.01								$	1.01
From discontinued operations		(0.02	)								(0.02	)
Basic earnings per share	$	0.99								$	0.99
Diluted earnings per share:
From continuing operations	$	1.00								$	1.00
From discontinued operations		(0.02	)								(0.02	)
Diluted earnings per share	$	0.98								$	0.98

25

APPENDIX B

RECONCILIATION OF UNAUDITED PRO FORMA INFORMATION UNDER CANADIAN GAAP TO UNDER IFRS

We have restated our previously reported unaudited pro forma information under Canadian GAAP to reflect our adoption of IFRS. The underlying financial information of Thomson Reuters is included in the accompanying amended financial statements for the three months ended March 31, 2009. The underlying financial information of Reuters was compiled from its internal records.

Our pro forma information:

· was not audited;

· was prepared on a basis as though the Reuters acquisition closed on January 1, 2007 and is for informational purposes only, and because of its nature, addresses a hypothetical situation and, therefore, does not represent our actual results;

· contains adjustments based on information current as of our management’s discussion and analysis for the year ended December 31, 2008;

· was calculated in a manner consistent with the preparation of the unaudited pro forma information included in Appendix A of our management’s discussion and analysis for the year ended December 31, 2008, except for the effect of our adoption of IFRS; and

· was not adjusted to reflect any matters not directly attributable to the Reuters acquisition. No adjustment, therefore, was made to periods prior to the closing date (April 17, 2008) for actions which have or may be taken upon completion of the acquisition, such as any of our integration plans.

The table below for the three months ended March 31, 2008 reconciles our unaudited pro forma information under Canadian GAAP to that under IFRS.  We also provide an additional analysis describing the reconciling items affecting pro forma operating profit for the period.

In the table below, “IFRS adjustments and reclassifications” represents changes made from Canadian GAAP to reflect our adoption of IFRS. See note 27 to our amended financial statements for the three months ended March 31, 2009 for details of these changes. In the table below, “IFRS effect on pro forma adjustments” represents changes made from Canadian GAAP information of Reuters for the pre-acquisition period of January 1, 2008 to March 31, 2008 and other adjustments in the calculation of pro forma information, as if this information was prepared under IFRS as applied by Thomson Reuters.

Three months ended March 31, 2008 (millions of U.S. dollars)
Canadian GAAP accounts	Pro forma  information under     Canadian   GAAP			IFRS           adjustments      and             reclassifications			IFRS      effect on pro forma      adjustments			Pro forma  information under IFRS			IFRS accounts
Revenues		3,254			6			-			3,260		Revenues
Cost of sales, selling, marketing, general and administrative expenses		(2,438	)		16			4			(2,418	)	Operating expenses
Depreciation		(235	)		66			47			(122	)	Depreciation
		-			(76	)		(51	)		(127	)	Amortization of computer software
Amortization		(129	)		-			-			(129	)	Amortization of other intangible assets
Operating profit		452			12			-			464		Operating profit

26

(millions of U.S. dollars)	Three months    ended            March 31, 2008
Pro forma operating profit under Canadian GAAP		452
Differences:
IFRS adjustments:
Employee benefits		5
Share-based payments		3
Revenue		5
Discontinued operations		(1	)
Pro forma operating profit under IFRS		464

Pro Forma Adjusted Earnings Under IFRS

The table below presents a reconciliation of pro forma underlying operating profit to pro forma adjusted earnings from continuing operations for the three months ended March 31, 2008.  In 2008, we calculated our pro forma adjusted earnings by deducting from pro forma underlying operating profit certain normally recurring items appearing below operating profit on the income statement.  Additionally, we deducted costs associated with our integration program as well as earnings attributable to non-controlling interests and dividends declared on preference shares.

(millions of U.S. dollars, except as otherwise indicated and except per share data) Pro forma basis	Three months    ended            March 31, 2008(1)
Underlying operating profit		589
Adjustments:
Integration program costs		(13	)
Net interest expense (calculated as pro rata $450 million annualized)		(113	)
Income taxes (calculated using an estimated effective tax rate of 25%)		(84	)
Earnings attributable to non-controlling interests		(2	)
Dividends declared on preference shares		(2	)
Adjusted earnings from continuing operations		375
Adjusted earnings per share from continuing operations	$	0.45
Weighted average common and ordinary shares outstanding (in millions)		838.6

(1) This calculation has been restated to be comparable to our 2009 presentation of disposals.

Weighted average common and ordinary shares outstanding reflected the actual reported diluted weighted average common and ordinary shares outstanding adjusted as if the approximately 194 million Thomson Reuters PLC shares issued to Reuters shareholders on April 17, 2008 were outstanding from the beginning of the period presented, as well as the effect of the approximately 34 million Reuters Group PLC share options assumed as part of the acquisition.

Additional Unaudited Pro Forma Information

Supplemental Reconciliations of Unaudited Pro Forma Information under Canadian GAAP to under IFRS

The following tables reconcile our unaudited pro forma information for the six months ended June 30, 2008, nine months ended September 30, 2008 and year ended December 31, 2008 under Canadian GAAP to that under IFRS. We also provide an additional analysis describing the reconciling items affecting pro forma operating profit for the respective periods.

These reconciliations have been compiled in a manner consistent with the methodology described above related to the three months ended March 31, 2008, unless otherwise indicated.

27

Six months ended June 30, 2008

(millions of U.S. dollars)
Canadian GAAP accounts	Pro forma  information under     Canadian   GAAP			IFRS          adjustments    and            reclassifications			Remove     IFRS        retrospective purchase    price        allocation			IFRS      effect on pro forma      adjustments			Pro forma  information under IFRS			IFRS accounts
Revenues		6,696			11			-			-			6,707		Revenues
Cost of sales, selling, marketing, general and administrative expenses		(5,084	)		12			(25	)		(4	)		(5,101	)	Operating expenses
Depreciation		(470	)		146			9			74			(241	)	Depreciation
		-			(204	)		14			(70	)		(260	)	Amortization of computer software
Amortization		(258	)		23			(25	)		-			(260	)	Amortization of other intangible assets
Impairment of assets held for sale		(72	)		(17	)		-			-			(89	)	Impairment of assets held for sale
Operating profit		812			(29	)		(27	)		-			756		Operating profit

(millions of U.S. dollars)	Six months    ended         June 30, 2008
Pro forma operating profit under Canadian GAAP		812
Differences:
IFRS adjustments:
Employee benefits		10
Share-based payments		4
Revenues		8
Impairments		(19	)
Business combinations		(33	)
Discontinued operations		1
Remove IFRS retrospective purchase price allocation included above		(27	)
Pro forma operating profit under IFRS		756

28

Nine months ended September 30, 2008

(millions of U.S. dollars)
Canadian GAAP accounts	Pro forma  information under     Canadian   GAAP			IFRS          adjustments    and            reclassifications			Remove     IFRS       retrospective purchase    price        allocation			IFRS      effect on pro forma      adjustments			Pro forma  information under IFRS			IFRS accounts
Revenues		10,029			17			-			-			10,046		Revenues
Cost of sales, selling, marketing, general and administrative expenses		(7,535	)		55			(34	)		(14	)		(7,528	)	Operating expenses
Depreciation		(711	)		236			19			93			(363	)	Depreciation
		-			(344	)		23			(79	)		(400	)	Amortization of computer software
Amortization		(385	)		55			(56	)		-			(386	)	Amortization of other intangible assets
Impairment of assets held for sale		(72	)		(17	)		-			-			(89	)	Impairment of assets held for sale
		-			29			-			-			29		Other operating gains
Operating profit		1,326			31			(48	)		-			1,309		Operating profit

(millions of U.S. dollars)	Nine months    ended           September 30, 2008
Pro forma operating profit under Canadian GAAP		1,326
Differences:
IFRS adjustments:
Employee benefits		16
Share-based payments		7
Revenues		13
Impairments		(4	)
Foreign currency translation adjustment		(14	)
Business combinations		(16	)
Other operating gains		28
Discontinued operations		1
Remove IFRS retrospective purchase price allocation included above		(48	)
Pro forma operating profit under IFRS		1,309

29

Year ended December 31, 2008

(millions of U.S. dollars)
Canadian GAAP accounts	Pro forma  information under     Canadian   GAAP			IFRS          adjustments    and            reclassifications			Remove     IFRS       retrospective purchase    price        allocation		IFRS      effect on pro forma      adjustments			Pro forma  information under IFRS			IFRS accounts
Revenues		13,441			-			-		-			13,441		Revenues
Cost of sales, selling, marketing, general and administrative expenses		(9,958	)		-			4		4			(9,950	)	Operating expenses
Depreciation		(964	)		417			4		55			(488	)	Depreciation
		-			(482	)		3		(59	)		(538	)	Amortization of computer software
Amortization		(511	)		(14	)		20		-			(505	)	Amortization of other intangible assets
Impairment of assets held for sale		(72	)		(14	)		-		-			(86	)	Impairment of assets held for sale
		-			68			-		-			68		Other operating gains
Operating profit		1,936			(25	)		31		-			1,942		Operating profit

(millions of U.S. dollars)	Year ended         December 31, 2008
Pro forma operating profit under Canadian GAAP		1,936
Differences:
IFRS adjustments:
Employee benefits		33
Share-based payments		6
Revenues		(1	)
Impairments		1
Foreign currency translation adjustment		(14	)
Business combinations		(119	)
Other operating gains		68
Discontinued operations		1
Remove IFRS retrospective purchase price allocation included above		31
Pro forma operating profit under IFRS		1,942

In the above tables, the caption “IFRS adjustments and reclassifications” represents changes made to Canadian GAAP information to reflect our adoption of IFRS. See note 27 to our amended financial statements for the three months ended March 31, 2009 for details of these changes.

30

Our previously reported pro forma information was compiled applying the final Reuters purchase price allocation retrospectively from January 1, 2007. Retrospective application was also made in converting our Canadian GAAP results to IFRS. Since our pro forma information already accounted for this application, we have removed this adjustment, which is contained within the caption “Business combinations” in the pro forma operating profit reconciliations above.

In the tables above, the caption “IFRS effect on pro forma adjustments” represents changes made to the Canadian GAAP information of standalone Reuters for the pre-acquisition period January 1, 2008 to April 16, 2008 and other adjustments in the calculation of pro forma information, as if this information was prepared under IFRS as applied by Thomson Reuters.

Pro Forma Underlying Operating Profit Under IFRS

The following table sets forth our pro forma underlying operating profit information for the six months ended June 30, 2008, nine months ended September 30, 2008 and year ended December 31, 2008.

(millions of U.S. dollars)	Six months ended June 30,        2008			Nine months ended September 30,     2008			Year ended   December 31, 2008
Operating profit		756			1,309			1,942
Adjustments:
Amortization of other intangible assets		260			386			505
Disposals		(1	)		4			(34	)
Impairment of assets held for sale		89			89			86
Fair value adjustments		(16	)		(77	)		(117	)
Integration program costs		214			310			468
Other operating gains		--			(29	)		(68	)
Underlying operating profit		1,302			1,992			2,782
Underlying operating profit margin		19.6	%		20.0	%		20.9	%

Pro Forma Adjusted Earnings Under IFRS

The following table sets forth our pro forma adjusted earnings information for the six months ended June 30, 2008, nine months ended September 30, 2008 and year ended December 31, 2008.

(millions of U.S. dollars, except as otherwise indicated and except per share data)	Six months ended June 30,        2008				Nine months ended September 30,     2008				Year ended   December 31, 2008
Underlying operating profit			1,302				1,992				2,782
Adjustments:
Integration program costs			(214	)			(310	)			(468	)
Net interest expense			(225	)			(334	)			(437	)
Income taxes (calculated using an estimated effective tax rate of 25%)			(151	)			(241	)			(343	)
Earnings attributable to non-controlling interests			(6	)			(8	)			(14	)
Dividends declared on preference shares			(3	)			(4	)			(5	)
Adjusted earnings from continuing operations			703				1,095				1,515
Adjusted earnings per share from continuing operations		$	0.84			$	1.31			$	1.82
Weighted average common and ordinary shares outstanding (in millions)			837.3				834.4				833.0

Pro forma net interest expense for the year ended December 31, 2008 represents the sum of the actual third and fourth quarter 2008 net interest expense under our new IFRS basis plus a pro rata portion of an estimated $450 million full year run-rate used for the six months ended June 30, 2008.

31

Pro Forma Segment Information Under IFRS

The following table sets forth our pro forma segment information for the six months ended June 30, 2008, nine months ended September 30, 2008 and year ended December 31, 2008.

(millions of U.S. dollars)	Six months ended June 30,        2008			Nine months ended September 30,     2008			Year ended   December 31, 2008
Revenues
Legal		1,787			2,727			3,639
Tax & Accounting		436			646			926
Healthcare & Science		394			594			817
Professional division		2,617			3,967			5,382
Sales & Trading		1,989			2,959			3,852
Investment & Advisory		1,189			1,789			2,371
Enterprise		638			945			1,295
Media		220			325			426
Markets division		4,036			6,018			7,944
Eliminations		(7	)		(8	)		(10	)
Revenues from ongoing businesses		6,646			9,977			13,316
Disposals		61			69			125
Revenues		6,707			10,046			13,441
Operating profit
Legal		573			895			1,192
Tax & Accounting		78			118			216
Healthcare & Science		71			109			173
Professional division		722			1,122			1,581
Markets division		705			1,041			1,406
Corporate and Other		(323	)		(404	)		(556	)
Amortization of other intangible assets		(260	)		(386	)		(505	)
Operating profit from ongoing businesses		844			1,373			1,926
Disposals		1			(4	)		34
Impairment of assets held for sale		(89	)		(89	)		(86	)
Other operating gains		-			29			68
Operating profit		756			1,309			1,942
Operating profit margin for ongoing businesses		12.7	%		13.8	%		14.5	%
Operating profit margin		11.3	%		13.0	%		14.4	%

Pro Forma Depreciation and Amortization of Computer Software Under IFRS

The following table sets forth our pro forma depreciation and amortization of computer software expense information for the six months ended June 30, 2008, nine months ended September 30, 2008 and year ended December 31, 2008.

(millions of U.S. dollars)	Six months ended June 30,        2008		Nine months ended September 30,     2008			Year ended   December 31, 2008
Legal		(125	)	(187	)		(250	)
Tax & Accounting		(27	)	(42	)		(57	)
Healthcare & Science		(28	)	(44	)		(62	)
Professional division		(180	)	(273	)		(369	)
Markets division		(314	)	(474	)		(635	)
Corporate and Other		(4	)	(13	)		(19	)
Disposals		(3	)	(3	)		(3	)
Total Depreciation and Amortization of Computer Software		(501	)	(763	)		(1,026	)

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APPENDIX C

QUARTERLY INFORMATION (UNAUDITED)

The following table presents a summary of quarterly consolidated operating results for Thomson Reuters.  Because our IFRS adoption is effective as of January 1, 2008, our 2007 quarterly information is presented on a Canadian GAAP basis. Accordingly, our quarterly information for 2009 and 2008 may not be comparable to that for 2007.

	Quarter ended March 31,						Quarter ended June 30,						Quarter ended September 30,						Quarter ended December 31,
(millions of U.S. dollars, except per share amounts)										2007						2007						2007
	2009 IFRS			2008 IFRS			2008 IFRS			Canadian GAAP			2008 IFRS			Canadian GAAP			2008 IFRS			Canadian GAAP
Revenues		3,131			1,840			3,133			1,805			3,339			1,796			3,395			2,033
Operating profit		376			228			254			352			553			310			633			410
Earnings from continuing operations		189			193			160			262			417			314			550			311
Earnings (loss) from discontinued operations, net of tax		4			2			(6	)		115			(11	)		2,655			16			123
Net earnings		193			195			154			377			406			2,969			566			434
Earnings attributable to common and ordinary shares		190			193			150			375			404			2,968			560			432
Dividends declared on preference shares		(1	)		(2	)		(1	)		(2	)		(1	)		(1	)		(1	)		(2	)
Basic earnings per share
From continuing operations	$	0.22		$	0.30		$	0.20		$	0.41		$	0.50		$	0.49		$	0.66		$	0.48
From discontinued operations		0.01			-			(0.01	)		0.18			(0.01	)		4.14			0.02			0.19
	$	0.23		$	0.30		$	0.19		$	0.59		$	0.49		$	4.63		$	0.68		$	0.67
Diluted earnings per share
From continuing operations	$	0.22		$	0.29		$	0.19		$	0.40		$	0.50		$	0.49		$	0.65		$	0.48
From discontinued operations		0.01			0.01			-			0.18			(0.01	)		4.12			0.02			0.19
	$	0.23		$	0.30		$	0.19		$	0.58		$	0.49		$	4.61		$	0.67		$	0.67

Prior to the acquisition of Reuters, our revenues and operating profits from continuing operations were proportionately the smallest in the first quarter and the largest in the fourth quarter, as certain product releases were concentrated at the end of the year, particularly in the regulatory and healthcare markets. Costs were incurred more evenly throughout the year. Our operating margins historically increased as the year progressed.  For these reasons, performance was not comparable quarter to consecutive quarter and was best considered on the basis of results for the whole year or by comparing results in a quarter with the results in the same quarter for the previous year. As Reuters revenues and profits have not historically fluctuated as significantly throughout the year, and because we disposed of our former Learning business in 2007, which was a highly seasonal business, the seasonality of our revenues and operating profits is now less pronounced. However, performance remains not comparable quarter to consecutive quarter and is best considered on the basis of results for the whole year or by comparing results in a quarter with the results in the same quarter for the previous year.

Results for Reuters are included in our financial statements as of April 17, 2008, the closing date of the acquisition, and reflect the continuing costs of our integration program thereafter.  All quarters ended prior to and including the quarter ended March 31, 2008 reflect the results of Thomson only.

In the quarter ended June 30, 2008, operating profit and earnings from continuing operations reflected an impairment of assets held for sale.  In the quarter ended March 31, 2008, operating profit and earnings reflected expenses associated with the Reuters transaction. In the quarter ended September 30, 2007, earnings from discontinued operations reflected a gain on the sale of Thomson Learning’s higher education, careers and library reference businesses.

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