For the month of July 2014
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Commission File Number: 1-31349
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THOMSON REUTERS CORPORATION
(Registrant)
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By:
|
/s/ Marc E. Gold
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Name: Marc E. Gold
|
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Title: Assistant Secretary
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Date: July 30, 2014
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Exhibit Number
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Description
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News release dated July 30, 2014 – Thomson Reuters Reports Second-Quarter 2014 Results
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![]() |
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![]() |
![]() |
· | Revenues from ongoing businesses grew 1% before currency to $3.2 billion |
· | Adjusted EBITDA grew 2% to $877 million with a margin of 27.8%, up 20 basis points from the prior-year period |
o | Excluding charges from both periods, adjusted EBITDA margin was 28.7%, up 80 basis points from the prior-year period |
· | Underlying operating profit grew 2% to $581 million with a margin of 18.4%, up 10 basis points from the prior-year period |
o | Excluding charges from both periods, underlying operating profit margin was 19.3%, up 70 basis points from the prior-year period |
· | Adjusted earnings per share were $0.51 versus $0.48 in the prior-year period |
· | Financial & Risk Q2 net sales positive |
· | Company completed $1.0 billion share buyback program announced last October and plans to repurchase up to an additional $1.0 billion of its shares by the end of 2015 |
· | 2014 Outlook affirmed |
|
Three Months Ended June 30,
(Millions of U.S. dollars, except EPS and margins)
|
|||||||||||
IFRS Financial Measures
|
2014
|
2013
|
Change
|
|||||||||
Revenues
|
$
|
3,159
|
$
|
3,163
|
0
|
%
|
||||||
Operating profit
|
$
|
381
|
$
|
597
|
-36
|
%
|
||||||
Diluted earnings per share (EPS)
|
$
|
0.31
|
$
|
0.30
|
3
|
%
|
||||||
Cash flow from operations
|
$
|
876
|
$
|
904
|
-3
|
%
|
Non-IFRS Financial Measures(1)
|
2014
|
2013
|
Change
|
|||||||||
Revenues from ongoing businesses
|
$
|
3,158
|
$
|
3,108
|
2
|
%
|
||||||
Adjusted EBITDA
|
$
|
877
|
$
|
858
|
2
|
%
|
||||||
Adjusted EBITDA margin
|
27.8
|
%
|
27.6
|
%
|
20
|
bp
|
||||||
Underlying operating profit
|
$
|
581
|
$
|
569
|
2
|
%
|
||||||
Underlying operating profit margin
|
18.4
|
%
|
18.3
|
%
|
10
|
bp
|
||||||
Adjusted earnings per share (EPS)
|
$
|
0.51
|
$
|
0.48
|
6
|
%
|
||||||
Free cash flow
|
$
|
652
|
$
|
732
|
-11
|
%
|
(1)
|
These and other non-IFRS financial measures are defined and reconciled to the most directly comparable IFRS measures in the tables appended to this news release. Additional information is provided in the explanatory footnotes to the appended tables.
|
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 2 of 15
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· | Revenues from ongoing businesses were $3.2 billion, a 1% increase before currency, reflecting 5% combined growth from the company’s Legal, Tax & Accounting and Intellectual Property & Science businesses, which was offset by a 2% decline in Financial & Risk. |
· | Adjusted EBITDA increased 2%, and the corresponding margin was 27.8% versus 27.6% in the prior-year period. The increase was primarily due to cost savings generated in the Financial & Risk business from the company’s simplification program announced in October 2013, which were partially offset by $30 million of charges incurred in the quarter. Excluding charges from both periods, adjusted EBITDA margin was 28.7%, up 80 basis points from the prior-year period. |
· | Underlying operating profit increased 2%, and the corresponding margin was 18.4% versus 18.3% in the prior-year period. The increase was primarily due to the same factors that impacted adjusted EBITDA. Excluding charges from both periods, underlying operating profit margin was 19.3%, up 70 basis points from the prior-year period. |
· | Adjusted EPS was $0.51 compared to $0.48 in the prior-year period, up 6%. |
· | Revenues were down 2% (down 3% organic) due to the impact of negative net sales over the prior 12 months and a decline in transactions-related revenues. |
· | Recurring subscription-related revenues decreased 2% (down 3% organic) due to the impact of negative net sales over the prior 12 months. |
· | Transactions-related revenues decreased 4% (down 11% organic) due to lower trading volumes related to lower volatility in the equity, foreign exchange and fixed income markets. Recoveries revenues were flat. |
· | By geography, revenues in Europe, Middle East and Africa (EMEA) were down 4%, revenues in the Americas were down 1% and revenues in Asia were up 1%. |
· | Net sales were positive for the quarter and were better than both the prior-year period and the first quarter of 2014. Net sales were positive for the Americas and Asia and remained negative in Europe. However, all three regions showed year-on-year improvements in their respective net sales performance. |
· | EBITDA increased 1%, primarily due to simplification program savings, despite $30 million of charges incurred in the quarter compared to $3 million in the prior-year period. The margin was 25.7% compared to 25.3% in the prior-year period. |
o | Excluding charges from both periods, EBITDA increased 8% with a margin of 27.6% compared to a margin of 25.5% in the prior-year period. |
· | Operating profit increased 2%. The margin was 16.1% compared to 15.7% in the prior-year period. |
o | Excluding charges from both periods, operating profit increased 13% with a margin of 17.9% compared to a margin of 15.8% in the prior-year period. |
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 3 of 15
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· | Revenues increased 1% (flat organic). Excluding US print, revenues grew 3% (2% organic). |
· | Solutions businesses (45% of Legal revenues) grew 6% (5% organic), driven by strong growth from Elite, Practical Law and FindLaw. Solutions businesses represent all of Legal’s revenue excluding US print and US online legal information. |
· | US online legal information (39% of Legal revenues) declined 1%. |
· | US print (16% of Legal revenues) declined 9%. |
· | EBITDA increased 2% primarily from savings programs. The margin was 38.9% compared to 38.5% in the prior-year period. |
· | Operating profit increased 2% with a margin of 30.7% versus 30.1% in the prior-year period. |
· | Revenues increased 14% (10% organic) driven by growth across the business. |
· | EBITDA increased 13% with a margin of 30.2%, flat compared to the prior-year period due to acquisition dilution and reinvestment in the business. |
· | Operating profit increased 14% and the margin was 20.1% compared to 19.8% in the prior-year period. |
· | Small movements in the timing of revenues and expenses can impact margins in any given quarter for the Tax & Accounting business. Full-year margins are more reflective of the segment’s underlying performance. |
· | Revenues increased 7% (5% organic), driven by recurring revenue growth of 10% (8% organic) partially offset by a 1% decline (down 3% organic) in transactions-related revenues. |
· | EBITDA increased 8% due to revenue flow-through. The margin was 33.9%, up 10 basis points compared to the prior-year period. |
· | Operating profit increased 5%. The margin was 24.7% compared to 25.2% in the prior-year period, down 50 basis points due to the dilutive impact of acquisitions in 2013. |
· | Small movements in the timing of revenues and expenses can impact margins in any given quarter for the Intellectual Property & Science business. Full-year margins are more reflective of the segment’s underlying performance. |
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 4 of 15
|
|
Six Months Ended June 30,
(Millions of U.S. dollars, except EPS and margins)
|
|||||||||||
IFRS Financial Measures
|
2014
|
2013
|
Change
|
|||||||||
Revenues
|
$
|
6,289
|
$
|
6,338
|
-1
|
%
|
||||||
Operating profit
|
$
|
740
|
$
|
987
|
-25
|
%
|
||||||
Diluted earnings per share (EPS)
|
$
|
0.65
|
$
|
0.26
|
150
|
%
|
||||||
Cash flow from operations
|
$
|
989
|
$
|
1,020
|
-3
|
%
|
Non-IFRS Financial Measures(1)
|
2014
|
2013
|
Change
|
|||||||||
Revenues from ongoing businesses
|
$
|
6,287
|
$
|
6,205
|
1
|
%
|
||||||
Adjusted EBITDA
|
$
|
1,697
|
$
|
1,615
|
5
|
%
|
||||||
Adjusted EBITDA margin
|
27.0
|
%
|
26.0
|
%
|
100
|
bp
|
||||||
Underlying operating profit
|
$
|
1,109
|
$
|
1,031
|
8
|
%
|
||||||
Underlying operating profit margin
|
17.6
|
%
|
16.6
|
%
|
100
|
bp
|
||||||
Adjusted earnings per share (EPS)
|
$
|
0.97
|
$
|
0.86
|
13
|
%
|
||||||
Free cash flow
|
$
|
517
|
$
|
501
|
3
|
%
|
· | Revenues from ongoing businesses were $6.3 billion, a 1% increase before currency. |
· | Adjusted EBITDA increased 5% and the corresponding margin was 27.0% versus 26.0% in the prior-year period. The increase was primarily due to simplification program savings in the Financial & Risk business and lower charges compared to the prior-year period. Charges for the six-month period were $40 million versus $87 million in the prior-year period. |
o | Excluding charges from both periods, adjusted EBITDA increased 2% and the related margin was 27.6% versus 27.4% in the prior-year period. |
· | Underlying operating profit increased 8% and the corresponding margin was 17.6% versus 16.6% in the prior-year period. The increase was primarily due to the same factors that impacted adjusted EBITDA. |
o | Excluding charges from both periods, underlying operating profit increased 3% and the related margin was 18.3% versus 18.0% in the prior-year period. |
· | Adjusted EPS was $0.97 compared to $0.86 in the prior-year period. |
· | Free cash flow was $517 million versus $501 million in the prior-year period. The increase was primarily due to the timing of capital expenditures partially offset by payments related to simplification program charges and a loss of free cash flow from disposals. For the full year, the company continues to expect to achieve free cash flow between $1.3 billion and $1.5 billion. |
(1)
|
These and other non-IFRS financial measures are defined and reconciled to the most directly comparable IFRS measures in the tables appended to this news release. Additional information is provided in the explanatory footnotes to the appended tables.
|
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 5 of 15
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· | revenues to be comparable to 2013; |
· | adjusted EBITDA margin to range between 26% and 27%; |
· | underlying operating profit margin to range between 17.0% and 18.0%; and |
· | free cash flow to range between $1.3 billion and $1.5 billion in 2014. |
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 6 of 15
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MEDIA
David Crundwell
Corporate Affairs
+1 646 223 5285
david.crundwell@thomsonreuters.com
|
INVESTORS
Frank J. Golden
Senior Vice President, Investor Relations
+1 646 223 5288
frank.golden@thomsonreuters.com
|
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 7 of 15
|
|
Three Months Ended
|
|||||||||||||||||||||||
|
June 30,
|
Change
|
||||||||||||||||||||||
|
2014
|
2013
|
Total
|
Before Currency
|
Organic
|
|||||||||||||||||||
Revenues
|
||||||||||||||||||||||||
Financial & Risk
|
$
|
1,655
|
$
|
1,660
|
0
|
%
|
-2
|
%
|
-3
|
%
|
||||||||||||||
Legal
|
850
|
846
|
1
|
%
|
1
|
%
|
0
|
%
|
||||||||||||||||
Tax & Accounting
|
324
|
288
|
13
|
%
|
14
|
%
|
10
|
%
|
||||||||||||||||
Intellectual Property & Science
|
251
|
234
|
7
|
%
|
7
|
%
|
5
|
%
|
||||||||||||||||
Corporate & Other (includes Reuters News)
|
82
|
82
|
0
|
%
|
-1
|
%
|
-1
|
%
|
||||||||||||||||
Eliminations
|
(4
|
)
|
(2
|
)
|
||||||||||||||||||||
Revenues from ongoing businesses (1)
|
3,158
|
3,108
|
2
|
%
|
1
|
%
|
0
|
%
|
||||||||||||||||
Other Businesses (2)
|
1
|
55
|
||||||||||||||||||||||
Revenues
|
$
|
3,159
|
$
|
3,163
|
0
|
%
|
|
Margin
|
|||||||||||||||||||||||
Adjusted EBITDA (3)
|
Change
|
2014
|
2013
|
Change
|
||||||||||||||||||||
Financial & Risk
|
$
|
426
|
$
|
420
|
1
|
%
|
25.7
|
%
|
25.3
|
%
|
40
|
bp
|
||||||||||||
Legal
|
331
|
326
|
2
|
%
|
38.9
|
%
|
38.5
|
%
|
40
|
bp
|
||||||||||||||
Tax & Accounting
|
98
|
87
|
13
|
%
|
30.2
|
%
|
30.2
|
%
|
0
|
bp
|
||||||||||||||
Intellectual Property & Science
|
85
|
79
|
8
|
%
|
33.9
|
%
|
33.8
|
%
|
10
|
bp
|
||||||||||||||
Corporate & Other (includes Reuters News)
|
(63
|
)
|
(54
|
)
|
||||||||||||||||||||
Adjusted EBITDA
|
$
|
877
|
$
|
858
|
2
|
%
|
27.8
|
%
|
27.6
|
%
|
20
|
bp
|
||||||||||||
|
||||||||||||||||||||||||
Underlying Operating Profit (4)
|
||||||||||||||||||||||||
Financial & Risk
|
$
|
266
|
$
|
260
|
2
|
%
|
16.1
|
%
|
15.7
|
%
|
40
|
bp
|
||||||||||||
Legal
|
261
|
255
|
2
|
%
|
30.7
|
%
|
30.1
|
%
|
60
|
bp
|
||||||||||||||
Tax & Accounting
|
65
|
57
|
14
|
%
|
20.1
|
%
|
19.8
|
%
|
30
|
bp
|
||||||||||||||
Intellectual Property & Science
|
62
|
59
|
5
|
%
|
24.7
|
%
|
25.2
|
%
|
-50
|
bp
|
||||||||||||||
Corporate & Other (includes Reuters News)
|
(73
|
)
|
(62
|
)
|
||||||||||||||||||||
Underlying operating profit
|
$
|
581
|
$
|
569
|
2
|
%
|
18.4
|
%
|
18.3
|
%
|
10
|
bp
|
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 8 of 15
|
|
Six Months Ended
|
|||||||||||||||||||||||
|
June 30,
|
Change
|
||||||||||||||||||||||
|
2014
|
2013
|
Total
|
Before Currency
|
Organic
|
|||||||||||||||||||
Revenues
|
||||||||||||||||||||||||
Financial & Risk
|
$
|
3,313
|
$
|
3,335
|
-1
|
%
|
-2
|
%
|
-3
|
%
|
||||||||||||||
Legal
|
1,653
|
1,640
|
1
|
%
|
1
|
%
|
0
|
%
|
||||||||||||||||
Tax & Accounting
|
672
|
605
|
11
|
%
|
13
|
%
|
10
|
%
|
||||||||||||||||
Intellectual Property & Science
|
494
|
467
|
6
|
%
|
6
|
%
|
4
|
%
|
||||||||||||||||
Corporate & Other (includes Reuters News)
|
161
|
163
|
-1
|
%
|
-1
|
%
|
-1
|
%
|
||||||||||||||||
Eliminations
|
(6
|
)
|
(5
|
)
|
||||||||||||||||||||
Revenues from ongoing businesses (1)
|
6,287
|
6,205
|
1
|
%
|
1
|
%
|
0
|
%
|
||||||||||||||||
Other Businesses (2)
|
2
|
133
|
||||||||||||||||||||||
Revenues
|
$
|
6,289
|
$
|
6,338
|
-1
|
%
|
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
|
Margin
|
|||||||||||||||||||||||
Adjusted EBITDA (3)
|
Change
|
2014
|
2013
|
Change
|
||||||||||||||||||||
Financial & Risk
|
$
|
825
|
$
|
780
|
6
|
%
|
24.9
|
%
|
23.4
|
%
|
150
|
bp
|
||||||||||||
Legal
|
615
|
602
|
2
|
%
|
37.2
|
%
|
36.7
|
%
|
50
|
bp
|
||||||||||||||
Tax & Accounting
|
213
|
185
|
15
|
%
|
31.7
|
%
|
30.6
|
%
|
110
|
bp
|
||||||||||||||
Intellectual Property & Science
|
157
|
149
|
5
|
%
|
31.8
|
%
|
31.9
|
%
|
-10
|
bp
|
||||||||||||||
Corporate & Other (includes Reuters News)
|
(113
|
)
|
(101
|
)
|
||||||||||||||||||||
Adjusted EBITDA
|
$
|
1,697
|
$
|
1,615
|
5
|
%
|
27.0
|
%
|
26.0
|
%
|
100
|
bp
|
||||||||||||
|
||||||||||||||||||||||||
Underlying Operating Profit (4)
|
||||||||||||||||||||||||
Financial & Risk
|
$
|
506
|
$
|
460
|
10
|
%
|
15.3
|
%
|
13.8
|
%
|
150
|
bp
|
||||||||||||
Legal
|
476
|
456
|
4
|
%
|
28.8
|
%
|
27.8
|
%
|
100
|
bp
|
||||||||||||||
Tax & Accounting
|
149
|
126
|
18
|
%
|
22.2
|
%
|
20.8
|
%
|
140
|
bp
|
||||||||||||||
Intellectual Property & Science
|
113
|
110
|
3
|
%
|
22.9
|
%
|
23.6
|
%
|
-70
|
bp
|
||||||||||||||
Corporate & Other (includes Reuters News)
|
(135
|
)
|
(121
|
)
|
||||||||||||||||||||
Underlying operating profit
|
$
|
1,109
|
$
|
1,031
|
8
|
%
|
17.6
|
%
|
16.6
|
%
|
100
|
bp
|
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 9 of 15
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||||||||||
|
June 30,
|
June 30,
|
||||||||||||||||||||||
|
2014
|
2013
|
Change
|
2014
|
2013
|
Change
|
||||||||||||||||||
|
||||||||||||||||||||||||
Operating profit
|
$
|
381
|
$
|
597
|
-36
|
%
|
$
|
740
|
$
|
987
|
-25
|
%
|
||||||||||||
Adjustments to remove:
|
||||||||||||||||||||||||
Amortization of other identifiable intangible assets
|
165
|
157
|
328
|
317
|
||||||||||||||||||||
Fair value adjustments
|
33
|
(29
|
)
|
35
|
(91
|
)
|
||||||||||||||||||
Other operating losses (gains), net
|
2
|
(136
|
)
|
5
|
(130
|
)
|
||||||||||||||||||
Operating (profit) loss from Other Businesses (2)
|
-
|
(20
|
)
|
1
|
(52
|
)
|
||||||||||||||||||
Underlying operating profit
|
$
|
581
|
$
|
569
|
2
|
%
|
$
|
1,109
|
$
|
1,031
|
8
|
%
|
||||||||||||
Remove: depreciation and amortization of computer
software (excluding Other Businesses (2))
|
296
|
289
|
588
|
584
|
||||||||||||||||||||
Adjusted EBITDA
|
$
|
877
|
$
|
858
|
2
|
%
|
$
|
1,697
|
$
|
1,615
|
5
|
%
|
||||||||||||
|
||||||||||||||||||||||||
Underlying operating profit margin (4)
|
18.4
|
%
|
18.3
|
%
|
10
|
bp
|
17.6
|
%
|
16.6
|
%
|
100
|
bp
|
||||||||||||
Adjusted EBITDA margin (3)
|
27.8
|
%
|
27.6
|
%
|
20
|
bp
|
27.0
|
%
|
26.0
|
%
|
100
|
bp
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||||||||||
|
June 30,
|
June 30,
|
||||||||||||||||||||||
|
2014
|
2013
|
Change
|
2014
|
2013
|
Change
|
||||||||||||||||||
|
||||||||||||||||||||||||
Earnings from continuing operations
|
$
|
260
|
$
|
256
|
2
|
%
|
$
|
552
|
$
|
239
|
131
|
%
|
||||||||||||
Adjustments to remove:
|
||||||||||||||||||||||||
Tax expense
|
40
|
209
|
27
|
456
|
||||||||||||||||||||
Other finance (income) costs
|
(29
|
)
|
17
|
(57
|
)
|
72
|
||||||||||||||||||
Net interest expense
|
111
|
124
|
219
|
239
|
||||||||||||||||||||
Amortization of other identifiable intangible assets
|
165
|
157
|
328
|
317
|
||||||||||||||||||||
Amortization of computer software
|
197
|
188
|
391
|
376
|
||||||||||||||||||||
Depreciation
|
99
|
101
|
197
|
208
|
||||||||||||||||||||
EBITDA
|
$
|
843
|
$
|
1,052
|
$
|
1,657
|
$
|
1,907
|
||||||||||||||||
Adjustments to remove:
|
||||||||||||||||||||||||
Share of post-tax earnings in equity method investments
|
(1
|
)
|
(9
|
)
|
(1
|
)
|
(19
|
)
|
||||||||||||||||
Other operating losses (gains), net
|
2
|
(136
|
)
|
5
|
(130
|
)
|
||||||||||||||||||
Fair value adjustments
|
33
|
(29
|
)
|
35
|
(91
|
)
|
||||||||||||||||||
EBITDA from Other Businesses (2)
|
-
|
(20
|
)
|
1
|
(52
|
)
|
||||||||||||||||||
Adjusted EBITDA
|
$
|
877
|
$
|
858
|
2
|
%
|
$
|
1,697
|
$
|
1,615
|
5
|
%
|
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 10 of 15
|
|
Three Months Ended
June 30, 2014
|
Three Months Ended
June 30, 2013
|
||||||||||||||||||||||
|
Underlying
Operating Profit
|
Add:
Depreciation
and
Amortization
of Computer Software **
|
Adjusted
EBITDA
|
Underlying
Operating Profit
|
Add:
Depreciation and Amortization of Computer Software **
|
Adjusted
EBITDA
|
||||||||||||||||||
|
||||||||||||||||||||||||
Financial & Risk
|
$
|
266
|
$
|
160
|
$
|
426
|
$
|
260
|
$
|
160
|
$
|
420
|
||||||||||||
Legal
|
261
|
70
|
331
|
255
|
71
|
326
|
||||||||||||||||||
Tax & Accounting
|
65
|
33
|
98
|
57
|
30
|
87
|
||||||||||||||||||
Intellectual Property & Science
|
62
|
23
|
85
|
59
|
20
|
79
|
||||||||||||||||||
Corporate & Other (includes Reuters News)
|
(73
|
)
|
10
|
(63
|
)
|
(62
|
)
|
8
|
(54
|
)
|
||||||||||||||
|
$
|
581
|
$
|
296
|
$
|
877
|
$
|
569
|
$
|
289
|
$
|
858
|
|
Six Months Ended
June 30, 2014
|
Six Months Ended
June 30, 2013
|
||||||||||||||||||||||
|
Underlying
Operating Profit
|
Add:
Depreciation
and
Amortization
of Computer Software **
|
Adjusted
EBITDA
|
Underlying
Operating Profit
|
Add:
Depreciation and Amortization of Computer Software **
|
Adjusted
EBITDA
|
||||||||||||||||||
|
||||||||||||||||||||||||
Financial & Risk
|
$
|
506
|
$
|
319
|
$
|
825
|
$
|
460
|
$
|
320
|
$
|
780
|
||||||||||||
Legal
|
476
|
139
|
615
|
456
|
146
|
602
|
||||||||||||||||||
Tax & Accounting
|
149
|
64
|
213
|
126
|
59
|
185
|
||||||||||||||||||
Intellectual Property & Science
|
113
|
44
|
157
|
110
|
39
|
149
|
||||||||||||||||||
Corporate & Other (includes Reuters News)
|
(135
|
)
|
22
|
(113
|
)
|
(121
|
)
|
20
|
(101
|
)
|
||||||||||||||
|
$
|
1,109
|
$
|
588
|
$
|
1,697
|
$
|
1,031
|
$
|
584
|
$
|
1,615
|
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 11 of 15
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
June 30,
|
June 30,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Earnings attributable to common shareholders
|
$
|
249
|
$
|
248
|
$
|
531
|
$
|
217
|
||||||||
Adjustments to remove:
|
||||||||||||||||
Operating (profit) loss from Other Businesses (2)
|
-
|
(20
|
)
|
1
|
(52
|
)
|
||||||||||
Fair value adjustments
|
33
|
(29
|
)
|
35
|
(91
|
)
|
||||||||||
Other operating losses (gains), net
|
2
|
(136
|
)
|
5
|
(130
|
)
|
||||||||||
Other finance (income) costs
|
(29
|
)
|
17
|
(57
|
)
|
72
|
||||||||||
Share of post-tax earnings in equity method investments
|
(1
|
)
|
(9
|
)
|
(1
|
)
|
(19
|
)
|
||||||||
Tax on above items
|
(4
|
)
|
36
|
(4
|
)
|
58
|
||||||||||
Discrete tax items
|
14
|
151
|
-
|
372
|
||||||||||||
Amortization of other identifiable intangible assets
|
165
|
157
|
328
|
317
|
||||||||||||
Discontinued operations
|
-
|
(6
|
)
|
-
|
(6
|
)
|
||||||||||
Interim period effective tax rate normalization (6)
|
7
|
19
|
(5
|
)
|
12
|
|||||||||||
Tax charge amortization (7)
|
(21
|
)
|
(24
|
)
|
(43
|
)
|
(32
|
)
|
||||||||
Dividends declared on preference shares
|
-
|
(1
|
)
|
(1
|
)
|
(2
|
)
|
|||||||||
Adjusted earnings
|
$
|
415
|
$
|
403
|
$
|
789
|
$
|
716
|
||||||||
Adjusted earnings per share
|
$
|
0.51
|
$
|
0.48
|
$
|
0.97
|
$
|
0.86
|
||||||||
|
||||||||||||||||
Diluted weighted-average common shares (millions)
|
813.4
|
832.5
|
817.3
|
831.5
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
June 30,
|
June 30,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Net cash provided by operating activities
|
$
|
876
|
$
|
904
|
$
|
989
|
$
|
1,020
|
||||||||
Capital expenditures, less proceeds from disposals
|
(225
|
)
|
(188
|
)
|
(473
|
)
|
(538
|
)
|
||||||||
Other investing activities
|
1
|
17
|
2
|
21
|
||||||||||||
Dividends paid on preference shares
|
-
|
(1
|
)
|
(1
|
)
|
(2
|
)
|
|||||||||
Free cash flow
|
652
|
732
|
517
|
501
|
||||||||||||
Remove: Other Businesses (2)
|
1
|
(59
|
)
|
1
|
(52
|
)
|
||||||||||
Free cash flow from ongoing businesses
|
$
|
653
|
$
|
673
|
$
|
518
|
$
|
449
|
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 12 of 15
|
(1) | Revenues from ongoing businesses are revenues from reportable segments and Corporate & Other (which includes Reuters News) less eliminations. Other Businesses (see note (2) below) are excluded. |
(2) | Other Businesses are businesses that have been or are expected to be exited through sale or closure that did not qualify for discontinued operations classification. |
(millions of U.S. dollars)
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
June 30,
|
June 30,
|
||||||||||||||
Other Businesses
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
|
||||||||||||||||
Revenues
|
$
|
1
|
$
|
55
|
$
|
2
|
$
|
133
|
||||||||
|
||||||||||||||||
Operating profit (loss)
|
-
|
$
|
20
|
$
|
(1
|
)
|
$
|
52
|
||||||||
Depreciation and amortization of computer software
|
-
|
-
|
-
|
-
|
||||||||||||
EBITDA
|
-
|
$
|
20
|
$
|
(1
|
)
|
$
|
52
|
(3) | Thomson Reuters defines adjusted EBITDA as underlying operating profit excluding the related depreciation and amortization of computer software. Adjusted EBITDA margin is adjusted EBITDA expressed as a percentage of revenues from ongoing businesses. |
(4) | Underlying operating profit is operating profit from reportable segments and Corporate & Other (includes Reuters News). Underlying operating profit margin is the underlying operating profit expressed as a percentage of revenues from ongoing businesses. |
(5) | Adjusted earnings and adjusted earnings per share include dividends declared on preference shares and amortization of the 2013 tax charges associated with the consolidation of technology and content assets but exclude the pre-tax impacts of amortization of other identifiable intangible assets as well as the post-tax impacts of fair value adjustments, other operating (gains) and losses, certain impairment charges, the results of Other Businesses (see note (2) above), other finance (income) costs, Thomson Reuters share of post-tax (earnings) losses in equity method investments, discontinued operations and other items affecting comparability. Adjusted earnings per share is calculated using diluted weighted-average shares and does not represent actual earnings or loss per share attributable to shareholders. |
(6) | Adjustment to reflect income taxes based on estimated full-year effective tax rate. Reported earnings or loss for interim periods reflect income taxes based on the estimated effective tax rates of each of the jurisdictions in which Thomson Reuters operates. The adjustment reallocates estimated full-year income taxes between interim periods, but has no effect on full-year income taxes. |
(7) | Reflects amortization of the 2013 tax charges associated with the consolidation of the ownership and management of technology and content assets. For the non-IFRS measure, the majority of the charges are amortized over seven years, the period over which the tax is expected to be paid. |
(8) | Free cash flow is net cash provided by operating activities less capital expenditures, other investing activities and dividends paid on the company’s preference shares. Other Businesses (see note (2) above) are also removed to arrive at free cash flow from ongoing businesses. |
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 13 of 15
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
June 30,
|
June 30,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
|
||||||||||||||||
Revenues
|
$
|
3,159
|
$
|
3,163
|
$
|
6,289
|
$
|
6,338
|
||||||||
Operating expenses
|
(2,315
|
)
|
(2,256
|
)
|
(4,628
|
)
|
(4,580
|
)
|
||||||||
Depreciation
|
(99
|
)
|
(101
|
)
|
(197
|
)
|
(208
|
)
|
||||||||
Amortization of computer software
|
(197
|
)
|
(188
|
)
|
(391
|
)
|
(376
|
)
|
||||||||
Amortization of other identifiable intangible assets
|
(165
|
)
|
(157
|
)
|
(328
|
)
|
(317
|
)
|
||||||||
Other operating (losses) gains, net
|
(2
|
)
|
136
|
(5
|
)
|
130
|
||||||||||
Operating profit
|
381
|
597
|
740
|
987
|
||||||||||||
Finance costs, net:
|
||||||||||||||||
Net interest expense
|
(111
|
)
|
(124
|
)
|
(219
|
)
|
(239
|
)
|
||||||||
Other finance income (costs)
|
29
|
(17
|
)
|
57
|
(72
|
)
|
||||||||||
Income before tax and equity method investments
|
299
|
456
|
578
|
676
|
||||||||||||
Share of post-tax earnings in equity method investments
|
1
|
9
|
1
|
19
|
||||||||||||
Tax expense
|
(40
|
)
|
(209
|
)
|
(27
|
)
|
(456
|
)
|
||||||||
Earnings from continuing operations
|
260
|
256
|
552
|
239
|
||||||||||||
Earnings from discontinued operations, net of tax
|
-
|
6
|
-
|
6
|
||||||||||||
Net earnings
|
$
|
260
|
$
|
262
|
$
|
552
|
$
|
245
|
||||||||
|
||||||||||||||||
Earnings attributable to:
|
||||||||||||||||
Common shareholders
|
249
|
248
|
531
|
217
|
||||||||||||
Non-controlling interests
|
11
|
14
|
21
|
28
|
||||||||||||
|
||||||||||||||||
Basic and diluted earnings per share
|
$
|
0.31
|
$
|
0.30
|
$
|
0.65
|
$
|
0.26
|
||||||||
|
||||||||||||||||
Basic weighted-average common shares
|
809,941,274
|
829,921,311
|
813,910,056
|
829,136,505
|
||||||||||||
Diluted weighted-average common shares
|
813,363,597
|
832,509,774
|
817,255,753
|
831,453,225
|
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 14 of 15
|
June 30,
|
December 31,
|
|||||||
|
2014
|
2013
|
||||||
Assets
|
||||||||
Cash and cash equivalents
|
$
|
704
|
$
|
1,316
|
||||
Trade and other receivables
|
1,798
|
1,751
|
||||||
Other financial assets
|
143
|
183
|
||||||
Prepaid expenses and other current assets
|
590
|
650
|
||||||
Current assets
|
3,235
|
3,900
|
||||||
|
||||||||
Computer hardware and other property, net
|
1,224
|
1,291
|
||||||
Computer software, net
|
1,566
|
1,622
|
||||||
Other identifiable intangible assets, net
|
7,639
|
7,890
|
||||||
Goodwill
|
17,060
|
16,871
|
||||||
Other financial assets
|
181
|
192
|
||||||
Other non-current assets
|
603
|
583
|
||||||
Deferred tax
|
70
|
90
|
||||||
Total assets
|
$
|
31,578
|
$
|
32,439
|
||||
|
||||||||
Liabilities and equity
|
||||||||
Liabilities
|
||||||||
Current indebtedness
|
$
|
591
|
$
|
596
|
||||
Payables, accruals and provisions
|
2,074
|
2,624
|
||||||
Deferred revenue
|
1,429
|
1,348
|
||||||
Other financial liabilities
|
143
|
193
|
||||||
Current liabilities
|
4,237
|
4,761
|
||||||
|
||||||||
Long-term indebtedness
|
7,467
|
7,470
|
||||||
Provisions and other non-current liabilities
|
1,814
|
1,759
|
||||||
Other financial liabilities
|
142
|
102
|
||||||
Deferred tax
|
1,801
|
1,917
|
||||||
Total liabilities
|
15,461
|
16,009
|
||||||
|
||||||||
Equity
|
||||||||
Capital
|
10,208
|
10,347
|
||||||
Retained earnings
|
6,914
|
7,303
|
||||||
Accumulated other comprehensive loss
|
(1,477
|
)
|
(1,614
|
)
|
||||
Total shareholders’ equity
|
15,645
|
16,036
|
||||||
Non-controlling interests
|
472
|
394
|
||||||
Total equity
|
16,117
|
16,430
|
||||||
Total liabilities and equity
|
$
|
31,578
|
$
|
32,439
|
![]() |
|
Thomson Reuters Reports Second-Quarter 2014 Results
|
Page 15 of 15
|
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
||||||||||||||
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Cash provided by (used in):
|
||||||||||||||||
Operating activities
|
||||||||||||||||
Net earnings
|
$
|
260
|
$
|
262
|
$
|
552
|
$
|
245
|
||||||||
Adjustments for:
|
||||||||||||||||
Depreciation
|
99
|
101
|
197
|
208
|
||||||||||||
Amortization of computer software
|
197
|
188
|
391
|
376
|
||||||||||||
Amortization of other identifiable intangible assets
|
165
|
157
|
328
|
317
|
||||||||||||
Net (gains) losses on disposals of businesses and investments
|
-
|
(142
|
)
|
1
|
(156
|
)
|
||||||||||
Deferred tax
|
(35
|
)
|
70
|
(75
|
)
|
242
|
||||||||||
Other
|
77
|
60
|
111
|
125
|
||||||||||||
Changes in working capital and other items
|
113
|
208
|
(516
|
)
|
(337
|
)
|
||||||||||
Net cash provided by operating activities
|
876
|
904
|
989
|
1,020
|
||||||||||||
|
||||||||||||||||
Investing activities
|
||||||||||||||||
Acquisitions, net of cash acquired
|
(137
|
)
|
(118
|
)
|
(137
|
)
|
(848
|
)
|
||||||||
Proceeds from disposals of businesses and investments,
net of taxes paid
|
12
|
322
|
12
|
352
|
||||||||||||
Capital expenditures, less proceeds from disposals
|
(225
|
)
|
(188
|
)
|
(473
|
)
|
(538
|
)
|
||||||||
Other investing activities
|
1
|
17
|
2
|
21
|
||||||||||||
Net cash (used in) provided by investing activities
|
(349
|
)
|
33
|
(596
|
)
|
(1,013
|
)
|
|||||||||
|
||||||||||||||||
Financing activities
|
||||||||||||||||
Proceeds from debt
|
-
|
854
|
-
|
1,294
|
||||||||||||
Repayments of debt
|
-
|
-
|
-
|
(440
|
)
|
|||||||||||
Net repayments under short-term loan facilities
|
-
|
(327
|
)
|
-
|
-
|
|||||||||||
Repurchases of common shares
|
(353
|
)
|
-
|
(617
|
)
|
-
|
||||||||||
Dividends paid on preference shares
|
-
|
(1
|
)
|
(1
|
)
|
(2
|
)
|
|||||||||
Dividends paid on common shares
|
(258
|
)
|
(260
|
)
|
(520
|
)
|
(519
|
)
|
||||||||
Other financing activities
|
125
|
(2
|
)
|
129
|
7
|
|||||||||||
Net cash (used in) provided by financing activities
|
(486
|
)
|
264
|
(1,009
|
)
|
340
|
||||||||||
Increase (decrease) in cash and bank overdrafts
|
41
|
1,201
|
(616
|
)
|
347
|
|||||||||||
Translation adjustments
|
3
|
(6
|
)
|
3
|
(17
|
)
|
||||||||||
Cash and bank overdrafts at beginning of period
|
655
|
411
|
1,312
|
1,276
|
||||||||||||
Cash and bank overdrafts at end of period
|
$
|
699
|
$
|
1,606
|
$
|
699
|
$
|
1,606
|
||||||||
|
||||||||||||||||
Cash and bank overdrafts at end of period comprised of:
|
||||||||||||||||
Cash and cash equivalents
|
$
|
704
|
$
|
1,613
|
$
|
704
|
$
|
1,613
|
||||||||
Bank overdrafts
|
(5
|
)
|
(7
|
)
|
(5
|
)
|
(7
|
)
|
||||||||
|
$
|
699
|
$
|
1,606
|
$
|
699
|
$
|
1,606
|