News and financial data provider Thomson Reuters Corp. (TRI,TRI.TO) said Thursday that its third quarter profit fell 59% from last year, hurt by lower revenue and charges.
The New York-based company reported net income for the third quarter of $167 million or $0.19 per share, compared to $406 million or $0.49 per share for the year-ago quarter.
Adjusted earnings from continuing operations for the third quarter was $359 million or $0.43 per share, compared to $392 million or $0.47 per share in the prior year quarter.
Operating profit for the quarter fell 32% to $378 million from $553 million a year ago, while underlying operating profit grew 3% to $711 million from $690 million last year.
Revenue for the third quarter fell 3.6% to $3.22 billion from $3.34 billion in the same quarter last year. Excluding the impact of foreign exchange rates, third quarter revenue declined 2% year-over-year.
"While the weak year-to-date net sales experienced in recent quarters are now flowing through into revenues, we expect this dip to be shallow and limited to the next few quarters," said Thomas Glocer, chief executive officer of Thomson Reuters.
Thomson Reuters was created through the April 2008 merger of Thomson Corp. and Reuters Group Plc.
Thomson Reuters completed the unification of its dual listed company structure on September 10 after receiving both shareholders as well as UK court approval. As a result, the company's common shares now have a primary listing on the Toronto Stock Exchange, and are also listed on the New York Stock Exchange.
The company said Thursday that it has achieved combined run-rate savings of $975 million as at September 30. The company continues to expect to achieve at least $1.0 billion of run-rate savings by year-end 2009. Savings were principally achieved through elimination of redundant positions and the retirement of legacy products.
Third quarter revenue from the company's markets division, which serves financial institutions, fell 6% to $1.86 billion. Excluding currency adjustments, revenue declined 4%. Revenues in Asia were unchanged against the prior year period while revenues in Europe, Middle East and Africa and the Americas were down 3% and 6%, respectively.
Third quarter revenue from the company's professional division, which sells databases and other deep information reservoirs to lawyers, accountants, scientists and the healthcare industry, declined 0.4% to $1.36 billion. Excluding currency adjustments, revenue rose 2%, with with strong growth in Tax & Accounting, Healthcare & Science and Legal's recurring subscription businesses.
For the first nine months, the company reported net income of $685 million or $0.80 per share, compared to $755 million or $0.98 per share for the same period last year.
Adjusted earnings from continuing operations for the nine-month period was $1.2 billion or $1.41 per share, compared to $1.1 billion or $1.31 per share in the corresponding year-ago period.
Revenue for the nine-month period increased to $9.64 million from $8.31 million in the prior year period.
Thomson Reuters also reaffirmed its previous guidance that revenues are expected to grow in 2009 and underlying operating profit margin and free cash flow will be comparable with 2008.
Additionally, the company said it will pay a quarterly dividend of $0.28 per share on December 15 to shareholders of record on November 20.
Early last month, Thomson Reuters completed the acquisition of the Abacus Enterprise suite of products and related business operations from Deloitte LLP. Also last month, the company made an offer to buy privately-held provider of online financial commentary Breakingviews. The deal is expected to be complete within eight weeks.
Thomson Reuters shares are currently trading at $32.03, down 32 cents. On the TSX, the company's shares are currently trading at C$34.17, down C$0.35 or 1.01%.
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