TORONTO, Feb. 8, 2024
/CNW/ -- Thomson Reuters (TSX/NYSE: TRI) today reported
results for the fourth quarter and full year ended December 31, 2023:
- Good revenue momentum continued in the fourth quarter and full
year
- Full-year total company revenue up 3% / organic revenue up
6%
- Fourth-quarter total company revenue up 3% / organic revenue up
7%
- Organic revenue up 8% for the "Big 3" segments (Legal
Professionals, Corporates and Tax & Accounting
Professionals)
- Met or exceeded full-year 2023 outlook for organic revenue,
adjusted EBITDA margin and free cash flow
- Full-year 2024 outlook anticipates organic revenue growth of
approximately 6% and an adjusted EBITDA margin of approximately
38%
- Financial framework for 2025-2026 anticipates 6.5%-8% organic
revenue growth and rising adjusted EBITDA margins
- Increased annualized dividend per share by 10% (31st
consecutive annual increase)
- Anticipate current $1 billion
share buyback program to conclude by end of the second quarter
- Acquired a majority ownership stake in e-invoicing leader
Pagero in January 2024
"Last year was one of innovation and accomplishment across our
business," said Steve Hasker, President and CEO of Thomson
Reuters. "We made significant progress delivering Generative
AI-powered solutions, including the launch of AI-Assisted Research
on Westlaw Precision, as well as expanded features and design
enhancements across our product portfolio. We plan to maintain this
momentum in 2024 through a robust product roadmap positioning us to
meet our customers' evolving needs at pace."
Mr. Hasker added, "We remain focused on allocating capital to
drive long-term shareholder value creation. In 2023, we returned
significant capital to shareholders and executed a number of
strategic acquisitions, resulting in a stronger and more
strategically aligned portfolio with improved growth
prospects."
Consolidated Financial Highlights - Three Months Ended
December 31
Three Months Ended
December 31,
(Millions of U.S.
dollars, except for adjusted EBITDA margin and EPS)
(unaudited)
|
IFRS Financial
Measures(1)
|
2023
|
2022
|
Change
|
Change at
Constant
Currency
|
Revenues
|
$1,815
|
$1,765
|
3 %
|
|
Operating
profit
|
$558
|
$631
|
-11 %
|
|
Diluted earnings per
share (EPS)
|
$1.49
|
$0.45
|
231 %
|
|
Net cash provided by
operating activities
|
$705
|
$676
|
4 %
|
|
Non-IFRS Financial
Measures(1)
|
|
|
|
|
Revenues
|
$1,815
|
$1,765
|
3 %
|
3 %
|
Adjusted
EBITDA
|
$707
|
$633
|
12 %
|
9 %
|
Adjusted EBITDA
margin
|
38.9 %
|
35.9 %
|
300bp
|
210bp
|
Adjusted EPS
|
$0.98
|
$0.75(2)
|
31 %
|
28 %
|
Free cash
flow
|
$613
|
$526
|
16 %
|
|
(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. See the
"Non-IFRS Financial
Measures" section and the tables appended to
this news release for additional information on these and other
non-IFRS financial
measures, including how they are defined and
reconciled to the most directly comparable IFRS
measures.
(2) As of
September 2023, we amended our definition of adjusted earnings to
exclude amortization from acquired computer software. The
comparative 2022 period has been revised to
reflect the current period presentation. For additional
information, see the "Non-IFRS
Financial Measures" section of this news
release.
|
Revenues increased 3%, driven by growth in recurring and
transactions revenues. Net divestitures had a 4% negative impact on
revenues and foreign currency had no impact.
- Organic revenues increased 7%, driven by 7% growth in recurring
revenues (82% of total revenues) as well as 16% growth in
transactions revenues. Global Print revenues decreased 4%
organically.
- The company's "Big 3" segments reported organic revenue growth
of 8% and collectively comprised 80% of total revenues.
Operating profit decreased 11% because the prior-year
period included gains on the sale of several non-core
businesses.
- Adjusted EBITDA, which excludes gains on sales of businesses as
well as other adjustments, increased 12% due to higher revenues and
lower costs. The related margin increased to 38.9% from 35.9% in
the prior-year period. Lower costs reflected Change Program
investments made in the prior-year period, which benefited the
year-over-year change in adjusted EBITDA margin by 340bp. Foreign
currency contributed 90bp to the increase in adjusted EBITDA
margin.
Diluted EPS was $1.49
compared to $0.45 in the prior-year
period primarily due to an increase in value of the company's
investment in London Stock Exchange Group (LSEG), net of changes in
the value of related foreign exchange contracts, and lower income
tax expense, which included a non-cash tax benefit. Diluted EPS
also benefited from a reduction in weighted-average common shares
outstanding due to share repurchases and the company's June 2023 return of capital transaction.
- Adjusted EPS, which excludes the changes in value of the
company's LSEG investment and the related foreign exchange
contracts, the non-cash tax benefit as well as other adjustments,
increased to $0.98 per share from
$0.75 per share in the prior-year
period, primarily due to higher adjusted EBITDA. Adjusted EPS also
benefited from a reduction in weighted-average common shares.
Net cash provided by operating activities increased
$29 million as the cash benefits from
higher revenues and lower costs more than offset higher tax
payments.
- Free cash flow increased $87
million due to higher net cash provided by operating
activities and other investing activities, which included proceeds
from the sale of real estate. The prior-year period also included
investments in the Change Program.
Highlights by Customer Segment – Three Months Ended
December 31
(Millions of U.S.
dollars, except for adjusted EBITDA margins)
(unaudited)
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
December
31,
|
|
Change
|
|
|
2023
|
2022
|
|
Total
|
Constant
Currency(1)
|
Organic(1)(2)
|
Revenues
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$700
|
$704
|
|
-1 %
|
-1 %
|
7 %
|
Corporates
|
|
402
|
379
|
|
6 %
|
5 %
|
7 %
|
Tax &
Accounting Professionals
|
|
344
|
326
|
|
6 %
|
9 %
|
10 %
|
"Big 3" Segments
Combined(1)
|
|
1,446
|
1,409
|
|
3 %
|
3 %
|
8 %
|
Reuters
News
|
|
220
|
198
|
|
11 %
|
10 %
|
9 %
|
Global
Print
|
|
154
|
162
|
|
-6 %
|
-5 %
|
-4 %
|
Eliminations/Rounding
|
|
(5)
|
(4)
|
|
|
|
|
Revenues
|
|
$1,815
|
$1,765
|
|
3 %
|
3 %
|
7 %
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$298
|
$294
|
|
1 %
|
-2 %
|
|
Corporates
|
|
138
|
135
|
|
3 %
|
1 %
|
|
Tax &
Accounting Professionals
|
|
188
|
189
|
|
-1 %
|
1 %
|
|
"Big 3" Segments
Combined(1)
|
|
624
|
618
|
|
1 %
|
0 %
|
|
Reuters
News
|
|
61
|
40
|
|
56 %
|
52 %
|
|
Global
Print
|
|
55
|
59
|
|
-5 %
|
-8 %
|
|
Corporate
costs
|
|
(33)
|
(84)
|
|
n/a
|
n/a
|
|
Adjusted
EBITDA
|
|
$707
|
$633
|
|
12 %
|
9 %
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
42.5 %
|
41.7 %
|
|
80bp
|
-50bp
|
|
Corporates
|
|
34.5 %
|
35.7 %
|
|
-120bp
|
-140bp
|
|
Tax &
Accounting Professionals
|
|
54.6 %
|
58.1 %
|
|
-350bp
|
-430bp
|
|
"Big 3" Segments
Combined(1)
|
|
43.1 %
|
43.9 %
|
|
-80bp
|
-150bp
|
|
Reuters
News
|
|
27.9 %
|
19.8 %
|
|
810bp
|
720bp
|
|
Global
Print
|
|
36.4 %
|
36.1 %
|
|
30bp
|
-100bp
|
|
Adjusted EBITDA
margin
|
|
38.9 %
|
35.9 %
|
|
300bp
|
210bp
|
|
|
|
|
|
|
|
|
|
(1) See the
"Non-IFRS Financial Measures" section and the tables appended to
this news release for additional information on these and
other non-IFRS financial measures. To
compute segment and consolidated adjusted EBITDA margin, the
company excludes fair value
adjustments related to acquired deferred
revenues.
(2) Computed
for revenue growth only.
n/a: not
applicable
|
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 decreased 1% to $700
million due to the negative impact from net
divestitures. Organic revenues increased 7%.
- Recurring revenues increased 2% (96% of total, 7% organic).
Organic growth was primarily driven by Westlaw, Practical Law,
Casetext and the segment's international businesses.
- Transactions revenues decreased 39% (4% of total, increased 2%
organic).
Adjusted EBITDA increased 1% to $298 million.
- The margin increased to 42.5% from 41.7% reflecting a 130 basis
point benefit from foreign exchange.
Corporates
Revenues increased 5% to $402
million, including a negative impact from net divestitures.
Organic revenues increased 7%.
- Recurring revenues increased 6% (89% of total, 7% organic)
primarily driven by strong growth in Practical Law, Indirect Tax
and our Latin America
business.
- Transactions revenues increased 4% (11% of total, 7% organic),
primarily driven by our Trust offering and Confirmation.
Adjusted EBITDA increased 3% to $138 million.
- The margin decreased to 34.5% from 35.7%, primarily driven by
higher expenses.
Tax & Accounting Professionals
Revenues increased 9% to $344
million, including a negative impact from net divestitures.
Organic revenues increased 10%.
- Recurring revenues increased 8% (89% of total, 10% organic).
Organic growth was driven by Ultratax and the segment's
Latin America business.
- Transactions revenues increased 22% (11% of total, 14% organic)
primarily due to Confirmation and SurePrep.
Adjusted EBITDA decreased 1% to $188 million.
- The margin decreased to 54.6% from 58.1%, as higher revenues
were more than offset by higher expenses, driven largely by
SurePrep seasonality and integration costs.
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 $220 million
increased 10% (9% organic) driven primarily by Generative AI
related content licensing revenue that was largely transactional in
nature.
Adjusted EBITDA increased 56% to $61 million primarily due to higher revenues.
Global Print
Revenues decreased 5% (decreased 4% organic) to
$154 million, in line with our
expectations.
Adjusted EBITDA decreased 5% to $55 million.
- The margin increased to 36.4% from 36.1%, reflecting a 130
basis point benefit from foreign exchange.
Corporate Costs
Corporate costs at the adjusted EBITDA level were
$33 million. Corporate costs were
$84 million in the prior-year period
and included $60 million of Change
Program costs.
Consolidated Financial Highlights – Year Ended December 31
Year Ended December
31,
(Millions of U.S.
dollars, except for adjusted EBITDA margin and EPS)
(unaudited)
|
IFRS Financial
Measures(1)
|
2023
|
2022
|
Change
|
Change at
Constant
Currency
|
Revenues
|
$6,794
|
$6,627
|
3 %
|
|
Operating
profit
|
$2,332
|
$1,834
|
27 %
|
|
Diluted EPS
|
$5.80
|
$2.75
|
111 %
|
|
Net cash provided by
operating activities
|
$2,341
|
$1,915
|
22 %
|
|
Non-IFRS Financial
Measures(1)
|
|
|
|
|
Revenues
|
$6,794
|
$6,627
|
3 %
|
3 %
|
Adjusted
EBITDA
|
$2,678
|
$2,329
|
15 %
|
14 %
|
Adjusted EBITDA
margin
|
39.3 %
|
35.1 %
|
420bp
|
380bp
|
Adjusted EPS
|
$3.51
|
$2.62(2)
|
34 %
|
32 %
|
Free cash
flow
|
$1,871
|
$1,340
|
40 %
|
|
(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. See the "Non-IFRS Financial Measures" section
and the tables appended
to this news release for additional information
on these and other non-IFRS financial measures, including how they
are defined and
reconciled to the most directly comparable IFRS
measures.
(2) As of
September 2023, we amended our definition of adjusted earnings to
exclude amortization from acquired computer software.
The
comparative 2022 period has been revised to
reflect the current period presentation. For additional
information, see the "Non-IFRS
Financial Measures" section of this news
release.
|
Revenues increased 3%, driven by recurring and
transactions revenues. Net divestitures had a 3% negative impact on
revenues and foreign currency had no impact.
- Organic revenues increased 6%, driven by 6% growth in recurring
revenues (80% of total revenues) as well as 10% growth in
transactions revenues. Global Print revenues decreased 3%
organically.
- The company's "Big 3" segments reported organic revenue growth
of 7% and collectively comprised 81% of total revenues.
Operating profit increased 27% due to higher revenues and
lower costs, as well as higher gains from the sale of non-core
businesses, including the sale of a majority stake in the company's
Elite business.
- Adjusted EBITDA, which excludes the gains on sale
of Elite and other businesses, as well as other adjustments,
increased 15% due to higher revenues and lower costs. The related
margin increased to 39.3% from 35.1% in the prior year. Lower costs
reflected Change Program investments made in the prior year, which
benefited the year-over-year change in adjusted EBITDA margin by
260bp. Foreign currency contributed 40bp to the change in
margin.
Diluted EPS was $5.80 per
share compared to $2.75 per share in
the prior year, primarily due to higher operating profit and an
increase in the value of the company's investment in LSEG, net of
changes in the value of related foreign exchange contracts. Diluted
EPS also benefited from a reduction in weighted-average common
shares outstanding due to share repurchases and the company's
June 2023 return of capital
transaction.
- Adjusted EPS, which excludes the gains on sale of Elite
and other businesses, changes in value of the company's LSEG
investment, as well as other adjustments, increased to $3.51 per share from $2.62 per share in the prior year, primarily due
to higher adjusted EBITDA. Adjusted EPS also benefited from a
reduction in weighted-average common shares.
Net cash provided by operating activities increased
$426 million due to cash benefits
from higher revenues and lower costs as well as favorable movements
in working capital.
- Free cash flow increased $531 million primarily due to higher cash flows
from operating activities. Free cash flow also benefited from
lower capital expenditures and higher other investing activities,
which included proceeds from the sale of real estate. The prior
year included investments in the Change Program.
Highlights by Customer Segment - Year Ended December 31
(Millions of U.S.
dollars, except for adjusted EBITDA margins)
(unaudited)
|
|
|
Year
Ended
|
|
|
|
|
|
|
December
31,
|
|
Change
|
|
|
2023
|
2022
|
|
Total
|
Constant
Currency(1)
|
Organic(1)(2)
|
Revenues
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$2,807
|
$2,803
|
|
0 %
|
0 %
|
6 %
|
Corporates
|
|
1,620
|
1,536
|
|
5 %
|
5 %
|
7 %
|
Tax &
Accounting Professionals
|
|
1,058
|
986
|
|
7 %
|
9 %
|
10 %
|
"Big 3" Segments
Combined(1)
|
|
5,485
|
5,325
|
|
3 %
|
4 %
|
7 %
|
Reuters
News
|
|
769
|
733
|
|
5 %
|
5 %
|
4 %
|
Global
Print
|
|
562
|
592
|
|
-5 %
|
-4 %
|
-3 %
|
Eliminations/Rounding
|
|
(22)
|
(23)
|
|
|
|
|
Revenues
|
|
$6,794
|
$6,627
|
|
3 %
|
3 %
|
6 %
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$1,299
|
$1,227
|
|
6 %
|
5 %
|
|
Corporates
|
|
619
|
578
|
|
7 %
|
7 %
|
|
Tax &
Accounting Professionals
|
|
490
|
451
|
|
8 %
|
10 %
|
|
"Big 3" Segments
Combined(1)
|
|
2,408
|
2,256
|
|
7 %
|
6 %
|
|
Reuters
News
|
|
172
|
154
|
|
12 %
|
5 %
|
|
Global
Print
|
|
213
|
212
|
|
1 %
|
0 %
|
|
Corporate
costs
|
|
(115)
|
(293)
|
|
n/a
|
n/a
|
|
Adjusted
EBITDA
|
|
$2,678
|
$2,329
|
|
15 %
|
14 %
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
46.2 %
|
43.8 %
|
|
240bp
|
190bp
|
|
Corporates
|
|
38.1 %
|
37.6 %
|
|
50bp
|
50bp
|
|
Tax &
Accounting Professionals
|
|
45.8 %
|
45.8 %
|
|
0bp
|
-30bp
|
|
"Big 3" Segments
Combined(1)
|
|
43.8 %
|
42.4 %
|
|
140bp
|
110bp
|
|
Reuters
News
|
|
22.4 %
|
21.0 %
|
|
140bp
|
0bp
|
|
Global
Print
|
|
38.0 %
|
35.7 %
|
|
230bp
|
170bp
|
|
Adjusted EBITDA
margin
|
|
39.3 %
|
35.1 %
|
|
420bp
|
380bp
|
|
|
|
|
|
|
|
|
|
(1) See the
"Non-IFRS Financial Measures" section and the tables appended to
this news release for additional information on these and
other non-IFRS financial measures. To compute
segment and consolidated adjusted EBITDA margin, the company
excludes fair value
adjustments related to acquired deferred
revenues.
(2) Computed
for revenue growth only.
n/a: not
applicable
|
2024 Outlook
The company's outlook for 2024 in the table below assumes
constant currency rates and incorporates the recent Pagero and
World Business Media acquisitions but excludes the impact of any
future acquisitions or dispositions that may occur during the
remainder of the year. Thomson Reuters believes that this type of
guidance provides useful insight into the anticipated performance
of its businesses.
The company expects its first-quarter 2024 organic revenue
growth to be approximately 8%, boosted by the expectation for
additional AI licensing revenue at Reuters. The company also
anticipates an adjusted EBITDA margin of approximately 40%,
benefiting from normal seasonal strength and the Reuters licensing
revenue, partially offset by M&A dilution and select growth
investments.
The company continues to operate in an uncertain macroeconomic
environment, reflecting ongoing geopolitical risk, uneven economic
growth and an evolving interest rate and inflationary backdrop. Any
worsening of the global economic or business environment could
impact the company's ability to achieve its outlook.
Reported Full-Year 2023 Results and Full-Year 2024
Outlook
Total Thomson
Reuters
|
FY
2023
Reported
|
FY
2024
Outlook
|
Total Revenue
Growth
|
3 %
|
~ 6.5%
|
Organic Revenue
Growth(1)
|
6 %
|
~ 6%
|
Adjusted EBITDA
Margin(1)
|
39.3 %
|
~ 38%
|
Corporate
Costs
|
$115 million
|
$120 - $130
million
|
Free Cash
Flow(1)
|
$1.9 billion
|
~ $1.8
billion
|
Accrued Capex as % of
Revenue(1)
|
7.8 %
|
~ 8.5%
|
Depreciation &
Amortization of Computer Software
Depreciation & Amortization of Internally
Developed
Software
Amortization of Acquired Software
|
$628 million
$556 million
$72 million
|
$730 - $750
million
$595 - $615
million
~ $135
million
|
Interest Expense
(P&L)
|
$164
million(2)
|
$150 - $170
million
|
Effective Tax Rate on
Adjusted Earnings(1)
|
16.5 %
|
~ 18%
|
"Big 3"
Segments(1)
|
FY
2023
Reported
|
FY
2024
Outlook
|
Total Revenue
Growth
|
3 %
|
~ 8%
|
Organic Revenue
Growth
|
7 %
|
~ 7.5%
|
Adjusted EBITDA
Margin
|
43.8 %
|
~ 43%
|
|
|
(1)
|
Non-IFRS financial
measures. See the "Non-IFRS Financial Measures" section below as
well as the tables and footnotes appended to this news release for
more information.
|
(2)
|
Full-year 2023 interest
expense excludes a $12 million benefit from the release of a tax
reserve that is removed from adjusted earnings.
|
2025-2026 Financial Framework
For the 2025-2026 period, the company targets an organic revenue
growth range of 6.5%-8%, driven by 8%-9% for the "Big 3"
segments. The company targets adjusted EBITDA margin
expansion of approximately 75 basis points in 2025, followed by at
least 50 basis points in 2026. It anticipates accrued capital
expenditures as a percentage of revenues to be approximately 8%,
and 2026 free cash flow to range from $2.0-$2.1
billion.
This financial framework assumes constant currency rates and
incorporates the recent Pagero and World Business Media
acquisitions but excludes the impact of any future acquisitions or
dispositions that may occur during this time horizon.
The information in this section is forward-looking. Actual
results, which will include the impact of currency and future
acquisitions and dispositions completed during 2024,
2025 and 2026 may differ materially from the company's 2024
outlook and 2025-2026 financial framework. 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." The company's 2024
outlook and 2025-2026 financial framework are also based on certain
assumptions described in the cross-referenced section, which the
company believes are reasonable in the circumstances, and is
subject to a number of risks, including those specifically
identified in the cross-referenced section and those facing the
company generally.
Recent Acquisitions
In January 2024, the company
announced a recommended public tender offer to acquire 100 per cent
of the shares of Pagero Group AB (Pagero) and subsequently
acquired a majority interest in Pagero. As of February 2, 2024, the company's ownership of
Pagero was approximately 84.53%. Pagero is a global leader in
e-invoicing and indirect tax solutions, which it delivers through
its Smart Business Network. The Company links customers, suppliers,
and institutions, allowing for the automated, compliant, and secure
exchange of digital orders, invoices, and other business documents.
Thomson Reuters' majority ownership of Pagero will enhance the
strategic partnership announced in February
2023, accelerating the companies' joint vision for a
connected suite of global indirect tax, reporting and e-invoicing
capabilities.
In January 2024, the
company also acquired World Business Media Limited, a
cross-platform, subscription-based provider of editorial coverage
for the global P&C and specialty (re)insurance industry. This
acquisition is in line with Reuters strategic priority to provide
must-have news and insight for new customer markets and
professional verticals.
Dividends
The company announced today that its Board of Directors approved
a 10% or $0.20 per share annualized
increase in the dividend to $2.16 per
common share, representing the 31st consecutive year of
dividend increases. A quarterly dividend of $0.54 per share is payable on March 8, 2024 to common shareholders of record as
of February 21, 2024.
Share Repurchases – Update on $1.0
Billion Buyback Program
In November 2023, Thomson Reuters
announced its plans to repurchase up to $1.0
billion of its common shares.
From November 2023 through
January 31, 2024, the company
repurchased approximately 3.3 million of its common shares under
this buyback program, for a total spend of $457 million. As of January 31, 2024, Thomson Reuters had
approximately 452.4 million common shares outstanding.
Subject to market conditions, the company anticipates completing
the $1.0 billion program by the end
of the second quarter of 2024.
LSEG Ownership Interest
Thomson Reuters indirectly owns LSEG shares through an entity
that it jointly owns with Blackstone's consortium and a group of
current LSEG and former Refinitiv senior management. During 2023,
the company sold 56.0 million shares that it indirectly owned and
received nearly $5.5 billion of gross
proceeds.
As of January 31, 2024, Thomson
Reuters indirectly owned approximately 15.2 million LSEG shares,
which had a market value of approximately $1.7 billion based on LSEG's closing share price
on that day.
Thomson Reuters
Thomson Reuters (NYSE / TSX: TRI) informs the way forward
by bringing together the trusted content and technology that people
and organizations need to make the right decisions. The company
serves professionals across legal, tax, accounting, compliance,
government, and media. Its products combine highly specialized
software and insights to empower professionals with the data,
intelligence, and solutions needed to make informed decisions, and
to help institutions in their pursuit of justice, truth and
transparency. Reuters, part of Thomson Reuters, is a world leading
provider of trusted journalism and news. For more information,
visit tr.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, which include ratios that incorporate one or more
non-IFRS financial measures, such as adjusted EBITDA (other than at
the customer segment level) and the related margin, free cash flow,
adjusted earnings and the effective tax rate on adjusted earnings,
adjusted EPS, accrued capital expenditures expressed as a
percentage of revenues, selected measures excluding the impact of
foreign currency, changes in revenues computed on an organic basis
as well as all financial measures for the "Big 3" segments.
As of September 30, 2023,
Thomson Reuters amended its definition of adjusted earnings to
exclude amortization from acquired computer software. While
the company has always excluded amortization from acquired
identifiable intangible assets other than computer software from
its definition of adjusted earnings, this change aligns its
treatment of amortization for all acquired intangible assets. Prior
period amounts were revised for comparability.
Thomson Reuters uses these non-IFRS financial measures as
supplemental indicators of its operating performance and financial
position as well as for internal planning purposes and the
company's business outlook. Additionally, Thomson Reuters uses
non-IFRS measures as the basis for management incentive programs.
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 directly comparable
IFRS measures because it cannot predict, with reasonable certainty,
the 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 and foreign exchange
contracts. Additionally, the company cannot reasonably predict
(i) its share of post-tax earnings or 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 "2024 Outlook"
section, the "2025-2026 Financial Framework" section and the
company's expectations including the impact of its recent
acquisition of a majority ownership in Pagero and its acquisition
of World Business Media Limited and statements regarding the
company's anticipated completion of its buyback program in the
second quarter of 2024, 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 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.
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 19-33 in the "Risk
Factors" section of the company's 2022 annual report. 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 and 2025-2026 financial
framework 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, 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. In
particular, the global economy has experienced substantial
disruption due to concerns regarding economic effects associated
with the macroeconomic backdrop and ongoing geopolitical risks. The
company's business outlook and 2025-2026 financial framework
assumes that uncertain macroeconomic and geopolitical conditions
will continue to disrupt the economy and cause periods of
volatility, however, these conditions may last substantially longer
than expected and any worsening of the global economic or business
environment could impact the company's ability to achieve its
outlook and affect its results and other expectations. Material
assumptions related to the company's revenue outlook and 2025-2026
financial framework are that uncertain macroeconomic and
geopolitical conditions will continue to disrupt the economy and
cause periods of volatility; there will be a continued need for
trusted products and services that help customers navigate evolving
and complex legal, tax, accounting, regulatory, geopolitical and
commercial changes, developments and environments, and for
cloud-based digital tools that drive productivity; Thomson Reuters
will have a continued ability to deliver innovative products that
meet evolving customer demands; the company will acquire new
customers through expanded and improved digital platforms,
simplification of the product portfolio and through other sales
initiatives; and the company will improve customer retention
through commercial simplification efforts and customer service
improvements. Material assumptions related to the company's
adjusted EBITDA margin outlook and 2025-2026 financial framework
are its ability to achieve revenue growth targets; the company's
business mix continues to shift to higher-growth product offerings;
and integration expenses associated with recent acquisitions will
reduce margins. Material assumptions related to the company's free
cash flow outlook and 2025-2026 financial framework are its ability
to achieve its revenue and adjusted EBITDA margin targets; and
accrued capital expenditures approximate the percentage of revenues
as set forth in the company's
outlook. Material assumptions related to the company's
effective tax rate on adjusted earnings outlook are its ability to
achieve its adjusted EBITDA target; the mix of taxing jurisdictions
where the company recognized pre-tax profit or losses in 2023 does
not significantly change; no unexpected changes in tax laws or
treaties within the jurisdictions where the company operates;
significant gains that will prevent the imposition of certain
minimum taxes; no significant charges or benefits from the
finalization of prior tax years; depreciation and amortization of
internally developed computer software as set forth in the
company's outlook; and interest expense as set forth in the
company's outlook.
Material risks related to the company's revenue
outlook and 2025-2026 financial framework are that
ongoing geopolitical instability and uncertainty regarding interest
rates and inflation, continue to impact the global economy. The
severity and duration of any one, or a combination, of these
conditions could impact the global economy and lead to lower demand
for our products and services (beyond our assumption that these
disruptions will cause periods of
volatility); uncertainty in the legal regulatory
regime relating to AI has made it difficult for the company to
predict the risks associated with the use of AI in its businesses
and products. Future legislation may make it harder for the company
to conduct its business using AI, lead to regulatory fines or
penalties, require it to change its product offerings or business
practices or prevent or limit its use of AI; demand for the
company's products and services could be reduced by changes in
customer buying patterns or in its inability to execute on key
product design or customer support initiatives; competitive pricing
actions and product innovation could impact the company's revenues;
and the company's sales, commercial simplification and product
initiatives may be insufficient to retain customers or generate new
sales. Material risks related to the company's adjusted
EBITDA margin outlook and 2025-2026 financial framework
are the same as the risks above related to the revenue outlook;
higher than expected inflation may lead to greater than anticipated
increase in labor costs, third-party supplier costs and costs of
print materials; and acquisition and disposal activity may dilute
the company's adjusted EBITDA margin. Material risks related to the
company's free cash flow outlook are the same as the risks above
related to the revenue and adjusted EBITDA margin outlook; a weaker
macroeconomic environment could negatively impact working capital
performance, including the ability of the company's customers to
pay; accrued capital expenditures may be higher than currently
expected; and the timing and amount of tax payments to governments
may differ from the company's expectations. Material
risks related to the company's effective tax rate on adjusted
earnings outlook and 2025-2026 financial framework are the same as
the risks above related to adjusted EBITDA; a material change in
the geographical mix of the company's pre-tax profits and losses; a
material change in current tax laws or treaties to
which the company is subject, and did not expect; and depreciation
and amortization of internally developed computer software as well
as interest expense may be significantly higher or lower than
expected.
The company has provided an outlook and 2025-2026 financial
framework 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.
CONTACTS
MEDIA
Gehna Singh
Kareckas
Senior Director,
Corporate Affairs
+1 613 979
4272
gehna.singhkareckas@tr.com
|
INVESTORS
Gary Bisbee,
CFA
Head of Investor
Relations
+1 646 540
3249
gary.bisbee@tr.com
|
Thomson Reuters will webcast a discussion of its
fourth-quarter and full-year 2023 results and its 2024 business
outlook and 2025-2026 financial framework today
beginning at 9:00 a.m. Eastern Time
(ET). You can access the webcast by visiting ir.tr.com. An
archive of the webcast will be available following the
presentation.
Thomson Reuters
Corporation Consolidated Income
Statement (millions of U.S. dollars, except per share
data)
(unaudited)
|
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
December
31,
|
|
December
31,
|
|
2023
|
2022
|
|
2023
|
2022
|
CONTINUING
OPERATIONS
|
|
|
|
|
|
Revenues
|
$1,815
|
$1,765
|
|
$6,794
|
$6,627
|
Operating
expenses
|
(1,112)
|
(1,135)
|
|
(4,134)
|
(4,280)
|
Depreciation
|
(29)
|
(30)
|
|
(116)
|
(140)
|
Amortization of
computer software
|
(135)
|
(131)
|
|
(512)
|
(485)
|
Amortization of other
identifiable intangible assets
|
(25)
|
(23)
|
|
(97)
|
(99)
|
Other operating gains,
net
|
44
|
185
|
|
397
|
211
|
Operating
profit
|
558
|
631
|
|
2,332
|
1,834
|
Finance costs,
net:
|
|
|
|
|
|
Net interest
expense
|
(31)
|
(51)
|
|
(152)
|
(196)
|
Other finance (costs)
income
|
(117)
|
(418)
|
|
(192)
|
444
|
Income before tax and
equity method investments
|
410
|
162
|
|
1,988
|
2,082
|
Share of post-tax
earnings (losses) in equity method investments
|
260
|
120
|
|
1,075
|
(432)
|
Tax expense
|
(20)
|
(103)
|
|
(417)
|
(259)
|
Earnings from
continuing operations
|
650
|
179
|
|
2,646
|
1,391
|
Earnings (loss) from
discontinued operations, net of tax
|
28
|
39
|
|
49
|
(53)
|
Net earnings
|
$678
|
$218
|
|
$2,695
|
$1,338
|
Earnings attributable
to common shareholders
|
$678
|
$218
|
|
$2,695
|
$1,338
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
Basic earnings (loss)
per share:
|
|
|
|
|
|
From
continuing operations
|
$1.43
|
$0.37
|
|
$5.70
|
$2.87
|
From
discontinued operations
|
0.06
|
0.08
|
|
0.11
|
(0.11)
|
Basic earnings per
share
|
$1.49
|
$0.45
|
|
$5.81
|
$2.76
|
|
|
|
|
|
|
Diluted earnings (loss)
per share:
|
|
|
|
|
|
From
continuing operations
|
$1.43
|
$0.37
|
|
$5.69
|
$2.86
|
From
discontinued operations
|
0.06
|
0.08
|
|
0.11
|
(0.11)
|
Diluted earnings per
share
|
$1.49
|
$0.45
|
|
$5.80
|
$2.75
|
|
|
|
|
|
|
Basic weighted-average
common shares
|
454,510,754
|
478,603,748
|
|
463,175,043
|
483,885,501
|
Diluted
weighted-average common shares
|
455,173,945
|
479,516,003
|
|
463,970,070
|
484,929,605
|
Thomson Reuters
Corporation Consolidated Statement of Financial
Position (millions of U.S. dollars)
(unaudited)
|
|
|
|
|
|
December
31,
|
|
December
31,
|
2023
|
|
2022
|
Assets
|
|
|
|
Cash and cash
equivalents
|
$1,298
|
|
$1,069
|
Trade and other
receivables
|
1,122
|
|
1,069
|
Other financial
assets
|
66
|
|
204
|
Prepaid expenses and
other current assets
|
435
|
|
469
|
Current
assets
|
2,921
|
|
2,811
|
|
|
|
|
Property and equipment,
net
|
447
|
|
414
|
Computer software,
net
|
1,236
|
|
935
|
Other identifiable
intangible assets, net
|
3,165
|
|
3,219
|
Goodwill
|
6,719
|
|
5,869
|
Equity method
investments
|
2,030
|
|
6,199
|
Other financial
assets
|
444
|
|
527
|
Other non-current
assets
|
618
|
|
619
|
Deferred tax
|
1,104
|
|
1,118
|
Total
assets
|
$18,684
|
|
$21,711
|
|
|
|
|
Liabilities and
equity
|
|
|
|
Liabilities
|
|
|
|
Current
indebtedness
|
$372
|
|
$1,647
|
Payables, accruals and
provisions
|
1,114
|
|
1,222
|
Current tax
liabilities
|
248
|
|
324
|
Deferred
revenue
|
992
|
|
886
|
Other financial
liabilities
|
507
|
|
812
|
Current
liabilities
|
3,233
|
|
4,891
|
|
|
|
|
Long-term
indebtedness
|
2,905
|
|
3,114
|
Provisions and other
non-current liabilities
|
692
|
|
691
|
Other financial
liabilities
|
237
|
|
233
|
Deferred tax
|
553
|
|
897
|
Total
liabilities
|
7,620
|
|
9,826
|
|
|
|
|
Equity
|
|
|
|
Capital
|
3,405
|
|
5,398
|
Retained
earnings
|
8,680
|
|
7,642
|
Accumulated other
comprehensive loss
|
(1,021)
|
|
(1,155)
|
Total
equity
|
11,064
|
|
11,885
|
Total liabilities
and equity
|
$18,684
|
|
$21,711
|
Thomson Reuters
Corporation Consolidated Statement of Cash
Flow (millions of U.S. dollars)
(unaudited)
|
|
|
Three Months
Ended
December
31,
|
|
Year
Ended
December
31,
|
|
2023
|
2022
|
|
2023
|
2022
|
Cash provided by
(used in):
|
|
|
|
|
|
Operating
activities
|
|
|
|
|
|
Earnings from
continuing operations
|
$650
|
$179
|
|
$2,646
|
$1,391
|
Adjustments
for:
|
|
|
|
|
|
Depreciation
|
29
|
30
|
|
116
|
140
|
Amortization of
computer software
|
135
|
131
|
|
512
|
485
|
Amortization of other
identifiable intangible assets
|
25
|
23
|
|
97
|
99
|
Share of post-tax
(earnings) losses in equity method investments
|
(260)
|
(120)
|
|
(1,075)
|
432
|
Net losses (gains) on
disposals of businesses and investments
|
5
|
(188)
|
|
(336)
|
(217)
|
Deferred
tax
|
(19)
|
113
|
|
(388)
|
(80)
|
Other
|
110
|
466
|
|
298
|
(276)
|
Changes in working
capital and other items
|
40
|
43
|
|
457
|
8
|
Operating cash flows
from continuing operations
|
715
|
677
|
|
2,327
|
1,982
|
Operating cash flows
from discontinued operations
|
(10)
|
(1)
|
|
14
|
(67)
|
Net cash provided by
operating activities
|
705
|
676
|
|
2,341
|
1,915
|
Investing
activities
|
|
|
|
|
|
Acquisitions, net of
cash acquired
|
(15)
|
(1)
|
|
(1,216)
|
(191)
|
Proceeds from disposals
of businesses and investments
|
-
|
187
|
|
418
|
216
|
Proceeds from sales of
LSEG shares
|
31
|
19
|
|
5,424
|
43
|
Capital
expenditures
|
(132)
|
(135)
|
|
(544)
|
(595)
|
Other investing
activities
|
55
|
1
|
|
137
|
88
|
Taxes paid on sales of
LSEG shares and disposals of businesses
|
(162)
|
(7)
|
|
(705)
|
(7)
|
Investing cash flows
from continuing operations
|
(223)
|
64
|
|
3,514
|
(446)
|
Investing cash flows
from discontinued operations
|
-
|
-
|
|
(1)
|
(16)
|
Net cash (used in)
provided by investing activities
|
(223)
|
64
|
|
3,513
|
(462)
|
Financing
activities
|
|
|
|
|
|
Repayments of
debt
|
(600)
|
-
|
|
(600)
|
-
|
Net (repayments)
borrowings under short-term loan facilities
|
(513)
|
673
|
|
(956)
|
1,042
|
Payments of lease
principal
|
(14)
|
(15)
|
|
(58)
|
(65)
|
Payments for return of
capital on common shares
|
-
|
-
|
|
(2,045)
|
-
|
Repurchases of common
shares
|
(361)
|
(584)
|
|
(1,079)
|
(1,282)
|
Dividends paid on
preference shares
|
(1)
|
(1)
|
|
(5)
|
(3)
|
Dividends paid on
common shares
|
(215)
|
(207)
|
|
(887)
|
(834)
|
Other financing
activities
|
2
|
2
|
|
4
|
(14)
|
Net cash used in
financing activities
|
(1,702)
|
(132)
|
|
(5,626)
|
(1,156)
|
Translation
adjustments
|
2
|
2
|
|
1
|
(6)
|
(Decrease) increase in
cash and cash equivalents
|
(1,218)
|
610
|
|
229
|
291
|
Cash and cash
equivalents at beginning of period
|
2,516
|
459
|
|
1,069
|
778
|
Cash and cash
equivalents at end of period
|
$1,298
|
$1,069
|
|
$1,298
|
$1,069
|
|
|
|
|
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
|
|
Year
Ended
|
|
December
31,
|
|
December
31,
|
|
|
2023
|
2022
|
|
|
2023
|
2022
|
|
|
|
|
|
|
|
|
|
Earnings from
continuing operations
|
$650
|
$179
|
|
|
$2,646
|
$1,391
|
|
Adjustments to
remove:
|
|
|
|
|
|
|
|
Tax expense
|
20
|
103
|
|
|
417
|
259
|
|
Other finance costs
(income)
|
117
|
418
|
|
|
192
|
(444)
|
|
Net interest
expense
|
31
|
51
|
|
|
152
|
196
|
|
Amortization of other
identifiable intangible assets
|
25
|
23
|
|
|
97
|
99
|
|
Amortization of
computer software
|
135
|
131
|
|
|
512
|
485
|
|
Depreciation
|
29
|
30
|
|
|
116
|
140
|
|
EBITDA
|
$1,007
|
$935
|
|
|
$4,132
|
$2,126
|
|
Adjustments to
remove:
|
|
|
|
|
|
|
|
Share of post-tax
(earnings) losses in equity method investments
|
(260)
|
(120)
|
|
|
(1,075)
|
432
|
|
Other operating gains,
net
|
(44)
|
(185)
|
|
|
(397)
|
(211)
|
|
Fair value
adjustments*
|
4
|
3
|
|
|
18
|
(18)
|
|
Adjusted
EBITDA(1)
|
$707
|
$633
|
|
|
$2,678
|
$2,329
|
|
Adjusted EBITDA
margin(1)
|
38.9 %
|
35.9 %
|
|
|
39.3 %
|
35.1 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Fair
value adjustments primarily represent gains or losses on
intercompany balances that arise in the ordinary course of business
due to changes in foreign currency exchange rates, which are a
component of operating expenses, as well as adjustments related to
acquired deferred revenue.
|
Thomson Reuters
Corporation
|
|
Reconciliation of
Net Cash Provided By Operating Activities to Free Cash
Flow(1)
|
|
(millions of U.S.
dollars)
|
|
(unaudited)
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
December
31,
|
|
December
31,
|
|
|
2023
|
2022
|
|
2023
|
2022
|
|
Net cash provided by
operating activities
|
$705
|
$676
|
|
$2,341
|
$1,915
|
|
Capital
expenditures
|
(132)
|
(135)
|
|
(544)
|
(595)
|
|
Other investing
activities
|
55
|
1
|
|
137
|
88
|
|
Payments of lease
principal
|
(14)
|
(15)
|
|
(58)
|
(65)
|
|
Dividends paid on
preference shares
|
(1)
|
(1)
|
|
(5)
|
(3)
|
|
Free cash
flow(1)
|
$613
|
$526
|
|
$1,871
|
$1,340
|
|
Thomson Reuters
Corporation
|
Reconciliation of
Capital Expenditures to Accrued Capital
Expenditures(1)
|
(millions of
U.S. dollars)
|
(unaudited)
|
|
|
|
Year
Ended
|
|
|
December
31,
|
|
|
|
|
2023
|
Capital
expenditures
|
|
|
|
$544
|
Remove: IFRS adjustment
to cash basis
|
|
|
|
(12)
|
Accrued capital
expenditures (1)
|
|
|
|
$532
|
Accrued capital
expenditures as a percentage of
revenues(1)
|
|
|
|
7.8 %
|
|
|
|
|
|
(1) Refer to page
22 for additional information on non-IFRS financial
measures.
|
Thomson Reuters
Corporation
|
Reconciliation of
Net Earnings to Adjusted
Earnings(1)
|
Reconciliation of
Total Change in Adjusted EPS to Change in Constant
Currency(1)
|
(millions of
U.S. dollars, except for share and per
share data)
|
(unaudited)
|
|
|
Three Months
Ended
December
31,
|
Year
Ended
December
31,
|
|
|
2023
|
2022
|
|
2023
|
2022
|
Net
earnings
|
$678
|
$218
|
|
$2,695
|
$1,338
|
Adjustments to
remove:
|
|
|
|
|
|
Fair value
adjustments*
|
4
|
3
|
|
18
|
(18)
|
Amortization of
acquired computer software
|
24
|
12
|
|
72
|
39
|
Amortization of other
identifiable intangible assets
|
25
|
23
|
|
97
|
99
|
Other operating gains,
net
|
(44)
|
(185)
|
|
(397)
|
(211)
|
Interest benefit
impacting comparability(2)
|
-
|
-
|
|
(12)
|
-
|
Other finance costs
(income)
|
117
|
418
|
|
192
|
(444)
|
Share of post-tax
(earnings) losses in equity method investments
|
(260)
|
(120)
|
|
(1,075)
|
432
|
Tax on above
items(1)
|
38
|
(24)
|
|
265
|
(30)
|
Tax items impacting
comparability(1)(2)
|
(108)
|
60
|
|
(172)
|
15
|
(Earnings) loss from
discontinued operations, net of tax
|
(28)
|
(39)
|
|
(49)
|
53
|
Interim period
effective tax rate normalization(1)
|
1
|
(3)
|
|
-
|
-
|
Dividends declared on
preference shares
|
(1)
|
(1)
|
|
(5)
|
(3)
|
Adjusted
earnings(1)
|
$446
|
$362
|
|
$1,629
|
$1,270
|
Adjusted
EPS(1)
|
$0.98
|
$0.75
|
|
$3.51
|
$2.62
|
Total
change
|
31 %
|
|
|
34 %
|
|
Foreign
currency
|
3 %
|
|
|
2 %
|
|
Constant
currency
|
28 %
|
|
|
32 %
|
|
|
|
|
|
|
|
Diluted
weighted-average common shares (millions)
|
455.2
|
479.5
|
|
464.0
|
484.9
|
Reconciliation of
Effective Tax Rate on Adjusted
Earnings(1)
|
Year-ended
December 31,
|
|
2023
|
Adjusted
earnings
|
$1,629
|
Plus: Dividends
declared on preference shares
|
5
|
Plus: Tax expense on
adjusted earnings
|
324
|
Pre-Tax Adjusted
earnings
|
$1,958
|
|
|
IFRS Tax
expense
|
$417
|
Remove tax related
to:
|
|
Amortization of acquired computer software
|
17
|
Amortization of other identifiable intangible assets
|
22
|
Share of
post-tax earnings in equity method investments
|
(253)
|
Other
finance costs
|
31
|
Other
operating gains, net
|
(81)
|
Other
items
|
(1)
|
Subtotal – Remove tax
expense on pre-tax items removed from adjusted earnings
|
(265)
|
Remove: Tax items
impacting comparability
|
172
|
Total: Remove all items
impacting comparability
|
(93)
|
Tax expense on
adjusted earnings
|
$324
|
Effective tax rate
on adjusted earnings
|
16.5 %
|
|
* Fair value
adjustments primarily represent gains or losses on
intercompany balances that arise in the ordinary course of business
due to changes in foreign currency exchange rates, which are a
component of operating expenses, as well as adjustments related to
acquired deferred revenue.
|
|
(1) Refer to page
22 for additional information on non-IFRS financial
measures.
|
(2) The year
ended December 31, 2023, included the release of tax and interest
reserves due to the expiration of statutes of
limitation.
|
Thomson Reuters
Corporation
|
Reconciliation of
Changes in Revenues to Changes in Revenues on a Constant
Currency(1) and Organic
Basis(1)
|
(millions of
U.S. dollars)
|
(unaudited)
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
December
31,
|
|
Change
|
|
|
2023
|
2022
|
|
Total
|
Foreign
Currency
|
SUBTOTAL
Constant
Currency
|
Net
Acquisitions/
(Divestitures)
|
Organic
|
|
Total
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$700
|
$704
|
|
-1 %
|
0 %
|
-1 %
|
-7 %
|
7 %
|
|
Corporates
|
|
402
|
379
|
|
6 %
|
1 %
|
5 %
|
-1 %
|
7 %
|
|
Tax &
Accounting Professionals
|
|
344
|
326
|
|
6 %
|
-3 %
|
9 %
|
-1 %
|
10 %
|
|
"Big 3" Segments
Combined(1)
|
|
1,446
|
1,409
|
|
3 %
|
-1 %
|
3 %
|
-4 %
|
8 %
|
|
Reuters
News
|
|
220
|
198
|
|
11 %
|
1 %
|
10 %
|
2 %
|
9 %
|
|
Global
Print
|
|
154
|
162
|
|
-6 %
|
-1 %
|
-5 %
|
-1 %
|
-4 %
|
|
Eliminations/Rounding
|
|
(5)
|
(4)
|
|
|
|
|
|
|
|
Revenues
|
|
$1,815
|
$1,765
|
|
3 %
|
0 %
|
3 %
|
-3 %
|
7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Recurring
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$674
|
$664
|
|
2 %
|
0 %
|
2 %
|
-5 %
|
7 %
|
|
Corporates
|
|
358
|
337
|
|
6 %
|
1 %
|
6 %
|
-1 %
|
7 %
|
|
Tax &
Accounting Professionals
|
|
305
|
292
|
|
5 %
|
-3 %
|
8 %
|
-2 %
|
10 %
|
|
"Big 3" Segments
Combined(1)
|
|
1,337
|
1,293
|
|
3 %
|
-1 %
|
4 %
|
-3 %
|
8 %
|
|
Reuters
News
|
|
157
|
153
|
|
3 %
|
-1 %
|
3 %
|
1 %
|
2 %
|
|
Eliminations/Rounding
|
|
(5)
|
(4)
|
|
|
|
|
|
|
|
Total Recurring
Revenues
|
|
$1,489
|
$1,442
|
|
3 %
|
-1 %
|
4 %
|
-3 %
|
7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Transactions
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$26
|
$40
|
|
-36 %
|
3 %
|
-39 %
|
-41 %
|
2 %
|
|
Corporates
|
|
44
|
42
|
|
6 %
|
2 %
|
4 %
|
-3 %
|
7 %
|
|
Tax &
Accounting Professionals
|
|
39
|
34
|
|
15 %
|
-7 %
|
22 %
|
8 %
|
14 %
|
|
"Big 3" Segments
Combined(1)
|
|
109
|
116
|
|
-6 %
|
0 %
|
-6 %
|
-14 %
|
8 %
|
|
Reuters
News
|
|
63
|
45
|
|
39 %
|
5 %
|
34 %
|
3 %
|
31 %
|
|
Total Transactions
Revenues
|
|
$172
|
$161
|
|
7 %
|
1 %
|
6 %
|
-10 %
|
16 %
|
|
|
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.
|
|
(1) Refer to page
22 for additional information on non-IFRS financial
measures.
|
Thomson Reuters
Corporation
|
Reconciliation of
Changes in Revenues to Changes in Revenues on a Constant
Currency(1) and Organic
Basis(1)
|
(millions of U.S.
dollars)
|
(unaudited)
|
|
|
|
|
Year
Ended
|
|
|
|
|
|
|
|
|
December
31,
|
|
Change
|
|
|
2023
|
2022
|
|
Total
|
Foreign
Currency
|
SUBTOTAL
Constant
Currency
|
Net
Acquisitions/
(Divestitures)
|
Organic
|
|
Total
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$2,807
|
$2,803
|
|
0 %
|
0 %
|
0 %
|
-6 %
|
6 %
|
|
Corporates
|
|
1,620
|
1,536
|
|
5 %
|
0 %
|
5 %
|
-2 %
|
7 %
|
|
Tax &
Accounting Professionals
|
|
1,058
|
986
|
|
7 %
|
-2 %
|
9 %
|
-1 %
|
10 %
|
|
"Big 3" Segments
Combined(1)
|
|
5,485
|
5,325
|
|
3 %
|
0 %
|
4 %
|
-4 %
|
7 %
|
|
Reuters
News
|
|
769
|
733
|
|
5 %
|
0 %
|
5 %
|
1 %
|
4 %
|
|
Global
Print
|
|
562
|
592
|
|
-5 %
|
-1 %
|
-4 %
|
-1 %
|
-3 %
|
|
Eliminations/Rounding
|
|
(22)
|
(23)
|
|
|
|
|
|
|
|
Revenues
|
|
$6,794
|
$6,627
|
|
3 %
|
0 %
|
3 %
|
-3 %
|
6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Recurring
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$2,674
|
$2,631
|
|
2 %
|
0 %
|
2 %
|
-4 %
|
6 %
|
|
Corporates
|
|
1,373
|
1,305
|
|
5 %
|
0 %
|
5 %
|
-2 %
|
8 %
|
|
Tax &
Accounting Professionals
|
|
808
|
799
|
|
1 %
|
-2 %
|
3 %
|
-6 %
|
9 %
|
|
"Big 3" Segments
Combined(1)
|
|
4,855
|
4,735
|
|
3 %
|
0 %
|
3 %
|
-4 %
|
7 %
|
|
Reuters
News
|
|
625
|
612
|
|
2 %
|
0 %
|
3 %
|
1 %
|
2 %
|
|
Eliminations/Rounding
|
|
(22)
|
(23)
|
|
|
|
|
|
|
|
Total Recurring
Revenues
|
|
$5,458
|
$5,324
|
|
3 %
|
0 %
|
3 %
|
-3 %
|
6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Transactions
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$133
|
$172
|
|
-23 %
|
0 %
|
-23 %
|
-30 %
|
7 %
|
|
Corporates
|
|
247
|
231
|
|
7 %
|
0 %
|
7 %
|
1 %
|
5 %
|
|
Tax &
Accounting Professionals
|
|
250
|
187
|
|
34 %
|
-3 %
|
37 %
|
20 %
|
17 %
|
|
"Big 3" Segments
Combined(1)
|
|
630
|
590
|
|
7 %
|
-1 %
|
8 %
|
-2 %
|
10 %
|
|
Reuters
News
|
|
144
|
121
|
|
19 %
|
4 %
|
14 %
|
1 %
|
13 %
|
|
Total Transactions
Revenues
|
|
$774
|
$711
|
|
9 %
|
0 %
|
9 %
|
-2 %
|
10 %
|
|
|
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.
|
|
(1) Refer to page
22 for additional information on non-IFRS financial
measures.
|
Thomson Reuters
Corporation
|
Reconciliation of
Changes in Adjusted EBITDA(1) and Related
Margin(1) to Changes on a Constant
Currency Basis(1)
|
(millions of
U.S. dollars, except for
margins)
|
(unaudited)
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
December
31,
|
|
Change
|
|
|
|
2023
|
2022
|
|
Total
|
Foreign
Currency
|
Constant
Currency
|
|
Adjusted
EBITDA(1)
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$298
|
$294
|
|
1 %
|
3 %
|
-2 %
|
|
Corporates
|
|
138
|
135
|
|
3 %
|
1 %
|
1 %
|
|
Tax &
Accounting Professionals
|
|
188
|
189
|
|
-1 %
|
-2 %
|
1 %
|
|
"Big 3" Segments
Combined(1)
|
|
624
|
618
|
|
1 %
|
1 %
|
0 %
|
|
Reuters
News
|
|
61
|
40
|
|
56 %
|
4 %
|
52 %
|
|
Global
Print
|
|
55
|
59
|
|
-5 %
|
3 %
|
-8 %
|
|
Corporate
costs
|
|
(33)
|
(84)
|
|
n/a
|
n/a
|
n/a
|
|
Adjusted
EBITDA
|
|
$707
|
$633
|
|
12 %
|
2 %
|
9 %
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin(1)
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
42.5 %
|
41.7 %
|
|
80bp
|
130bp
|
-50bp
|
|
Corporates
|
|
34.5 %
|
35.7 %
|
|
-120bp
|
20bp
|
-140bp
|
|
Tax &
Accounting Professionals
|
|
54.6 %
|
58.1 %
|
|
-350bp
|
80bp
|
-430bp
|
|
"Big 3" Segments
Combined(1)
|
|
43.1 %
|
43.9 %
|
|
-80bp
|
70bp
|
-150bp
|
|
Reuters
News
|
|
27.9 %
|
19.8 %
|
|
810bp
|
90bp
|
720bp
|
|
Global
Print
|
|
36.4 %
|
36.1 %
|
|
30bp
|
130bp
|
-100bp
|
|
Adjusted EBITDA
margin
|
|
38.9 %
|
35.9 %
|
|
300bp
|
90bp
|
210bp
|
|
Thomson Reuters
Corporation
|
Reconciliation of
Changes in Adjusted EBITDA(1) and Related
Margin(1) to Changes on a Constant
Currency Basis(1)
|
(millions of
U.S. dollars, except for
margins)
|
(unaudited)
|
|
|
|
|
Year
Ended
|
|
|
|
|
December
31,
|
|
Change
|
|
|
|
2023
|
2022
|
|
Total
|
Foreign
Currency
|
Constant
Currency
|
|
Adjusted
EBITDA(1)
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$1,299
|
$1,227
|
|
6 %
|
1 %
|
5 %
|
|
Corporates
|
|
619
|
578
|
|
7 %
|
0 %
|
7 %
|
|
Tax &
Accounting Professionals
|
|
490
|
451
|
|
8 %
|
-1 %
|
10 %
|
|
"Big 3" Segments
Combined(1)
|
|
2,408
|
2,256
|
|
7 %
|
0 %
|
6 %
|
|
Reuters
News
|
|
172
|
154
|
|
12 %
|
7 %
|
5 %
|
|
Global
Print
|
|
213
|
212
|
|
1 %
|
1 %
|
0 %
|
|
Corporate
costs
|
|
(115)
|
(293)
|
|
n/a
|
n/a
|
n/a
|
|
Adjusted
EBITDA
|
|
$2,678
|
$2,329
|
|
15 %
|
1 %
|
14 %
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin(1)
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
46.2 %
|
43.8 %
|
|
240bp
|
50bp
|
190bp
|
|
Corporates
|
|
38.1 %
|
37.6 %
|
|
50bp
|
0bp
|
50bp
|
|
Tax &
Accounting Professionals
|
|
45.8 %
|
45.8 %
|
|
0bp
|
30bp
|
-30bp
|
|
"Big 3" Segments
Combined(1)
|
|
43.8 %
|
42.4 %
|
|
140bp
|
30bp
|
110bp
|
|
Reuters
News
|
|
22.4 %
|
21.0 %
|
|
140bp
|
140bp
|
0bp
|
|
Global
Print
|
|
38.0 %
|
35.7 %
|
|
230bp
|
60bp
|
170bp
|
|
Adjusted EBITDA
margin
|
|
39.3 %
|
35.1 %
|
|
420bp
|
40bp
|
380bp
|
|
|
|
|
|
|
|
|
|
|
|
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.
|
(1) Refer to page
22 for additional information on non-IFRS financial
measures.
|
Reconciliation of adjusted EBITDA
margin(1)
To compute segment and consolidated adjusted EBITDA margin, we
exclude fair value adjustments related to acquired deferred revenue
from our IFRS revenues. The chart below reconciles IFRS revenues to
revenues used in the calculation of adjusted EBITDA margin, which
excludes fair value adjustments related to acquired deferred
revenue.
Three months ended
December 31, 2023
|
|
IFRS
revenues
|
Remove fair
value
adjustments to
acquired deferred
revenue
|
Revenues
excluding
fair value
adjustments to
acquired deferred
revenue
|
Adjusted
EBITDA
|
Adjusted EBITDA
Margin
|
|
Legal
Professionals
|
$700
|
$1
|
$701
|
$298
|
42.5 %
|
|
Corporates
|
402
|
-
|
402
|
138
|
34.5 %
|
|
Tax & Accounting
Professionals
|
344
|
-
|
344
|
188
|
54.6 %
|
|
"Big 3" Segments
Combined
|
1,446
|
1
|
1,447
|
624
|
43.1 %
|
|
Reuters News
|
220
|
-
|
220
|
61
|
27.9 %
|
|
Global Print
|
154
|
-
|
154
|
55
|
36.4 %
|
|
Eliminations/
Rounding
|
(5)
|
-
|
(5)
|
-
|
n/a
|
|
Corporate
costs
|
-
|
-
|
-
|
(33)
|
n/a
|
|
Consolidated
totals
|
$1,815
|
$1
|
$1,816
|
$707
|
38.9 %
|
|
|
Year ended December
31, 2023
|
|
IFRS
revenues
|
Remove fair
value
adjustments to
acquired deferred
revenue
|
Revenues
excluding
fair value
adjustments to
acquired deferred
revenue
|
Adjusted
EBITDA
|
Adjusted EBITDA
Margin
|
|
Legal
Professionals
|
$2,807
|
$1
|
$2,808
|
$1,299
|
46.2 %
|
|
Corporates
|
1,620
|
3
|
1,623
|
619
|
38.1 %
|
|
Tax & Accounting
Professionals
|
1,058
|
11
|
1,069
|
490
|
45.8 %
|
|
"Big 3" Segments
Combined
|
5,485
|
15
|
5,500
|
2,408
|
43.8 %
|
|
Reuters News
|
769
|
1
|
770
|
172
|
22.4 %
|
|
Global Print
|
562
|
-
|
562
|
213
|
38.0 %
|
|
Eliminations/
Rounding
|
(22)
|
-
|
(22)
|
-
|
n/a
|
|
Corporate
costs
|
-
|
-
|
-
|
(115)
|
n/a
|
|
Consolidated
totals
|
$6,794
|
$16
|
$6,810
|
$2,678
|
39.3 %
|
|
|
Margins are computed
using whole dollars, as a result, margins calculated from reported
amounts may differ from those presented due to
rounding.
|
n/a: not
applicable
|
|
(1) Refer to page
22 for additional information on non-IFRS financial
measures.
|
Non-IFRS Financial
Measures
|
Definition
|
Why Useful to the
Company and Investors
|
Adjusted EBITDA and the
related margin
|
Represents 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 and fair value adjustments, including those
related to acquired deferred revenue.
The related margin is
adjusted EBITDA expressed as a percentage of revenues. For purposes
of this calculation, revenues are before fair value adjustments to
acquired deferred revenue.
|
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.
Also, represents a
measure commonly reported and widely used by investors as a
valuation metric, as well as to assess the company's ability to
incur and service debt.
|
Adjusted earnings and
adjusted EPS
|
Net earnings or loss
including dividends declared on preference shares but excluding the
post-tax impacts of fair value adjustments, including those related
to acquired deferred revenue, amortization of acquired intangible
assets (attributable to other identifiable intangible assets and
acquired computer software), 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. Acquired intangible assets contribute to
the generation of revenues from acquired companies, which are
included in our computation of adjusted earnings.
The post-tax amount of
each item is 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.
|
Provides a more
comparable basis to analyze earnings.
These measures are
commonly used by shareholders to measure performance.
|
Effective tax rate on
adjusted earnings
|
Adjusted tax expense
divided by pre-tax adjusted earnings. Adjusted tax expense is
computed as income tax (benefit) expense plus or minus the income
tax impacts of all items impacting adjusted earnings (as described
above), and other tax items impacting comparability.
In interim periods, we
also make an adjustment to reflect income taxes based on the
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.
|
Provides a basis to
analyze the effective tax rate associated with adjusted
earnings.
Because the
geographical mix of pre-tax profits and losses in interim periods
may be different from that for the full year, our effective tax
rate computed in accordance with IFRS may be more volatile by
quarter. Therefore, we believe that using the expected full-year
effective tax rate provides more comparability among interim
periods.
|
Free cash
flow
|
Net cash provided by
operating activities and other investing activities, less capital
expenditures, payments of lease principal and dividends paid on the
company's preference shares.
|
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
acquisitions.
|
Changes before the
impact of foreign currency or at "constant currency"
|
The changes in
revenues, adjusted EBITDA and the related margin, and adjusted EPS
before currency (at constant currency or excluding the effects of
currency) are determined by converting the current and equivalent
prior period's local currency results using the same foreign
currency exchange rate.
|
Provides better
comparability of business trends from period to period.
|
Changes in revenues
computed on an "organic" basis
|
Represent changes in
revenues of the company's existing businesses at constant currency.
The metric excludes the distortive impacts of acquisitions and
dispositions from not owning the business in both comparable
periods.
|
Provides further
insight into the performance of the company's 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.
|
Accrued capital
expenditures as a percentage of revenues
|
Accrued capital
expenditures divided by revenues, where accrued capital
expenditures include amounts that remain unpaid at the end of the
reporting period. For purposes of this calculation, revenues are
before fair value adjustments to acquired deferred
revenue.
|
Reflects the basis on
which the company manages capital expenditures for internal
budgeting purposes.
|
"Big 3"
segments
|
The company's combined
Legal Professionals, Corporates and Tax & Accounting
Professionals segments. All measures reported for the "Big 3"
segments are non-IFRS financial measures.
|
The "Big 3" segments
comprised approximately 80% of revenues and represent the core of
the company's business information service product
offerings.
|
Please refer to reconciliations for the most directly
comparable IFRS financial measures.
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SOURCE Thomson Reuters