TORONTO, Aug. 5, 2021 /PRNewswire/ -- Thomson Reuters
(TSX/NYSE: TRI) today reported results for the second quarter ended
June 30, 2021:
- Total company revenue grew 9% and organic revenue grew 7%;
- Raised full-year 2021 total company and "Big 3" guidance for
revenue growth, adjusted EBITDA margin and free cash flow;
- Outlook provided for the third quarter of 2021;
- Change Program on track - achieved $90
million of run-rate operating expense savings through
June 30;
- New $1.2 billion buyback program
announced.
"The strong results that we achieved in the first quarter
accelerated in the second quarter. Our performance was consistent
across the company, above our expectations, and positions us well
for the rest of the year and 2022. These results reflect the
confidence of our customers – in both an improving economic
environment and in their prospects. This dynamic presents us with a
tailwind as customers are spending on products and solutions that
fit their workflows and improve their professional lives, which are
rapidly evolving," said Steve
Hasker, president and CEO of Thomson Reuters.
Mr. Hasker added, "Based on the strong first-half performance
and our confidence in the trajectory of the business for second
half of the year, we have increased our full-year 2021
guidance."
Consolidated Financial Highlights - Three Months Ended
June 30
Three Months Ended
June 30,
(Millions of U.S.
dollars, except for adjusted EBITDA margin and EPS)
(unaudited)
|
IFRS Financial
Measures(1)
|
2021
|
2020
|
Change
|
Change at
Constant
Currency
|
Revenues
|
$1,532
|
$1,405
|
9%
|
|
Operating
profit
|
$316
|
$365
|
-14%
|
|
Diluted earnings per
share (EPS)
|
$2.15
|
$0.25
|
n/m
|
|
Cash flow from
operations
|
$462
|
$422
|
10%
|
|
Non-IFRS Financial
Measures(1)
|
|
|
|
|
Revenues
|
$1,532
|
$1,405
|
9%
|
7%
|
Adjusted
EBITDA
|
$502
|
$479
|
5%
|
5%
|
Adjusted EBITDA
margin
|
32.7%
|
34.1%
|
-140bp
|
-70bp
|
Adjusted
EPS
|
$0.48
|
$0.44
|
9%
|
9%
|
Free cash
flow
|
$379
|
$305
|
25%
|
|
(1) In addition to results reported in
accordance with International Financial Reporting Standards (IFRS),
the company uses certain non-IFRS financial measures as
supplemental indicators of its operating performance and financial
position. 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.
n/m: not meaningful
|
Revenues increased 9%, driven by growth across all of the
company's customer segments and a 2% favorable impact from foreign
currency.
- Organic revenues increased 7%, driven by 5% growth in recurring
revenues (79% of total revenues), as well as growth in
transactions, Reuters News and Global Print revenues, which
benefited from a favorable comparison to the second quarter of 2020
when the early stages of the COVID-19 pandemic negatively impacted
results.
- The company's "Big 3" segments (Legal Professionals, Corporates
and Tax & Accounting Professionals), which collectively
comprised 80% of total revenues, reported organic revenue growth of
7%.
Operating profit decreased 14% as the prior-year period
included a significant benefit from the revaluation of warrants
that the company previously held in Refinitiv, which was sold to
London Stock Exchange Group (LSEG) in January 2021.
- Adjusted EBITDA, which excludes the impact of the
warrant revaluation, among other items, increased 5% as higher
revenues more than offset higher costs, which included costs
associated with the company's Change Program. The related margin
decreased to 32.7% from 34.1% in the prior-year period due to
higher costs. Adjusted EBITDA margin was negatively impacted by
270bp due to Change Program costs. Additional information
regarding the Change Program is provided later in this news
release.
Diluted EPS increased to $2.15 per share from $0.25 per share in the prior-year period due to
an increase in the value of the company's LSEG investment.
- Adjusted EPS, which excludes the increase in value of
the company's LSEG investment, as well as other adjustments,
increased to $0.48 per share from
$0.44 per share in the prior-year
period, primarily due to higher adjusted EBITDA.
Cash flow from operations increased as higher revenues
and favorable movements in working capital more than offset higher
tax payments and expenses, which included Change Program costs.
- Free cash flow increased due to higher cash flows
from operations and a dividend of $51
million paid by LSEG in the second quarter.
Highlights by Customer Segment - Three Months Ended
June 30
(Millions of U.S.
dollars, except for adjusted EBITDA margins)
(unaudited)
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
June
30,
|
|
Change
|
|
|
2021
|
2020
|
|
Total
|
Constant
Currency
|
Organic(1)
|
Revenues
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$673
|
$620
|
|
9%
|
7%
|
6%
|
Corporates
|
|
348
|
329
|
|
6%
|
4%
|
4%
|
Tax &
Accounting Professionals
|
|
197
|
168
|
|
17%
|
15%
|
15%
|
"Big 3" Segments
Combined
|
|
1,218
|
1,117
|
|
9%
|
7%
|
7%
|
Reuters
News
|
|
168
|
155
|
|
9%
|
6%
|
6%
|
Global
Print
|
|
147
|
134
|
|
9%
|
6%
|
6%
|
Eliminations/Rounding
|
|
(1)
|
(1)
|
|
|
|
|
Revenues
|
|
$1,532
|
$1,405
|
|
9%
|
7%
|
7%
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$285
|
$254
|
|
12%
|
10%
|
|
Corporates
|
|
130
|
118
|
|
10%
|
9%
|
|
Tax &
Accounting Professionals
|
|
72
|
54
|
|
32%
|
32%
|
|
"Big 3" Segments
Combined
|
|
487
|
426
|
|
14%
|
13%
|
|
Reuters
News
|
|
35
|
25
|
|
45%
|
66%
|
|
Global
Print
|
|
56
|
54
|
|
2%
|
-1%
|
|
Corporate
costs
|
|
(76)
|
(26)
|
|
n/a
|
n/a
|
|
Adjusted
EBITDA
|
|
$502
|
$479
|
|
5%
|
5%
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
42.3%
|
40.9%
|
|
140bp
|
140bp
|
|
Corporates
|
|
37.2%
|
35.9%
|
|
130bp
|
160bp
|
|
Tax &
Accounting Professionals
|
|
36.2%
|
31.9%
|
|
430bp
|
450bp
|
|
"Big 3" Segments
Combined
|
|
39.9%
|
38.1%
|
|
180bp
|
190bp
|
|
Reuters
News
|
|
20.8%
|
15.6%
|
|
520bp
|
820bp
|
|
Global
Print
|
|
37.9%
|
40.5%
|
|
-260bp
|
-280bp
|
|
Corporate
costs
|
|
n/a
|
n/a
|
|
n/a
|
n/a
|
|
Adjusted EBITDA
margin
|
|
32.7%
|
34.1%
|
|
-140bp
|
-70bp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
n/a: not
applicable
(1) Computed for
revenue growth only.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unless otherwise noted, all revenue growth comparisons by
customer segment in this news release are at constant
currency (or exclude the impact of foreign currency) as
Thomson Reuters believes this provides the best basis to measure
their performance.
Legal Professionals
Revenues increased 7% (6% organic) to $673 million.
- Recurring revenues grew 6% (93% of total, all organic),
primarily due to strong performances from Practical Law, Westlaw
Edge and the Government business as well as strong contributions
from FindLaw, and the company's Canada, Europe and Asia businesses, each of which grew mid to
upper single digits in the quarter.
- Transactions revenues grew 14% (7% of total, all organic),
primarily due to the Government business.
Adjusted EBITDA increased 12% to $285 million.
- The margin increased to 42.3% from 40.9%, primarily due to
higher revenues.
Corporates
Revenues increased 4% (all organic) to $348 million, primarily due to strong recurring
revenue growth, including strong growth from legal solutions and
the company's Latin America and
Asia businesses.
- Recurring revenues grew 5% (86% of total, all organic).
- Transactions revenues grew 1% (14% of total, all organic),
primarily related to increasing demand for solutions provided by
the Indirect Tax business.
Adjusted EBITDA increased 10% to $130 million.
- The margin increased to 37.2% from 35.9%, primarily due to
higher revenues.
Tax & Accounting Professionals
Revenues increased 15% (all organic) to $197 million, reflecting transactions revenue
growth of 43% related to the 2021 extension of the U.S. federal tax
filing deadline. Additionally, revenue growth benefited from a
similar shift in 2020 when transactions revenues moved from the
second quarter to the third quarter after the U.S. federal tax
filing deadline was extended from April to July. Normalizing for
the shift in the U.S. federal tax filing deadline, organic revenues
grew 10%.
- Recurring revenues grew 9% (76% of total, all organic),
including strong growth from the company's Latin American
businesses.
- Transactions revenues grew 43% (24% of total, all organic),
primarily due to shifts in timing of Pay-Per-Return tax filings and
audit products.
Adjusted EBITDA increased 32% to $72 million.
- The margin increased to 36.2% from 31.9%, primarily due to
higher revenues.
- The Tax & Accounting Professionals segment is the company's
most seasonal business with approximately 60% of full-year revenues
typically generated in the first and fourth quarters. As a result,
the margin performance of this segment has been generally higher in
the first and fourth quarters as costs are typically incurred in a
more linear fashion throughout the year.
Reuters News
Revenues of $168
million increased 6%, all organic, primarily due to the
segment's professional business, which had strong growth from
Reuters Events, whose performance was negatively impacted by
COVID-19 in 2020.
- Reuters Events continues to hold all events virtually and
continues to assess when in-person events can resume based on local
health guidelines and feedback from customers.
Adjusted EBITDA increased 45% to $35 million, primarily due to revenue growth.
Global Print
Revenues increased 6% to $147
million, driven by higher third-party revenues for printing
services and an increase in shipments, reflecting a gradual return
to office by large and mid-sized law firms. The quarter's
performance also reflected a favorable comparison to the second
quarter of 2020 when shipments were delayed at the beginning of the
COVID-19 pandemic.
- Global Print's third-quarter revenues are forecast to decline
between 5% and 8%.
- Global Print's full-year 2021 revenues are forecast to decline
between 4% and 7%.
Adjusted EBITDA increased 2% to $56 million.
- The margin decreased to 37.9% from 40.5% due to higher
costs.
Corporate Costs
Corporate costs at the adjusted EBITDA level were
$76 million, which included
$41 million of Change Program costs,
compared to $26 million of Corporate
costs in the prior-year period. Additional information regarding
the Change Program is provided below.
Consolidated Financial Highlights - Six Months Ended
June 30
Six Months Ended
June 30,
(Millions of U.S.
dollars, except for adjusted EBITDA margin and EPS)
(unaudited)
|
IFRS Financial
Measures(1)
|
2021
|
2020
|
Change
|
Change at
Constant
Currency
|
Revenues
|
$3,112
|
$2,925
|
6%
|
|
Operating
profit
|
$703
|
$655
|
7%
|
|
Diluted earnings per
share (EPS)
|
$12.28
|
$0.64
|
n/m
|
|
Cash flow from
operations
|
$842
|
$598
|
41%
|
|
Non-IFRS Financial
Measures(1)
|
|
|
|
|
Revenues
|
$3,112
|
$2,925
|
6%
|
5%
|
Adjusted
EBITDA
|
$1,060
|
$959
|
11%
|
10%
|
Adjusted EBITDA
margin
|
34.1%
|
32.8%
|
130bp
|
160bp
|
Adjusted
EPS
|
$1.06
|
$0.92
|
15%
|
15%
|
Free cash
flow
|
$618
|
$340
|
82%
|
|
(1) In addition to results
reported in accordance with IFRS, the company uses certain non-IFRS
financial measures as supplemental indicators of its operating
performance and financial position. 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.
n/m:
not meaningful
|
Revenues increased 6% due to growth in recurring revenues
and a 1% favorable impact from foreign currency.
- Organic revenues increased 5%, driven by 4% growth in recurring
revenues, which comprised 79% of total revenues, and higher
transactions revenues.
- The company's "Big 3" segments, which collectively comprised
80% of total revenues, reported organic revenue growth of 6%.
Operating profit increased 7% as higher revenues more
than offset higher costs, which included Change Program costs.
- Adjusted EBITDA increased 11% reflecting the same
factors that impacted operating profit. The related margin
increased to 34.1% from 32.8% in the prior-year period. Adjusted
EBITDA margin was negatively impacted by 160bp due to Change
Program costs.
Diluted EPS increased to $12.28 per share from $0.64 per share in the prior-year period due to
the gain on the sale of Refinitiv to LSEG in January 2021.
- Adjusted EPS, which excludes the gain on the sale of
Refinitiv, as well as other adjustments, increased to $1.06 per share from $0.92 per share in the prior-year period,
primarily due to higher adjusted EBITDA.
Cash flow from operations increased as higher revenues
and favorable movements in working capital (including lower annual
incentive bonus payments, which were due to the impact of COVID-19
in 2020) more than offset higher tax payments and expenses, which
included Change Program costs.
- Free cash flow increased due to higher cash flows
from operations and the dividend paid by LSEG previously
noted.
Highlights by Customer Segment - Six Months Ended
June 30
(Millions of U.S.
dollars, except for adjusted EBITDA margins)
(unaudited)
|
|
|
Six Months
Ended
|
|
|
|
|
|
|
June 30,
|
|
Change
|
|
|
2021
|
2020
|
|
Total
|
Constant
Currency
|
Organic(1)
|
Revenues
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$1,341
|
$1,246
|
|
8%
|
6%
|
6%
|
Corporates
|
|
732
|
696
|
|
5%
|
4%
|
4%
|
Tax &
Accounting Professionals
|
|
422
|
386
|
|
9%
|
9%
|
9%
|
"Big 3" Segments
Combined
|
|
2,495
|
2,328
|
|
7%
|
6%
|
6%
|
Reuters
News
|
|
328
|
310
|
|
6%
|
4%
|
4%
|
Global
Print
|
|
290
|
289
|
|
0%
|
-2%
|
-2%
|
Eliminations/Rounding
|
|
(1)
|
(2)
|
|
|
|
|
Revenues
|
|
$3,112
|
$2,925
|
|
6%
|
5%
|
5%
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$564
|
$484
|
|
17%
|
14%
|
|
Corporates
|
|
276
|
235
|
|
17%
|
17%
|
|
Tax &
Accounting Professionals
|
|
170
|
138
|
|
23%
|
23%
|
|
"Big 3" Segments
Combined
|
|
1,010
|
857
|
|
18%
|
16%
|
|
Reuters
News
|
|
63
|
44
|
|
45%
|
65%
|
|
Global
Print
|
|
113
|
117
|
|
-4%
|
-6%
|
|
Corporate
costs
|
|
(126)
|
(59)
|
|
n/a
|
n/a
|
|
Adjusted
EBITDA
|
|
$1,060
|
$959
|
|
11%
|
10%
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
42.1%
|
38.8%
|
|
330bp
|
300bp
|
|
Corporates
|
|
37.7%
|
33.8%
|
|
390bp
|
410bp
|
|
Tax &
Accounting Professionals
|
|
40.2%
|
35.7%
|
|
450bp
|
440bp
|
|
"Big 3" Segments
Combined
|
|
40.5%
|
36.8%
|
|
370bp
|
350bp
|
|
Reuters
News
|
|
19.2%
|
14.1%
|
|
510bp
|
780bp
|
|
Global
Print
|
|
38.9%
|
40.5%
|
|
-160bp
|
-190bp
|
|
Corporate
costs
|
|
n/a
|
n/a
|
|
n/a
|
n/a
|
|
Adjusted EBITDA
margin
|
|
34.1%
|
32.8%
|
|
130bp
|
160bp
|
|
|
|
|
|
|
|
|
|
n/a: not
applicable
(1) Computed for
revenue growth only.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thomson Reuters Change Program and Outlook
In February 2021, the company
announced a two-year Change Program to transition from a holding
company to an operating company, and from a content provider to a
content-driven technology company. The program is expected to take
24 months (2021-2022) to largely complete and is projected to
require an investment of between $500
million and $600 million
during the course of that time. The company's 2021, 2022 and 2023
outlook is appended to this release.
The company's outlook for 2021, 2022 and 2023 incorporates the
forecasted impacts associated with the Change Program, assumes
constant currency rates, and excludes the impact of any future
acquisitions or dispositions that may occur during those periods.
Thomson Reuters believes that this type of guidance provides useful
insight into the performance of its businesses.
While the company's second-quarter 2021 performance provides it
with increasing confidence about its outlook, the global economy
continues to experience substantial disruption due to concerns
regarding resurgences and new strains of COVID-19, as well as from
the measures intended to mitigate its impact. Any worsening of the
global economic or business environment could impact the company's
ability to achieve its outlook.
Today, the company provided an outlook for the third quarter of
2021 and updated its full-year outlook for 2021, which are
reflected in the table below. The company also reaffirmed its
outlook for 2022 and 2023.
Third-Quarter 2021 Outlook
- Total company revenues and total organic revenues are expected
to increase between 3.5% and 4.0%.
- "Big 3" total revenue growth and organic revenue growth are
forecast to range between 5.0% and 5.5%.
- Tax & Accounting Professionals revenue growth is forecast
to increase low single digits.
- Reuters News revenues are expected to increase between 2.0% and
3.0%.
- Global Print revenues are expected to decline between 5.0% and
8.0%.
Third-Quarter 2021 Outlook and update to Full-Year 2021
Outlook
Total Thomson
Reuters
|
Q3
2021 Outlook
|
Original
FY
2021
Outlook
(February 23,
2021)
|
FY
2021
Outlook
Update
(May 4,
2021)
|
FY
2021
Outlook
Update
(August 5,
2021)
|
Total Revenue
Growth
|
3.5% -
4.0%
|
3.0% -
4.0%
|
3.5% -
4.0%
|
4.0% -
4.5%
|
Organic Revenue
Growth
|
3.5% -
4.0%
|
3.0% -
4.0%
|
3.5% -
4.0%
|
4.0% -
4.5%
|
Adjusted EBITDA
Margin
|
-
|
30% - 31%
|
Unchanged
|
31% - 32%
|
Corporate
Costs
Core Corporate
Costs
Change Program Operating
Expenses
|
-
|
$305 - $340
million
$130 - $140
million
$175 - $200
million
|
Unchanged
|
Unchanged
|
Free Cash
Flow
|
-
|
$1.0 - $1.1
billion
|
Unchanged
|
$1.1 - $1.2
billion
|
Capital Expenditures
- % of Revenue
Change Program Capital
Expenditures
|
-
|
9.0% -
9.5%
$125 - $150
million
|
Unchanged
|
Unchanged
|
Depreciation &
Amortization of
Computer
Software
|
-
|
$650 - $675
million
|
Unchanged
|
Unchanged
|
Interest Expense
(P&L)
|
-
|
$190 - $210
million
|
Unchanged
|
Unchanged
|
Effective Tax Rate on
Adjusted Earnings
|
-
|
16% - 18%
|
Unchanged
|
Unchanged
|
Big 3
Segments
(Legal Professionals,
Corporates and Tax & Accounting Professionals)
|
Q3
2021
Outlook
|
Original
FY
2021
Outlook
(February 23,
2021)
|
FY
2021
Outlook
Update
(May 4,
2021)
|
FY
2021
Outlook
Update
(August 5,
2021)
|
Total Revenue
Growth
|
5.0% -
5.5%
|
4.5% -
5.5%
|
5.0% -
5.5%
|
5.5% -
6.0%
|
Organic Revenue
Growth
|
5.0% -
5.5%
|
4.5% -
5.5%
|
5.0% -
5.5%
|
5.5% -
6.0%
|
Adjusted EBITDA
Margin
|
-
|
38% - 39%
|
Unchanged
|
~ 39%
|
The information in this section is
forward-looking. Actual results, which include the
impact of currency and future acquisitions and dispositions
completed during 2021, 2022 and 2023, may differ materially from
the company's outlook. Some of
the forward-looking financial measures in the
outlook above are provided on a non-IFRS basis. See the section
below entitled "Non-IFRS Financial Measures" for more information.
The information in this section should also be read in conjunction
with the section below entitled "Special Note Regarding
Forward-Looking Statements, Material Risks and Material
Assumptions."
Share Repurchases - New $1.2
Billion Buyback Program and Amended Normal Course Issuer
Bid
Thomson Reuters also announced today that it plans to buy back
up to $1.2 billion of its common
shares. The new buyback program is in addition to the $200 million repurchase program that was
completed earlier this year.
Shares will be repurchased for the new buyback program under an
amended normal course issuer bid (NCIB). The amended NCIB, which is
subject to acceptance by the Toronto Stock Exchange (TSX), is
expected to become effective on or about August 10, 2021. The amended NCIB will increase
the maximum number of common shares that may be repurchased by an
additional 15 million. Under the amended NCIB, up to 20 million
common shares (representing approximately 4% of the company's
497,117,528 issued and outstanding shares as of December 24, 2020) may be repurchased between
January 4, 2021 and January 3, 2022. The NCIB, as originally approved
in December 2020, contemplated the
repurchase of up to 5 million common shares. Under the current
NCIB, Thomson Reuters repurchased 2,455,807 common shares in the
first quarter of 2021 for a total cost of approximately
$200 million, representing an average
price of $81.45 per share.
Under the amended NCIB, shares may be repurchased in open market
transactions on the TSX, the NYSE and/or other exchanges and
alternative trading systems, if eligible, or by such other means as
may be permitted by the TSX and/or NYSE or under applicable law,
including private agreement purchases if Thomson Reuters receives
an issuer bid exemption order in the future from applicable
securities regulatory authorities in Canada for such purchases. The price that
Thomson Reuters will pay for common shares in open market
transactions will be the market price at the time of purchase or
such other price as may be permitted by the TSX. Any private
agreement purchases made under an exemption order may be at a
discount to the prevailing market price. In accordance with TSX
rules, any daily repurchases (other than pursuant to a block
purchase exception) on the TSX under the amended NCIB are limited
to a maximum of 127,341 shares, which represents 25% of the average
daily trading volume on the TSX of 509,367 for the six months ended
November 30, 2020 (net of repurchases
made by the company during that time period). Any shares that are
repurchased are cancelled.
From time to time when Thomson Reuters does not possess material
non-public information about itself or its securities, it may enter
into a pre-defined plan with its broker to allow for the repurchase
of shares at times when the company ordinarily would not be active
in the market due to its own internal trading blackout periods,
insider trading rules or otherwise. Any such plans entered into
with the company's broker will be adopted in accordance with
applicable Canadian securities laws and the requirements of Rule
10b5-1 under the U.S. Securities Exchange Act of 1934, as
amended.
Decisions regarding any future repurchases will depend on
factors, such as market conditions, share price and other
opportunities to invest capital for growth. Thomson Reuters may
elect to suspend or discontinue share repurchases at any time, in
accordance with applicable laws.
Dividends
In February 2021, the company
announced its Board of Directors approved a $0.10 per share annualized increase in the
dividend to $1.62 per common share,
representing the 28th consecutive year of dividend
increases. A quarterly dividend of $0.405 per share is payable on September 15, 2021 to common shareholders of
record as of August 19, 2021.
London Stock Exchange Group (LSEG) Ownership Interest
In January 2021, Thomson Reuters
and private equity funds affiliated with Blackstone sold Refinitiv
to LSEG in an all-share transaction. Thomson Reuters indirectly
owns LSEG shares through an entity that it jointly owns with
Blackstone's consortium and a group of current and former Refinitiv
senior management.
As of August 4, 2021, Thomson
Reuters indirectly owned approximately 72.4 million LSEG shares
which had a market value of approximately $7.5 billion based on LSEG's closing share price
on that day. Based on Thomson Reuters' ownership interest in LSEG,
it expects to receive dividends of approximately $75 million in 2021.
In March 2021, as permitted under
a lock-up exception, Thomson Reuters sold approximately 10.1
million LSEG shares for pre-tax net proceeds of $994 million. Over the course of 2021, Thomson
Reuters will pay approximately $225
million of tax on the sale of these shares and will use the
after-tax proceeds to pay the approximately $640 million of taxes that became payable when
the Refinitiv sale closed. In the six-month period ended
June 30, 2021, the company paid
$444 million of taxes related to
these transactions.
Social Impact/ESG
In the second quarter of 2021, Thomson Reuters issued its 2020
Social Impact Report, which focuses on the company's Environmental,
Social and Governance (ESG) efforts. A copy of the report is
available on the company's Social Impact
website.
Thomson Reuters
Thomson Reuters is a leading provider of business information
services. Our products include highly specialized
information-enabled software and tools for legal, tax, accounting
and compliance professionals combined with the world's most global
news service – Reuters. For more information on Thomson Reuters,
visit tr.com and for the latest world news,
reuters.com.
NON-IFRS FINANCIAL MEASURES
Thomson Reuters prepares its financial statements in
accordance with International Financial Reporting Standards (IFRS),
as issued by the International Accounting Standards Board
(IASB).
This news release includes certain non-IFRS financial
measures, such as adjusted EBITDA and the related margin (other
than at the customer segment level), net debt to adjusted EBITDA
leverage ratio, free cash flow, adjusted EPS, selected measures
excluding the impact of foreign currency, and changes in revenues
computed on an organic basis. Thomson Reuters uses these non-IFRS
financial measures as supplemental indicators of its operating
performance and financial position. These measures do not have any
standardized meanings prescribed by IFRS and therefore are unlikely
to be comparable to the calculation of similar measures used by
other companies, and should not be viewed as alternatives to
measures of financial performance calculated in accordance with
IFRS. Non-IFRS financial measures are defined and reconciled to the
most directly comparable IFRS measures in the appended
tables.
The company's outlook contains various non-IFRS financial
measures. The company believes that providing reconciliations of
forward-looking non-IFRS financial measures in its outlook would be
potentially misleading and not practical due to the difficulty of
projecting items that are not reflective of ongoing operations in
any future period. The magnitude of these items may be significant.
Consequently, for outlook purposes only, the company is unable to
reconcile these non-IFRS measures to the most comparable IFRS
measures because it cannot predict, with reasonable certainty, the
2021, 2022 and 2023 impacts of changes in foreign exchange rates
which impact (i) the translation of its results reported at average
foreign currency rates for the year, and (ii) other finance income
or expense related to intercompany financing arrangements.
Additionally, the company cannot reasonably predict
(i) its share of post-tax earnings (losses) in equity
method investments, which is subject to changes in the stock
price of LSEG or (ii) the occurrence or amount of other operating
gains and losses that generally arise from business transactions
that the company does not currently anticipate.
ROUNDING
Other than EPS, the company reports its results in millions
of U.S. dollars, but computes percentage changes and margins using
whole dollars to be more precise. As a result, percentages and
margins calculated from reported amounts may differ from those
presented, and growth components may not total due to
rounding.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS, MATERIAL
RISKS AND MATERIAL ASSUMPTIONS
Certain statements in this news release, including, but not
limited to, statements in Mr. Hasker's comments, the "Thomson
Reuters Change Program and Outlook" section, and the company's
expectations regarding Global Print and share repurchases, are
forward-looking. The words "will", "expect", "believe", "target",
"estimate", "could", "should", "intend", "predict", "project" and
similar expressions identify forward-looking statements. While the
company believes that it has a reasonable basis for making
forward-looking statements in this news release, they are not a
guarantee of future performance or outcomes and there is no
assurance that any of the other events described in any
forward-looking statement will materialize. Forward-looking
statements, including those related to the COVID-19 pandemic, are
subject to a number of risks, uncertainties and assumptions that
could cause actual results or events to differ materially from
current expectations. Many of these risks, uncertainties and
assumptions are beyond the company's control and the effects of
them can be difficult to predict. In particular, the full extent of
the impact of the COVID-19 pandemic on the company's business,
operations and financial results will depend on numerous evolving
factors that it may not be able to accurately predict.
Some of the material risk factors that could cause actual
results or events to differ materially from those expressed in or
implied by forward-looking statements in this news release include,
but are not limited to, those discussed on pages 16-30 in the "Risk
Factors" section of the company's annual report for the year ended
December 31, 2020. These and other
risk factors are discussed in materials that Thomson Reuters from
time to time files with, or furnishes to, the Canadian securities
regulatory authorities and the U.S. Securities and Exchange
Commission (SEC). Thomson Reuters annual and quarterly reports are
also available in the "Investor Relations" section of
tr.com.
The company's business outlook is based on information
currently available to the company and is based on various external
and internal assumptions made by the company in light of its
experience and perception of historical trends, current conditions
and expected future developments (including those related to the
COVID-19 pandemic), as well as other factors that the company
believes are appropriate under the circumstances. Material
assumptions and material risks may cause actual performance to
differ from the company's expectations underlying its business
outlook, which reflects the global economic crisis caused by the
COVID-19 pandemic. For a discussion of material assumptions and
material risks related to the company's outlook, please see pages
21-22 of the company's first-quarter management's discussion and
analysis (MD&A) for the period ended March 31, 2021. Material assumptions and material
risks related to the company's outlook will also be included in the
company's second-quarter MD&A for the period ended June 30, 2021, expected to be filed shortly. The
company's MD&A is filed with, or furnished to, the Canadian
securities regulatory authorities and the U.S. SEC and is also
available in the "Investor Relations" section of tr.com.
The company has provided an updated Outlook for the purpose
of presenting information about current expectations for the
periods presented. This information may not be appropriate for
other purposes. You are cautioned not to place undue reliance on
forward-looking statements which reflect expectations only as of
the date of this news release.
Except as may be required by applicable law, Thomson Reuters
disclaims any obligation to update or revise any forward-looking
statements, including those related to the COVID-19
pandemic.
CONTACTS
MEDIA
Melissa
Cassar
Head of Commercial
Communications & Corporate Affairs
+1 437 388
3619
melissa.cassar@tr.com
|
INVESTORS
Frank J.
Golden
Head of Investor
Relations
+1 332 219
1111
frank.golden@tr.com
|
Thomson Reuters will webcast a discussion of its
second-quarter 2021 results and its business outlook today
beginning at 9:00 a.m. Eastern Daylight
Time (EDT). You can access the webcast by visiting
ir.tr.com. An archive of the webcast will be available following
the presentation.
Thomson Reuters Corporation
2021 - 2023
Outlook
Total Thomson
Reuters
|
2021
Outlook
Updated
|
2022
Outlook
Reaffirmed
|
2023
Outlook
Reaffirmed
|
Total Revenue
Growth
|
4.0% -
4.5%
|
4.0% -
5.0%
|
5.0% -
6.0%
|
Organic Revenue
Growth
|
4.0% -
4.5%
|
4.0% -
5.0%
|
5.0% -
6.0%
|
Adjusted EBITDA
Margin
|
31% - 32%
|
34% - 35%
|
38% – 40%
|
Corporate
Costs
Core Corporate
Costs
Change Program Operating
Expenses
|
$305 - $340
million
$130 - $140
million
$175 - $200
million
|
$245 - $280
million
$120 - $130
million
$125 - $150
million
|
$110 - $120
million
$110 - $120
million
$0
|
Free Cash
Flow
|
$1.1 - $1.2
billion
|
$1.2 - $1.3
billion
|
$1.8 - $2.0
billion
|
Capital Expenditures
- % of Revenue
Change Program Capital
Expenditures
|
9.0% -
9.5%
$125 - $150
million
|
7.5% -
8.0%
$75 - $100
million
|
6.0% -
6.5%
$0
|
Depreciation &
Amortization of
Computer
Software
|
$650 - $675
million
|
$620 - $645
million
|
$580 - $605
million
|
Interest Expense
(P&L)
|
$190 - $210
million
|
$190 - $210
million
|
$190 - $210
million
|
Effective Tax Rate on
Adjusted Earnings
|
16% - 18%
|
n/a
|
n/a
|
Big 3
Segments
(Legal Professionals,
Corporates and Tax & Accounting Professionals)
|
2021
Outlook
Updated
|
2022
Outlook
Reaffirmed
|
2023
Outlook
Reaffirmed
|
Total Revenue
Growth
|
5.5% -
6.0%
|
5.5% -
6.5%
|
6.0% -
7.0%
|
Organic Revenue
Growth
|
5.5% -
6.0%
|
5.5% -
6.5%
|
6.0% -
7.0%
|
Adjusted EBITDA
Margin
|
~ 39%
|
41% - 42%
|
43% - 45%
|
The information in this section is
forward-looking. Actual results, which include the
impact of currency and future acquisitions and dispositions
completed during 2021, 2022 and 2023, may differ materially from
the company's outlook. Some of
the forward-looking financial measures in the
outlook above are provided on a non-IFRS basis. See the section
above entitled "Non-IFRS Financial Measures" for more information.
The information in this section should also be read in conjunction
with the section above entitled "Special Note Regarding
Forward-Looking Statements, Material Risks and Material
Assumptions."
Thomson Reuters
Corporation
Consolidated
Income Statement
(millions of U.S.
dollars, except per share data)
(unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
|
2021
|
2020
|
|
2021
|
2020
|
CONTINUING
OPERATIONS
|
|
|
|
|
|
Revenues
|
$1,532
|
$1,405
|
|
$3,112
|
$2,925
|
Operating
expenses
|
(1,036)
|
(929)
|
|
(2,054)
|
(1,946)
|
Depreciation
|
(42)
|
(43)
|
|
(88)
|
(83)
|
Amortization of
computer software
|
(122)
|
(118)
|
|
(237)
|
(229)
|
Amortization of other
identifiable intangible assets
|
(30)
|
(30)
|
|
(61)
|
(60)
|
Other operating
gains, net
|
14
|
80
|
|
31
|
48
|
Operating
profit
|
316
|
365
|
|
703
|
655
|
Finance costs,
net:
|
|
|
|
|
|
Net interest
expense
|
(49)
|
(52)
|
|
(100)
|
(97)
|
Other finance income
(costs)
|
2
|
(13)
|
|
(4)
|
34
|
Income before tax and
equity method investments
|
269
|
300
|
|
599
|
592
|
Share of post-tax
earnings (losses) in equity method investments
|
1,092
|
(153)
|
|
7,389
|
(207)
|
Tax
expense
|
(289)
|
(16)
|
|
(1,883)
|
(63)
|
Earnings from
continuing operations
|
1,072
|
131
|
|
6,105
|
322
|
Loss from
discontinued operations, net of tax
|
(4)
|
(5)
|
|
(1)
|
(3)
|
Net
earnings
|
$1,068
|
$126
|
|
$6,104
|
$319
|
Earnings attributable
to common shareholders
|
$1,068
|
$126
|
|
$6,104
|
$319
|
|
|
|
|
|
|
Earnings (loss)
per share:
|
|
|
|
|
|
Basic earnings per
share:
|
|
|
|
|
|
From
continuing operations
|
$2.16
|
$0.26
|
|
$12.31
|
$0.65
|
From
discontinued operations
|
(0.01)
|
(0.01)
|
|
(0.01)
|
(0.01)
|
Basic earnings per
share
|
$2.15
|
$0.25
|
|
$12.30
|
$0.64
|
|
|
|
|
|
|
Diluted earnings per
share:
|
|
|
|
|
|
From
continuing operations
|
$2.16
|
$0.26
|
|
$12.28
|
$0.65
|
From
discontinued operations
|
(0.01)
|
(0.01)
|
|
-
|
(0.01)
|
Diluted earnings per
share
|
$2.15
|
$0.25
|
|
$12.28
|
$0.64
|
|
|
|
|
|
|
Basic
weighted-average common shares
|
496,098,238
|
496,317,115
|
|
496,016,467
|
496,261,070
|
Diluted
weighted-average common shares
|
497,259,072
|
497,580,339
|
|
497,109,791
|
497,579,131
|
|
|
|
|
|
|
|
Thomson Reuters
Corporation
Consolidated
Statement of Financial Position
(millions of U.S.
dollars)
(unaudited)
|
|
|
June 30,
|
|
December
31,
|
2021
|
|
2020
|
Assets
|
|
|
|
Cash and cash
equivalents
|
$2,342
|
|
$1,787
|
Trade and other
receivables
|
1,041
|
|
1,151
|
Other financial
assets
|
77
|
|
612
|
Prepaid expenses and
other current assets
|
425
|
|
425
|
Current
assets
|
3,885
|
|
3,975
|
|
|
|
|
Property and
equipment, net
|
482
|
|
545
|
Computer software,
net
|
819
|
|
830
|
Other identifiable
intangible assets, net
|
3,368
|
|
3,427
|
Goodwill
|
5,992
|
|
5,976
|
Equity method
investments
|
7,913
|
|
1,136
|
Other non-current
assets
|
929
|
|
788
|
Deferred
tax
|
1,173
|
|
1,204
|
Total
assets
|
$24,561
|
|
$17,881
|
|
|
|
|
Liabilities and
equity
|
|
|
|
Liabilities
|
|
|
|
Payables, accruals
and provisions
|
$1,023
|
|
$1,159
|
Current tax
liabilities
|
663
|
|
251
|
Deferred
revenue
|
923
|
|
866
|
Other financial
liabilities
|
158
|
|
376
|
Current
liabilities
|
2,767
|
|
2,652
|
|
|
|
|
Long-term
indebtedness
|
3,806
|
|
3,772
|
Provisions and other
non-current liabilities
|
927
|
|
1,083
|
Deferred
tax
|
1,284
|
|
394
|
Total
liabilities
|
8,784
|
|
7,901
|
|
|
|
|
Equity
|
|
|
|
Capital
|
5,502
|
|
5,458
|
Retained
earnings
|
11,010
|
|
5,211
|
Accumulated other
comprehensive loss
|
(735)
|
|
(689)
|
Total
equity
|
15,777
|
|
9,980
|
Total liabilities
and equity
|
$24,561
|
|
$17,881
|
Thomson Reuters
Corporation
Consolidated
Statement of Cash Flow
(millions of U.S.
dollars)
(unaudited)
|
|
|
Three Months
Ended June 30,
|
|
Six Months
Ended
June
30,
|
|
2021
|
2020
|
|
2021
|
2020
|
Cash provided by
(used in):
|
|
|
|
|
|
Operating
activities
|
|
|
|
|
|
Earnings from
continuing operations
|
$1,072
|
$131
|
|
$6,105
|
$322
|
Adjustments
for:
|
|
|
|
|
|
Depreciation
|
42
|
43
|
|
88
|
83
|
Amortization of
computer software
|
122
|
118
|
|
237
|
229
|
Amortization of other
identifiable intangible assets
|
30
|
30
|
|
61
|
60
|
Share of post-tax
(earnings) losses in equity method investments
|
(1,092)
|
153
|
|
(7,389)
|
207
|
Deferred
tax
|
249
|
(34)
|
|
923
|
(37)
|
Other
|
33
|
(17)
|
|
63
|
(6)
|
Changes in working
capital and other items
|
15
|
(7)
|
|
800
|
(250)
|
Operating cash flows
from continuing operations
|
471
|
417
|
|
888
|
608
|
Operating cash flows
from discontinued operations
|
(9)
|
5
|
|
(46)
|
(10)
|
Net cash provided by
operating activities
|
462
|
422
|
|
842
|
598
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
|
Acquisitions, net of
cash acquired
|
-
|
2
|
|
(3)
|
(122)
|
Proceeds from
disposals of businesses and investments
|
10
|
4
|
|
15
|
1
|
Dividend from sale of
LSEG shares
|
-
|
-
|
|
994
|
-
|
Capital
expenditures
|
(113)
|
(145)
|
|
(233)
|
(287)
|
Proceeds from
disposals of property and equipment
|
-
|
45
|
|
-
|
64
|
Other investing
activities
|
52
|
1
|
|
53
|
2
|
Taxes paid on sale of
Refinitiv and LSEG shares
|
(438)
|
-
|
|
(444)
|
-
|
Investing cash flows
from continuing operations
|
(489)
|
(93)
|
|
382
|
(342)
|
Investing cash flows
from discontinued operations
|
-
|
-
|
|
(42)
|
-
|
Net cash (used in)
provided by investing activities
|
(489)
|
(93)
|
|
340
|
(342)
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
|
Proceeds from
debt
|
-
|
999
|
|
-
|
2,019
|
Repayments of
debt
|
-
|
(1,000)
|
|
-
|
(1,645)
|
Net borrowings under
short-term loan facilities
|
-
|
-
|
|
-
|
118
|
Payments of lease
principal
|
(22)
|
(18)
|
|
(43)
|
(36)
|
Repurchases of common
shares
|
-
|
-
|
|
(200)
|
(200)
|
Dividends paid on
preference shares
|
-
|
-
|
|
(1)
|
(1)
|
Dividends paid on
common shares
|
(194)
|
(182)
|
|
(388)
|
(364)
|
Other financing
activities
|
-
|
(4)
|
|
5
|
(16)
|
Net cash used in
financing activities
|
(216)
|
(205)
|
|
(627)
|
(125)
|
(Decrease) increase
in cash and bank overdrafts
|
(243)
|
124
|
|
555
|
131
|
Translation
adjustments
|
1
|
-
|
|
-
|
(10)
|
Cash and bank
overdrafts at beginning of period
|
2,584
|
822
|
|
1,787
|
825
|
Cash and bank
overdrafts at end of period
|
$2,342
|
$946
|
|
$2,342
|
$946
|
Cash and bank
overdrafts at end of period comprised of:
|
|
|
|
|
|
Cash and cash
equivalents
|
$2,342
|
$946
|
|
$2,342
|
$946
|
Thomson Reuters
Corporation
|
Reconciliation of
Earnings from Continuing Operations to Adjusted
EBITDA(1)
|
(millions of U.S.
dollars, except for margins)
|
(unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
June
30,
|
|
June
30,
|
|
2021
|
2020
|
|
2021
|
2020
|
|
|
|
|
|
|
Earnings from
continuing operations
|
$1,072
|
$131
|
|
$6,105
|
$322
|
Adjustments to
remove:
|
|
|
|
|
|
Tax expense
|
289
|
16
|
|
1,883
|
63
|
Other finance (income)
costs
|
(2)
|
13
|
|
4
|
(34)
|
Net interest
expense
|
49
|
52
|
|
100
|
97
|
Amortization of other
identifiable intangible assets
|
30
|
30
|
|
61
|
60
|
Amortization of
computer software
|
122
|
118
|
|
237
|
229
|
Depreciation
|
42
|
43
|
|
88
|
83
|
EBITDA
|
$1,602
|
$403
|
|
$8,478
|
$820
|
Adjustments to
remove:
|
|
|
|
|
|
Share of post-tax
(earnings) losses in equity method investments
|
(1,092)
|
153
|
|
(7,389)
|
207
|
Other operating gains,
net
|
(14)
|
(80)
|
|
(31)
|
(48)
|
Fair value
adjustments(4)
|
6
|
3
|
|
2
|
(20)
|
Adjusted
EBITDA
|
$502
|
$479
|
|
$1,060
|
$959
|
Adjusted EBITDA
margin(1)
|
32.7%
|
34.1%
|
|
34.1%
|
32.8%
|
|
|
|
|
|
|
Thomson Reuters
Corporation
|
Reconciliation of
Net Earnings to Adjusted
Earnings(2)
|
Reconciliation of
Total Change in Adjusted EPS(2) to
Change in Constant Currency(5)
|
(millions of U.S.
dollars, except for share and per share data)
|
(unaudited)
|
|
|
Three Months
Ended
June
30,
|
|
Six Months
Ended June 30,
|
|
|
|
2021
|
2020
|
Change
|
|
2021
|
2020
|
Change
|
Net
earnings
|
$1,068
|
$126
|
|
|
$6,104
|
$319
|
|
Adjustments to
remove:
|
|
|
|
|
|
|
|
Fair value adjustments
(4)
|
6
|
3
|
|
|
2
|
(20)
|
|
Amortization of other
identifiable intangible assets
|
30
|
30
|
|
|
61
|
60
|
|
Other operating gains,
net
|
(14)
|
(80)
|
|
|
(31)
|
(48)
|
|
Other finance (income)
costs
|
(2)
|
13
|
|
|
4
|
(34)
|
|
Share of post-tax
(earnings) losses in equity method
investments
|
(1,092)
|
153
|
|
|
(7,389)
|
207
|
|
Tax on above
items
|
255
|
(28)
|
|
|
1,790
|
(59)
|
|
Tax items impacting
comparability
|
(12)
|
9
|
|
|
(11)
|
39
|
|
Loss from discontinued
operations, net of tax
|
4
|
5
|
|
|
1
|
3
|
|
Interim period
effective tax rate normalization(3)
|
(3)
|
(10)
|
|
|
(2)
|
(6)
|
|
Dividends declared on
preference shares
|
-
|
-
|
|
|
(1)
|
(1)
|
|
Adjusted earnings
(2)
|
$240
|
$221
|
|
|
$528
|
$460
|
|
Adjusted EPS
(2)
|
$0.48
|
$0.44
|
9%
|
|
$1.06
|
$0.92
|
15%
|
Foreign
currency(5)
|
|
|
0%
|
|
|
|
0%
|
Constant
currency(5)
|
|
|
9%
|
|
|
|
15%
|
|
|
|
|
|
|
|
|
Diluted
weighted-average common shares (millions)
|
497.3
|
497.6
|
|
|
497.1
|
497.6
|
|
Refer to page 24 for footnotes.
Thomson Reuters
Corporation
|
Reconciliation of
Net Cash Provided by Operating Activities to Free Cash
Flow(6)
|
(millions of U.S.
dollars)
|
(unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
June
30,
|
|
June
30,
|
|
2021
|
2020
|
|
2021
|
2020
|
Net cash provided
by operating activities
|
$462
|
$422
|
|
$842
|
$598
|
Capital
expenditures
|
(113)
|
(145)
|
|
(233)
|
(287)
|
Proceeds from
disposals of property and equipment
|
-
|
45
|
|
-
|
64
|
Other investing
activities
|
52
|
1
|
|
53
|
2
|
Payments of lease
principal
|
(22)
|
(18)
|
|
(43)
|
(36)
|
Dividends paid on
preference shares
|
-
|
-
|
|
(1)
|
(1)
|
Free cash
flow
|
$379
|
$305
|
|
$618
|
$340
|
|
|
|
|
|
|
|
Thomson Reuters
Corporation
|
Reconciliation of
Net Debt and Leverage Ratio of Net Debt to Adjusted
EBITDA(8)
|
(millions of U.S.
dollars)
|
(unaudited)
|
|
|
|
June
30, 2021
|
Long-term
indebtedness
|
|
$3,806
|
Total
debt
|
|
3,806
|
Swaps
|
|
(125)
|
Total debt after
swaps
|
|
3,681
|
Remove fair value
adjustments for hedges
|
|
(7)
|
Total debt after
currency arrangements
|
|
3,674
|
Remove transaction
costs, premiums or discounts included in the carrying value of
debt
|
|
36
|
Add: lease
liabilities (current and non-current)
|
|
271
|
Less: cash and cash
equivalents
|
|
(2,342)
|
Net debt
(8)
|
|
$1,639
|
|
|
|
Adjusted
EBITDA(1)*
|
|
$2,076
|
Net Debt /
Adjusted EBITDA(8)*
|
|
0.8:1
|
* The company's target leverage ratio of 2.5:1 is a non-IFRS
measure. For purposes of this calculation, adjusted EBITDA is
computed on a rolling twelve-month basis and includes adjusted
EBITDA of $502 million, $558 million, $525
million and $491 million for
the three months ended June 30, 2021,
March 31, 2021, December 31, 2020 and September 30, 2020, respectively. Refer to the
tables appended to this news release, the company's 2020 annual
report and the company's MD&A for the three months ended
March 31, 2021 and September 30, 2020, for additional information
regarding the calculation of adjusted EBITDA in each of these
periods.
Refer to page 24 for footnotes.
Thomson Reuters
Corporation
|
Reconciliation of
Changes in Revenues to Changes in Revenues on a Constant
Currency(5) and Organic
Basis(7)
|
(millions of U.S.
dollars)
|
(unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
June
30,
|
|
Change
|
|
|
2021
|
2020
|
|
Total
|
Foreign
Currency
|
SUBTOTAL Constant
Currency(5)
|
Acquisitions/
(Divestitures)
|
Organic(7)
|
Total
Revenues
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$673
|
$620
|
|
9%
|
2%
|
7%
|
0%
|
6%
|
Corporates
|
|
348
|
329
|
|
6%
|
1%
|
4%
|
0%
|
4%
|
Tax &
Accounting Professionals
|
|
197
|
168
|
|
17%
|
1%
|
15%
|
0%
|
15%
|
"Big 3" Segments
Combined
|
|
1,218
|
1,117
|
|
9%
|
2%
|
7%
|
0%
|
7%
|
Reuters
News
|
|
168
|
155
|
|
9%
|
2%
|
6%
|
0%
|
6%
|
Global
Print
|
|
147
|
134
|
|
9%
|
3%
|
6%
|
0%
|
6%
|
Eliminations/Rounding
|
|
(1)
|
(1)
|
|
|
|
|
|
|
Revenues
|
|
$1,532
|
$1,405
|
|
9%
|
2%
|
7%
|
0%
|
7%
|
|
|
|
|
|
|
|
|
|
|
Recurring
Revenues
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$626
|
$580
|
|
8%
|
2%
|
6%
|
0%
|
6%
|
Corporates
|
|
300
|
282
|
|
6%
|
2%
|
5%
|
0%
|
5%
|
Tax &
Accounting Professionals
|
|
150
|
136
|
|
10%
|
1%
|
9%
|
0%
|
9%
|
"Big 3" Segments
Combined
|
|
1,076
|
998
|
|
8%
|
2%
|
6%
|
0%
|
6%
|
Reuters
News
|
|
144
|
141
|
|
3%
|
2%
|
1%
|
0%
|
1%
|
Total Recurring
Revenues
|
|
$1,220
|
$1,139
|
|
7%
|
2%
|
5%
|
0%
|
5%
|
|
|
|
|
|
|
|
|
|
|
Transactions
Revenues
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$47
|
$40
|
|
18%
|
4%
|
14%
|
0%
|
14%
|
Corporates
|
|
48
|
47
|
|
2%
|
1%
|
1%
|
0%
|
1%
|
Tax &
Accounting Professionals
|
|
47
|
32
|
|
45%
|
2%
|
43%
|
0%
|
43%
|
"Big 3" Segments
Combined
|
|
142
|
119
|
|
19%
|
2%
|
17%
|
0%
|
17%
|
Reuters
News
|
|
24
|
14
|
|
72%
|
9%
|
62%
|
2%
|
61%
|
Total Transactions
Revenues
|
|
$166
|
$133
|
|
25%
|
3%
|
22%
|
0%
|
22%
|
|
|
|
|
|
|
|
|
|
|
Growth percentages are computed using whole dollars. As a
result, percentages calculated from reported amounts may differ
from those presented, and growth components may not total due to
rounding.
Refer to page 24 for footnotes.
Thomson Reuters
Corporation
|
Reconciliation of
Changes in Revenues to Changes in Revenues on a Constant
Currency(5) and Organic
Basis(7)
|
(millions of U.S.
dollars)
|
(unaudited)
|
|
|
|
Six Months
Ended
|
|
|
|
|
June
30,
|
|
Change
|
|
|
2021
|
2020
|
|
Total
|
Foreign
Currency
|
SUBTOTAL
Constant Currency(5)
|
Acquisitions/(Divestitures)
|
Organic(7)
|
Total
Revenues
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$1,341
|
$1,246
|
|
8%
|
2%
|
6%
|
0%
|
6%
|
Corporates
|
|
732
|
696
|
|
5%
|
1%
|
4%
|
0%
|
4%
|
Tax &
Accounting Professionals
|
|
422
|
386
|
|
9%
|
0%
|
9%
|
0%
|
9%
|
"Big 3" Segments
Combined
|
|
2,495
|
2,328
|
|
7%
|
1%
|
6%
|
0%
|
6%
|
Reuters
News
|
|
328
|
310
|
|
6%
|
2%
|
4%
|
0%
|
4%
|
Global
Print
|
|
290
|
289
|
|
0%
|
2%
|
-2%
|
0%
|
-2%
|
Eliminations/Rounding
|
|
(1)
|
(2)
|
|
|
|
|
|
|
Revenues
|
|
$3,112
|
$2,925
|
|
6%
|
1%
|
5%
|
0%
|
5%
|
|
|
|
|
|
|
|
|
|
|
Recurring
Revenues
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$1,247
|
$1,167
|
|
7%
|
2%
|
5%
|
0%
|
5%
|
Corporates
|
|
595
|
563
|
|
6%
|
1%
|
5%
|
0%
|
5%
|
Tax &
Accounting Professionals
|
|
310
|
294
|
|
6%
|
-1%
|
6%
|
0%
|
6%
|
"Big 3" Segments
Combined
|
|
2,152
|
2,024
|
|
6%
|
1%
|
5%
|
0%
|
5%
|
Reuters
News
|
|
288
|
283
|
|
2%
|
2%
|
0%
|
0%
|
0%
|
Total Recurring
Revenues
|
|
$2,440
|
$2,307
|
|
6%
|
1%
|
5%
|
0%
|
4%
|
|
|
|
|
|
|
|
|
|
|
Transactions
Revenues
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$94
|
$79
|
|
19%
|
3%
|
16%
|
0%
|
16%
|
Corporates
|
|
137
|
133
|
|
3%
|
0%
|
3%
|
0%
|
3%
|
Tax &
Accounting Professionals
|
|
112
|
92
|
|
20%
|
1%
|
19%
|
0%
|
19%
|
"Big 3" Segments
Combined
|
|
343
|
304
|
|
13%
|
1%
|
11%
|
0%
|
11%
|
Reuters
News
|
|
40
|
27
|
|
48%
|
5%
|
43%
|
1%
|
42%
|
Total Transactions
Revenues
|
|
$383
|
$331
|
|
15%
|
2%
|
14%
|
0%
|
14%
|
|
|
|
|
|
|
|
|
|
|
Growth percentages are computed using whole dollars. As a
result, percentages calculated from reported amounts may differ
from those presented, and growth components may not total due to
rounding.
Refer to page 24 for footnotes.
Thomson Reuters
Corporation
|
Reconciliation of
Changes in Adjusted EBITDA(1) to Changes on a Constant
Currency Basis(5)
|
(millions of U.S.
dollars)
|
(unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
June
30,
|
|
Change
|
|
|
2021
|
2020
|
|
Total
|
Foreign
Currency
|
Constant
Currency(5)
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$285
|
$254
|
|
12%
|
2%
|
10%
|
Corporates
|
|
130
|
118
|
|
10%
|
1%
|
9%
|
Tax &
Accounting Professionals
|
|
72
|
54
|
|
32%
|
1%
|
32%
|
"Big 3" Segments
Combined
|
|
487
|
426
|
|
14%
|
2%
|
13%
|
Reuters
News
|
|
35
|
25
|
|
45%
|
-21%
|
66%
|
Global
Print
|
|
56
|
54
|
|
2%
|
3%
|
-1%
|
Corporate
costs
|
|
(76)
|
(26)
|
|
n/a
|
n/a
|
n/a
|
Adjusted
EBITDA
|
|
$502
|
$479
|
|
5%
|
0%
|
5%
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
42.3%
|
40.9%
|
|
140bp
|
0bp
|
140bp
|
Corporates
|
|
37.2%
|
35.9%
|
|
130bp
|
-30bp
|
160bp
|
Tax &
Accounting Professionals
|
|
36.2%
|
31.9%
|
|
430bp
|
-20bp
|
450bp
|
"Big 3" Segments
Combined
|
|
39.9%
|
38.1%
|
|
180bp
|
-10bp
|
190bp
|
Reuters
News
|
|
20.8%
|
15.6%
|
|
520bp
|
-300bp
|
820bp
|
Global
Print
|
|
37.9%
|
40.5%
|
|
-260bp
|
20bp
|
-280bp
|
Corporate
costs
|
|
n/a
|
n/a
|
|
n/a
|
n/a
|
n/a
|
Adjusted EBITDA
margin
|
|
32.7%
|
34.1%
|
|
-140bp
|
-70bp
|
-70bp
|
|
|
|
|
|
|
|
|
n/a: not applicable
Growth percentages and margins are computed using whole
dollars. As a result, percentages and margins calculated from
reported amounts may differ from those presented, and growth
components may not total due to rounding.
Refer to page 24 for footnotes.
Thomson Reuters
Corporation
|
Reconciliation of
Changes in Adjusted EBITDA(1) to Changes on a Constant
Currency Basis(5)
|
(millions of U.S.
dollars)
|
(unaudited)
|
|
|
|
|
Six Months
Ended
|
|
|
|
|
June
30,
|
|
Change
|
|
|
2021
|
2020
|
|
Total
|
Foreign
Currency
|
Constant
Currency(5)
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$564
|
$484
|
|
17%
|
3%
|
14%
|
Corporates
|
|
276
|
235
|
|
17%
|
0%
|
17%
|
Tax &
Accounting Professionals
|
|
170
|
138
|
|
23%
|
0%
|
23%
|
"Big 3" Segments
Combined
|
|
1,010
|
857
|
|
18%
|
2%
|
16%
|
Reuters
News
|
|
63
|
44
|
|
45%
|
-20%
|
65%
|
Global
Print
|
|
113
|
117
|
|
-4%
|
3%
|
-6%
|
Corporate
costs
|
|
(126)
|
(59)
|
|
n/a
|
n/a
|
n/a
|
Adjusted
EBITDA
|
|
$1,060
|
$959
|
|
11%
|
1%
|
10%
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
42.1%
|
38.8%
|
|
330bp
|
30bp
|
300bp
|
Corporates
|
|
37.7%
|
33.8%
|
|
390bp
|
-20bp
|
410bp
|
Tax &
Accounting Professionals
|
|
40.2%
|
35.7%
|
|
450bp
|
10bp
|
440bp
|
"Big 3" Segments
Combined
|
|
40.5%
|
36.8%
|
|
370bp
|
20bp
|
350bp
|
Reuters
News
|
|
19.2%
|
14.1%
|
|
510bp
|
-270bp
|
780bp
|
Global
Print
|
|
38.9%
|
40.5%
|
|
-160bp
|
30bp
|
-190bp
|
Corporate
costs
|
|
n/a
|
n/a
|
|
n/a
|
n/a
|
n/a
|
Adjusted EBITDA
margin
|
|
34.1%
|
32.8%
|
|
130bp
|
-30bp
|
160bp
|
|
|
|
|
|
|
|
|
n/a: not applicable
Growth percentages and margins are computed using whole
dollars. As a result, percentages and margins calculated from
reported amounts may differ from those presented, and growth
components may not total due to rounding.
Refer to page 24 for footnotes.
Footnotes
(1)
|
Thomson Reuters
defines adjusted EBITDA for its business segments as earnings or
losses from continuing operations before tax expense or benefit,
net interest expense, other finance costs or income, depreciation,
amortization of software and other identifiable intangible assets,
Thomson Reuters share of post-tax earnings or losses in equity
method investments, other operating gains and losses, certain asset
impairment charges, fair value adjustments and corporate related
items. Consolidated adjusted EBITDA is comprised of adjusted EBITDA
for its business segments and corporate costs. Adjusted EBITDA
margin is adjusted EBITDA expressed as a percentage of revenues.
Thomson Reuters uses adjusted EBITDA because it provides a
consistent basis to evaluate operating profitability and
performance trends by excluding items that the company does not
consider to be controllable activities for this purpose. Adjusted
EBITDA also represents a measure commonly reported and widely used
by investors as a valuation metric. Additionally, this measure is
used by Thomson Reuters and investors to assess a company's ability
to incur and service debt.
|
|
|
(2)
|
Thomson Reuters
defines adjusted earnings as net earnings or loss including
dividends declared on preference shares but excluding the post-tax
impacts of fair value adjustments, amortization of other
identifiable intangible assets, other operating gains and losses,
certain asset impairment charges, other finance costs or income,
Thomson Reuters share of post-tax earnings or losses in equity
method investments, discontinued operations and other items
affecting comparability. Thomson Reuters calculates the post-tax
amount of each item excluded from adjusted earnings based on the
specific tax rules and tax rates associated with the nature and
jurisdiction of each item. Adjusted EPS is calculated from adjusted
earnings using diluted weighted-average shares and does not
represent actual earnings or loss per share attributable to
shareholders. Thomson Reuters uses adjusted earnings and adjusted
EPS as they provide a more comparable basis to analyze earnings and
they are also measures commonly used by shareholders to measure the
company's performance.
|
|
|
(3)
|
Adjustment to reflect
income taxes based on estimated full-year effective tax rate.
Earnings or losses for interim periods under IFRS reflect income
taxes based on the estimated effective tax rates of each of the
jurisdictions in which Thomson Reuters operates. The non-IFRS
adjustment reallocates estimated full-year income taxes between
interim periods, but has no effect on full-year income
taxes.
|
|
|
(4)
|
Fair value
adjustments primarily represent gains or losses due to changes in
foreign currency exchange rates on intercompany balances that arise
in the ordinary course of business.
|
|
|
(5)
|
The changes in
revenues, adjusted EBITDA and the related margins, and adjusted
earnings per share before currency (at constant currency or
excluding the effects of currency) are determined by converting the
current and prior-year period's local currency equivalent using the
same exchange rates.
|
|
|
(6)
|
Free cash flow is net
cash provided by operating activities, proceeds from disposals of
property and equipment, and other investing activities less capital
expenditures, payments of lease principal and dividends paid on the
company's preference shares. Thomson Reuters uses free cash flow as
it helps assess the company's ability, over the long term, to
create value for its shareholders as it represents cash available
to repay debt, pay common dividends and fund share repurchases and
new acquisitions.
|
|
|
(7)
|
Represents changes in
revenues of our existing businesses at constant currency. The
metric excludes the distortive impacts of acquisitions and
dispositions from not owning the business in both comparable
periods. Thomson Reuters uses organic growth because it provides
further insight into the performance of its existing businesses by
excluding distortive impacts and serves as a better measure of the
company's ability to grow its business over the long
term.
|
|
|
(8)
|
Net debt is total
indebtedness (excluding the associated unamortized transaction
costs and premiums or discounts) plus the currency related fair
value of associated hedging instruments, and lease liabilities less
cash and cash equivalents. For purposes of calculating the leverage
ratio, net debt is divided by adjusted EBITDA for the previous
twelve-month period ending with the current fiscal
quarter.
|
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