Thomson Reuters Reports Fourth-Quarter and Full-Year 2024 Results
TORONTO, Feb. 6, 2025 /PRNewswire/ -- Thomson Reuters (TSX/NYSE:TRI) today reported results for the fourth quarter and full year ended December 31, 2024:
- Good revenue momentum continued in the fourth quarter and full year
- Full-year total company and organic revenues up 7%
- Fourth-quarter total company and organic revenues up 5%
- Organic revenues up 8% for the "Big 3" segments (Legal Professionals, Corporates and Tax & Accounting Professionals)
- Met full-year 2024 outlook for total company organic revenue growth, adjusted EBITDA margin and free cash flow; Met "Big 3" organic revenue growth outlook
- Full-year 2025 outlook anticipates organic revenue growth of approximately 7.0 - 7.5% and an adjusted EBITDA margin of approximately 39%
- Updated financial framework for 2026 anticipates 7.5% - 8.0% organic revenue growth and 50 basis points or more of adjusted EBITDA margin expansion
- Increased annualized dividend per share by 10% (32nd consecutive annual increase)
- Acquired SafeSend to expand tax automation capabilities for $600 million in January 2025
"2024 marked important progress at Thomson Reuters," said Steve Hasker, President and CEO of Thomson Reuters. "We continue to deliver on the ambitious innovation roadmap we shared at our 2024 investor day, highlighted by the launch of new product capabilities and enhancements throughout our portfolio. Looking ahead to 2025, we continue to focus on investing in content-driven technology that helps professionals make complex decisions with confidence."
Mr. Hasker added, "We remain focused on allocating capital to drive long-term shareholder value creation. In 2024, we continued to return capital to shareholders, completed the monetization of our London Stock Exchange Group stake and executed several 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)
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IFRS Financial Measures(1) | 2024 | 2023 | Change | Change at |
Revenues | $1,909 | $1,815 | 5 % | |
Operating profit | $722 | $558 | 29 % | |
Diluted earnings per share (EPS) | $1.30 | $1.49 | -13 % | |
Net cash provided by operating activities | $564 | $705 | -20 % | |
Non-IFRS Financial Measures(1) | ||||
Revenues | $1,909 | $1,815 | 5 % | 5 % |
Adjusted EBITDA | $718 | $707 | 2 % | 1 % |
Adjusted EBITDA margin | 37.6 % | 38.9 % | -130bp | -160bp |
Adjusted EPS | $1.01 | $0.98 | 3 % | 1 % |
Free cash flow | $425 | $613 | -31 % | |
(1) In addition to results reported in accordance with International Financial Reporting Standards (IFRS), the company uses certain non-IFRS | ||||
Revenues increased 5% due to 7% growth in recurring revenues (83% of total revenues) partly offset by a 1% decline in transactions revenues and a 6% decline in Global Print. The net impact of acquisitions and disposals as well as foreign currency on total company revenue growth was not significant.
- Organic revenues increased 5% due to 8% growth in recurring revenues partly offset by a 4% decline in transactions revenues and the decline in Global Print.
- The company's "Big 3" segments reported organic revenue growth of 8% and collectively comprised 81% of total revenues.
Operating profit increased 29% driven from gains on the sale of FindLaw and other non-core businesses.
- Adjusted EBITDA, which excludes gains on the sale of businesses, as well as other items, increased 2% and the related margin decreased to 37.6% from 38.9% in the prior-year period. The increase in revenues were largely offset by higher costs reflecting continued investments in the business, the impact of acquisitions and higher incentive compensation. Foreign currency had a 30 basis points positive impact on the year-over-year change in adjusted EBITDA margin.
Diluted EPS decreased to $1.30 compared to $1.49 in the prior-year period as higher operating profit and currency benefits included in other finance income or costs were more than offset by higher tax expense, lower results from discontinued operations and a prior-year period increase in the value of the company's former investment in London Stock Exchange Group (LSEG).
- Adjusted EPS, which exclude gains on the sale of businesses, other finance income or costs, changes in value of the company's former LSEG investment, discontinued operations, as well as other adjustments, was $1.01 per share versus $0.98 per share in the prior-year period.
Net cash provided by operating activities decreased by $141 million primarily due to certain component changes in working capital.
- Free cash flow decreased by $188 million primarily due to the decrease in cash flows from operating activities and higher capital expenditures.
Highlights by Customer Segment – Three Months Ended December 31
(Millions of U.S. dollars, except for adjusted EBITDA margins) (unaudited)
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Three Months Ended | |||||||
December 31, | Change | ||||||
2024 | 2023 | Total | Constant |
Organic(1)(2) | |||
Revenues | |||||||
Legal Professionals | $729 | $700 | 4 % | 4 % | 7 % | ||
Corporates | 458 | 402 | 14 % | 15 % | 10 % | ||
Tax & Accounting Professionals | 366 | 344 | 6 % | 7 % | 7 % | ||
"Big 3" Segments Combined(1) | 1,553 | 1,446 | 7 % | 7 % | 8 % | ||
Reuters News | 218 | 220 | -1 % | -1 % | -3 % | ||
Global Print | 144 | 154 | -6 % | -6 % | -6 % | ||
Eliminations/Rounding | (6) | (5) | |||||
Revenues | $1,909 | $1,815 | 5 % | 5 % | 5 % | ||
Adjusted EBITDA(1) | |||||||
Legal Professionals | $299 | $298 | 0 % | -1 % | |||
Corporates | 153 | 138 | 11 % | 8 % | |||
Tax & Accounting Professionals | 196 | 188 | 4 % | 5 % | |||
"Big 3" Segments Combined(1) | 648 | 624 | 4 % | 3 % | |||
Reuters News | 45 | 61 | -26 % | -26 % | |||
Global Print | 55 | 55 | -1 % | -1 % | |||
Corporate costs | (30) | (33) | n/a | n/a | |||
Adjusted EBITDA | $718 | $707 | 2 % | 1 % | |||
Adjusted EBITDA Margin(1) | |||||||
Legal Professionals | 41.0 % | 42.5 % | -150bp | -200bp | |||
Corporates | 33.5 % | 34.5 % | -100bp | -190bp | |||
Tax & Accounting Professionals | 53.4 % | 54.6 % | -120bp | -90bp | |||
"Big 3" Segments Combined(1) | 41.7 % | 43.1 % | -140bp | -190bp | |||
Reuters News | 20.8 % | 27.9 % | -710bp | -670bp | |||
Global Print | 38.2 % | 36.4 % | 180bp | 190bp | |||
Adjusted EBITDA margin | 37.6 % | 38.9 % | -130bp | -160bp | |||
(1) See the "Non-IFRS Financial Measures" section and the tables appended to this news release for additional information on these and (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 (which excludes the impact of foreign currency) as Thomson Reuters believes this provides the best basis to measure performance.
Legal Professionals
Revenues increased 4% to $729 million and included a negative impact from the divestiture of FindLaw. Organic revenue growth was 7%.
- Recurring revenues increased 4% (97% of total, 8% organic). Organic revenue growth was primarily driven by Westlaw, CoCounsel, Practical Law, and the segment's international businesses.
- Transactions revenues decreased 10% (3% of total, decreased 4% organic).
Adjusted EBITDA was slightly higher at $299 million.
- The margin decreased to 41.0% from 42.5% primarily driven by higher investments.
Corporates
Revenues increased 15% to $458 million, including the acquisition impact of Pagero. Organic revenue growth was 10%.
- Recurring revenues increased 13% (88% of total, 10% organic). Organic revenue growth was primarily driven by Practical Law, Indirect Tax, CLEAR and the segment's international businesses.
- Transactions revenues increased 28% (12% of total, 12% organic) driven primarily by Pagero, Direct Tax and Trust.
Adjusted EBITDA increased 11% to $153 million.
- The margin decreased to 33.5% from 34.5%, primarily driven by the Pagero acquisition and higher investments.
Tax & Accounting Professionals
Revenues increased 7%, all organic, to $366 million.
- Recurring revenues increased 5% (87% of total, all organic). Organic revenue growth was driven by the segment's Latin America business and UltraTax products.
- Transactions revenues increased 21% (13% of total, all organic) driven by tax products and professional services.
Adjusted EBITDA increased 4% to $196 million.
- The margin decreased to 53.4% from 54.6%, primarily driven by higher investments.
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 $218 million decreased 1% (decreased 3% organic) and included a positive impact from acquisitions. The organic revenue decline primarily reflected generative AI related content licensing revenue included in the prior-year period that was largely transactional in nature, partially offset by higher agency revenues and a contractual price increase from our news agreement with the Data & Analytics business of LSEG.
Adjusted EBITDA decreased 26% to $45 million primarily due to lower transactions revenues and higher costs including editorial coverage of key global events in the quarter.
Global Print
Revenues of $144 million decreased 6%, all organic, driven by lower shipment volumes and the migration of customers from a Global Print product to Westlaw.
Adjusted EBITDA was $55 million, unchanged from the prior-year period.
- The margin increased to 38.2% from 36.4% primarily due to lower costs.
Corporate Costs
Corporate costs were $30 million compared to $33 million in the prior-year period.
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) | 2024 | 2023 | Change | Change at |
Revenues | $7,258 | $6,794 | 7 % | |
Operating profit | $2,109 | $2,332 | -10 % | |
Diluted EPS | $4.89 | $5.80 | -16 % | |
Net cash provided by operating activities | $2,457 | $2,341 | 5 % | |
Non-IFRS Financial Measures(1) | ||||
Revenues | $7,258 | $6,794 | 7 % | 7 % |
Adjusted EBITDA | $2,779 | $2,678 | 4 % | 4 % |
Adjusted EBITDA margin | 38.2 % | 39.3 % | -110bp | -130bp |
Adjusted EPS | $3.77 | $3.51 | 7 % | 7 % |
Free cash flow | $1,828 | $1,871 | -2 % | |
(1) In addition to results reported in accordance with IFRS, the company uses certain non-IFRS financial measures as supplemental | ||||
Revenues increased 7% due to 8% growth in recurring revenues (81% of total revenues) and 11% growth in transactions revenues, partly offset by an 8% decline in Global Print. The net impact of acquisitions and disposals as well as foreign currency on total company revenue growth was not significant.
- Organic revenues increased 7% due to 8% growth in recurring revenues and 10% growth in transactions revenues. Global Print revenues decreased 7% organically.
- The company's "Big 3" segments reported organic revenue growth of 9% and collectively comprised 82% of total revenues.
Operating profit decreased 10%, primarily due to lower gains from the sales of businesses compared to the prior-year period, which included the gain from the sale of a majority stake in Elite.
- Adjusted EBITDA, which excludes gains on the sale of businesses, as well as other items, increased 4% and the related margin decreased to 38.2% from 39.3% in the prior-year period. The growth in revenues was partly offset by higher costs reflecting continued investments in the business, the impact of acquisitions, and higher incentive compensation. Foreign currency had a 20 basis points positive impact on the year-over-year change in adjusted EBITDA margin.
Diluted EPS decreased to $4.89 compared to $5.80 in the prior-year period as lower income tax expense, which reflected a current year $468 million non-cash tax benefit related to tax legislation enacted in Canada, and currency benefits included in other finance income or costs, were more than offset by a significant prior-year period increase in the value of the company's former investment in LSEG as well as lower operating profit. In 2024, 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 non-cash tax benefit, other finance income or costs, changes in value of the company's former LSEG investment, gains on sales of businesses, as well as other adjustments, increased to $3.77 per share from $3.51 per share in the prior-year period, due to higher adjusted EBITDA. In 2024, adjusted EPS also benefited from a reduction in weighted-average common shares.
Net cash provided by operating activities increased by $116 million due to the cash benefits from higher revenues that more than offset higher investment spending.
- Free cash flow decreased $43 million as higher cash flows from operating activities were more than offset by higher capital expenditures and lower cash flows from other investing activities.
Highlights by Customer Segment – Year Ended December 31
(Millions of U.S. dollars, except for adjusted EBITDA margins) (unaudited)
| |||||||
Year Ended | |||||||
December 31, | Change | ||||||
2024 | 2023 | Total | Constant |
Organic(1)(2) | |||
Revenues | |||||||
Legal Professionals | $2,922 | $2,807 | 4 % | 4 % | 7 % | ||
Corporates | 1,844 | 1,620 | 14 % | 14 % | 10 % | ||
Tax & Accounting Professionals | 1,165 | 1,058 | 10 % | 11 % | 10 % | ||
"Big 3" Segments Combined(1) | 5,931 | 5,485 | 8 % | 8 % | 9 % | ||
Reuters News | 832 | 769 | 8 % | 8 % | 6 % | ||
Global Print | 519 | 562 | -8 % | -7 % | -7 % | ||
Eliminations/Rounding | (24) | (22) | |||||
Revenues | $7,258 | $6,794 | 7 % | 7 % | 7 % | ||
Adjusted EBITDA(1) | |||||||
Legal Professionals | $1,302 | $1,299 | 0 % | 0 % | |||
Corporates | 671 | 619 | 8 % | 8 % | |||
Tax & Accounting Professionals | 527 | 490 | 8 % | 9 % | |||
"Big 3" Segments Combined(1) | 2,500 | 2,408 | 4 % | 4 % | |||
Reuters News | 196 | 172 | 14 % | 16 % | |||
Global Print | 188 | 213 | -12 % | -12 % | |||
Corporate costs | (105) | (115) | n/a | n/a | |||
Adjusted EBITDA | $2,779 | $2,678 | 4 % | 4 % | |||
Adjusted EBITDA Margin(1) | |||||||
Legal Professionals | 44.6 % | 46.2 % | -160bp | -180bp | |||
Corporates | 36.3 % | 38.1 % | -180bp | -220bp | |||
Tax & Accounting Professionals | 45.2 % | 45.8 % | -60bp | -50bp | |||
"Big 3" Segments Combined(1) | 42.1 % | 43.8 % | -170bp | -180bp | |||
Reuters News | 23.6 % | 22.4 % | 120bp | 150bp | |||
Global Print | 36.2 % | 38.0 % | -180bp | -180bp | |||
Adjusted EBITDA margin | 38.2 % | 39.3 % | -110bp | -130bp | |||
(1) See the "Non-IFRS Financial Measures" section and the tables appended to this news release for additional information on these and (2) Computed for revenue growth only. n/a: not applicable | |||||||
2025 Outlook
The company's outlook for 2025 in the table below assumes constant currency rates and incorporates the recent SafeSend acquisition and the divestitures of FindLaw and other non-core businesses 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 2025 organic revenue growth to be in the range of 5% to 6% and its adjusted EBITDA margin to be approximately 40%.
The company's 2025 outlook and updated 2026 financial framework is forward-looking information that is subject to risks and uncertainties (see "Special Note Regarding Forward-Looking Statements, Material Risks and Material Assumptions"). In particular, 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, among other factors, could impact the company's ability to achieve its outlook.
Reported Full-Year 2024 Results and Full-Year 2025 Outlook
Total Thomson Reuters | FY 2024 Reported | FY 2025 Outlook |
Total Revenue Growth | 7 % | 3.0 - 3.5% (2) |
Organic Revenue Growth(1) | 7 % | 7.0 - 7.5 % |
Adjusted EBITDA Margin(1) | 38.2 % | ~39% |
Corporate Costs | $105 million | $120 - $130 million |
Free Cash Flow(1) | $1.8 billion | ~$1.9 billion |
Accrued Capex as % of Revenue(1) | 8.4 % | ~8% |
Depreciation & Amortization of Computer Software Depreciation & Amortization of Internally Developed Software Amortization of Acquired Software | $731 million $584 million $147 million | $835 - $855 million $635 - $655 million ~$200 million |
Interest Expense (P&L) | $125 million | ~$150 million |
Effective Tax Rate on Adjusted Earnings(1) | 17.6 % | ~19% |
"Big 3" Segments(1) | FY 2024 Reported | FY 2025 Outlook |
Total Revenue Growth | 8 % | ~4% (2) |
Organic Revenue Growth | 9 % | ~9% |
Adjusted EBITDA Margin | 42.1 % | ~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) | Total revenue growth reflects the impact of the divestitures of FindLaw and other non-core businesses in December 2024. |
Updated 2026 Financial Framework
For 2026, the company targets an organic revenue growth range of 7.5% - 8.0%, driven by approximately 9.5% growth for the "Big 3" segments. The company targets adjusted EBITDA margin expansion by at least 50 basis points. It anticipates accrued capital expenditures as a percentage of revenues to be approximately 8%, and free cash flow to range from $2.0 - $2.1 billion, and an effective tax rate of approximately 19%.
This financial framework assumes constant currency rates and incorporates the recent SafeSend acquisition 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, future acquisitions and dispositions completed during 2025 and 2026, and macroeconomic events outside of the company's control may differ materially from the company's 2025 outlook and 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 2025 outlook and 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 Acquisition
In January 2025, the company acquired cPaperless, LLC, doing business as SafeSend, for $600 million in cash. SafeSend is a U.S. based cloud-native provider of technology for tax and accounting professionals. SafeSend automates the "last-mile" of the tax return, including assembly, review, taxpayer e-signature, and delivery. This business will be substantially reported in the Tax & Accounting Professionals segment.
Dividends and common shares outstanding
The company announced today that its Board of Directors approved a 10% or $0.22 per share annualized increase in the dividend to $2.38 per common share, representing the 32nd consecutive year of dividend increases and the fourth consecutive 10% increase. A quarterly dividend of $0.595 per share is payable on March 10, 2025 to common shareholders of record as of February 20, 2025.
As of February 4, 2025, Thomson Reuters had approximately 450.1 million common shares outstanding.
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, net debt and leverage ratio of net debt to adjusted EBITDA, 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.
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 and financial framework. 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 and financial framework contain various non-IFRS financial measures. The company believes that providing reconciliations of forward-looking non-IFRS financial measures in its outlook and financial framework 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 purposes of its outlook and financial framework 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. Additionally, the company cannot reasonably predict 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 "2025 Outlook" section, the "Updated 2026 Financial Framework" section and the company's expectations including the impact of its recent acquisition of SafeSend, 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 19-35 in the "Risk Factors" section of the company's 2023 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 2025 outlook and updated 2026 financial framework are 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 and financial framework. 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 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 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 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 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 and financial framework. Material assumptions related to the company's effective tax rate on adjusted earnings outlook and financial framework are its ability to achieve its adjusted EBITDA target; the mix of taxing jurisdictions where the company recognized pre-tax profit or losses in 2024 does not significantly change; no unexpected changes in tax laws or treaties within the jurisdictions where the company operates; 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 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 artificial intelligence (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 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 and financial framework are the same as the risks above related to the revenue and adjusted EBITDA margin targets; 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 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 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 | 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 2024 results and its 2025 business outlook and updated 2026 financial framework today beginning at 8:00 a.m. Eastern Standard Time (EST). 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, | ||||
2024 | 2023 | 2024 | 2023 | ||
CONTINUING OPERATIONS | |||||
Revenues | $1,909 | $1,815 | $7,258 | $6,794 | |
Operating expenses | (1,183) | (1,112) | (4,471) | (4,134) | |
Depreciation | (26) | (29) | (113) | (116) | |
Amortization of computer software | (160) | (135) | (618) | (512) | |
Amortization of other identifiable intangible assets | (22) | (25) | (91) | (97) | |
Other operating gains, net | 204 | 44 | 144 | 397 | |
Operating profit | 722 | 558 | 2,109 | 2,332 | |
Finance costs, net: | |||||
Net interest expense | (28) | (31) | (125) | (152) | |
Other finance income (costs) | 53 | (117) | 45 | (192) | |
Income before tax and equity method investments | 747 | 410 | 2,029 | 1,988 | |
Share of post-tax (losses) earnings in equity method investments | (5) | 260 | 40 | 1,075 | |
Tax (expense) benefit | (135) | (20) | 123 | (417) | |
Earnings from continuing operations | 607 | 650 | 2,192 | 2,646 | |
(Loss) earnings from discontinued operations, net of tax | (20) | 28 | 15 | 49 | |
Net earnings | $587 | $678 | $2,207 | $2,695 | |
Earnings (loss) attributable to: | |||||
Common shareholders | $587 | $678 | $2,210 | $2,695 | |
Non-controlling interests | - | - | (3) | - | |
Earnings per share: | |||||
Basic earnings (loss) per share: | |||||
From continuing operations | $1.35 | $1.43 | $4.86 | $5.70 | |
From discontinued operations | (0.05) | 0.06 | 0.03 | 0.11 | |
Basic earnings per share | $1.30 | $1.49 | $4.89 | $5.81 | |
Diluted earnings (loss) per share: | |||||
From continuing operations | $1.34 | $1.43 | $4.85 | $5.69 | |
From discontinued operations | (0.04) | 0.06 | 0.04 | 0.11 | |
Diluted earnings per share | $1.30 | $1.49 | $4.89 | $5.80 | |
Basic weighted-average common shares | 450,077,127 | 454,510,754 | 450,609,712 | 463,175,043 | |
Diluted weighted-average common shares | 450,600,114 | 455,173,945 | 451,239,490 | 463,970,070 | |
Thomson Reuters Corporation | |||
Consolidated Statement of Financial Position | |||
(millions of U.S. dollars) | |||
(unaudited) | |||
December 31, | December 31, | ||
2024 | 2023 | ||
Assets | |||
Cash and cash equivalents | $1,968 | $1,298 | |
Trade and other receivables | 1,087 | 1,122 | |
Other financial assets | 35 | 66 | |
Prepaid expenses and other current assets | 400 | 435 | |
Current assets | 3,490 | 2,921 | |
Property and equipment, net | 386 | 447 | |
Computer software, net | 1,453 | 1,236 | |
Other identifiable intangible assets, net | 3,134 | 3,165 | |
Goodwill | 7,262 | 6,719 | |
Equity method investments | 269 | 2,030 | |
Other financial assets | 442 | 444 | |
Other non-current assets | 625 | 618 | |
Deferred tax | 1,376 | 1,104 | |
Total assets | $18,437 | $18,684 | |
Liabilities and equity | |||
Liabilities | |||
Current indebtedness | $973 | $372 | |
Payables, accruals and provisions | 1,091 | 1,114 | |
Current tax liabilities | 197 | 248 | |
Deferred revenue | 1,062 | 992 | |
Other financial liabilities | 113 | 507 | |
Current liabilities | 3,436 | 3,233 | |
Long-term indebtedness | 1,847 | 2,905 | |
Provisions and other non-current liabilities | 675 | 692 | |
Other financial liabilities | 232 | 237 | |
Deferred tax | 241 | 553 | |
Total liabilities | 6,431 | 7,620 | |
Equity | |||
Capital | 3,498 | 3,405 | |
Retained earnings | 9,699 | 8,680 | |
Accumulated other comprehensive loss | (1,191) | (1,021) | |
Total equity | 12,006 | 11,064 | |
Total liabilities and equity | $18,437 | $18,684 | |
Thomson Reuters Corporation | |||||
Consolidated Statement of Cash Flow | |||||
(millions of U.S. dollars) | |||||
(unaudited) | |||||
Three Months Ended | Year Ended | ||||
December 31, | December 31, | ||||
2024 | 2023 | 2024 | 2023 | ||
Cash provided by (used in): | |||||
Operating activities | |||||
Earnings from continuing operations | $607 | $650 | $2,192 | $2,646 | |
Adjustments for: | |||||
Depreciation | 26 | 29 | 113 | 116 | |
Amortization of computer software | 160 | 135 | 618 | 512 | |
Amortization of other identifiable intangible assets | 22 | 25 | 91 | 97 | |
Share of post-tax losses (earnings) in equity method investments | 5 | (260) | (40) | (1,075) | |
Net (gains) losses on disposals of businesses and investments | (195) | 5 | (192) | (336) | |
Deferred tax | 47 | (19) | (640) | (388) | |
Other | (22) | 110 | 151 | 298 | |
Changes in working capital and other items | (76) | 40 | 176 | 457 | |
Operating cash flows from continuing operations | 574 | 715 | 2,469 | 2,327 | |
Operating cash flows from discontinued operations | (10) | (10) | (12) | 14 | |
Net cash provided by operating activities | 564 | 705 | 2,457 | 2,341 | |
Investing activities | |||||
Acquisitions, net of cash acquired | (130) | (15) | (622) | (1,216) | |
Proceeds related to disposals of businesses and investments | 297 | - | 326 | 418 | |
Proceeds from sales of LSEG shares | - | 31 | 1,854 | 5,424 | |
Capital expenditures | (161) | (132) | (607) | (544) | |
Other investing activities | 40 | 55 | 46 | 137 | |
Taxes paid on sales of LSEG shares and disposals of businesses | (115) | (162) | (317) | (705) | |
Investing cash flows from continuing operations | (69) | (223) | 680 | 3,514 | |
Investing cash flows from discontinued operations | - | - | - | (1) | |
Net cash (used in) provided by investing activities | (69) | (223) | 680 | 3,513 | |
Financing activities | |||||
Repayments of debt | - | (600) | (290) | (600) | |
Net repayments under short-term loan facilities | - | (513) | (139) | (956) | |
Payments of lease principal | (17) | (14) | (63) | (58) | |
Payments for return of capital on common shares | - | - | - | (2,045) | |
Repurchases of common shares | - | (361) | (639) | (1,079) | |
Dividends paid on preference shares | (1) | (1) | (5) | (5) | |
Dividends paid on common shares | (236) | (215) | (944) | (887) | |
Purchase of non-controlling interests | - | - | (384) | - | |
Other financing activities | 2 | 2 | 5 | 4 | |
Net cash used in financing activities | (252) | (1,702) | (2,459) | (5,626) | |
Translation adjustments | (6) | 2 | (8) | 1 | |
Increase (decrease) in cash and cash equivalents | 237 | (1,218) | 670 | 229 | |
Cash and cash equivalents at beginning of period | 1,731 | 2,516 | 1,298 | 1,069 | |
Cash and cash equivalents at end of period | $1,968 | $1,298 | $1,968 | $1,298 | |
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, | ||||
2024 | 2023 | 2024 | 2023 | ||
Earnings from continuing operations | $607 | $650 | $2,192 | $2,646 | |
Adjustments to remove: | |||||
Tax expense (benefit) | 135 | 20 | (123) | 417 | |
Other finance (income) costs | (53) | 117 | (45) | 192 | |
Net interest expense | 28 | 31 | 125 | 152 | |
Amortization of other identifiable intangible assets | 22 | 25 | 91 | 97 | |
Amortization of computer software | 160 | 135 | 618 | 512 | |
Depreciation | 26 | 29 | 113 | 116 | |
EBITDA | $925 | $1,007 | $2,971 | $4,132 | |
Adjustments to remove: | |||||
Share of post-tax losses (earnings) in equity method investments | 5 | (260) | (40) | (1,075) | |
Other operating gains, net | (204) | (44) | (144) | (397) | |
Fair value adjustments* | (8) | 4 | (8) | 18 | |
Adjusted EBITDA(1) | $718 | $707 | $2,779 | $2,678 | |
Adjusted EBITDA margin(1) | 37.6 % | 38.9 % | 38.2 % | 39.3 % | |
* 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, 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, | ||||
2024 | 2023 | 2024 | 2023 | ||
Net cash provided by operating activities | $564 | $705 | $2,457 | $2,341 | |
Capital expenditures | (161) | (132) | (607) | (544) | |
Other investing activities | 40 | 55 | 46 | 137 | |
Payments of lease principal | (17) | (14) | (63) | (58) | |
Dividends paid on preference shares | (1) | (1) | (5) | (5) | |
Free cash flow(1)) | $425 | $613 | $1,828 | $1,871 | |
Thomson Reuters Corporation | |
Reconciliation of Capital Expenditures to Accrued Capital Expenditures(1) | |
(millions of U.S. dollars) | |
(unaudited) | |
Year Ended | |
December 31, | |
2024 | |
Capital expenditures | $607 |
Remove: IFRS adjustment to cash basis | 2 |
Accrued capital expenditures (1) | $609 |
Accrued capital expenditures as a percentage of revenues(1) | 8.4 % |
(1) Refer to page 23 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 | Year Ended | ||||
December 31, | December 31, | ||||
2024 | 2023 | 2024 | 2023 | ||
Net earnings | $587 | $678 | $2,207 | $2,695 | |
Adjustments to remove: | |||||
Fair value adjustments* | (8) | 4 | (8) | 18 | |
Amortization of acquired computer software | 38 | 24 | 147 | 72 | |
Amortization of other identifiable intangible assets | 22 | 25 | 91 | 97 | |
Other operating gains, net | (204) | (44) | (144) | (397) | |
Interest benefit impacting comparability(2) | - | - | - | (12) | |
Other finance (income) costs | (53) | 117 | (45) | 192 | |
Share of post-tax losses (earnings) in equity method investments | 5 | (260) | (40) | (1,075) | |
Tax on above items(1) | 36 | 38 | (9) | 265 | |
Tax items impacting comparability(1) (2) | 5 | (108) | (478) | (172) | |
Loss (earnings) from discontinued operations, net of tax | 20 | (28) | (15) | (49) | |
Interim period effective tax rate normalization(1) | 7 | 1 | - | - | |
Dividends declared on preference shares | (1) | (1) | (5) | (5) | |
Adjusted earnings(1) (3) | $454 | $446 | $1,701 | $1,629 | |
Adjusted EPS(1) (3) | $1.01 | $0.98 | $3.77 | $3.51 | |
Total change | 3 % | 7 % | |||
Foreign currency | 2 % | 1 % | |||
Constant currency | 1 % | 7 % | |||
Diluted weighted-average common shares (millions) | 450.6 | 455.2 | 451.2 | 464.0 | |
Reconciliation of Effective Tax Rate on Adjusted Earnings(1) | Year-ended |
December 31, | |
2024 | |
Adjusted earnings | $1,701 |
Plus: Dividends declared on preference shares | 5 |
Plus: Tax expense on adjusted earnings | 364 |
Pre-tax adjusted earnings | $2,070 |
IFRS Tax benefit | $(123) |
Remove tax related to: | |
Amortization of acquired computer software | 33 |
Amortization of other identifiable intangible assets | 22 |
Share of post-tax earnings in equity method investments | (7) |
Other finance income | 19 |
Other operating gains, net | (56) |
Other items | (2) |
Subtotal – Remove tax benefit on pre-tax items removed from adjusted earnings | 9 |
Remove: Tax items impacting comparability | 478 |
Total - Remove all items impacting comparability | 487 |
Tax expense on adjusted earnings | $364 |
Effective tax rate on adjusted earnings | 17.6 % |
*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, which are a component of operating expenses, as well as adjustments related to acquired deferred revenue. |
(1) | Refer to page 23 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. |
(3) | The adjusted earnings impact of non-controlling interests, which was applicable only to the year ended December 31, 2024, was not material. |
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 | ||||||||
2024 | 2023 | Total |
Foreign | SUBTOTAL | Net Acquisitions/ |
Organic | |||
Total Revenues | |||||||||
Legal Professionals | $729 | $700 | 4 % | 0 % | 4 % | -4 % | 7 % | ||
Corporates | 458 | 402 | 14 % | -1 % | 15 % | 5 % | 10 % | ||
Tax & Accounting Professionals | 366 | 344 | 6 % | 0 % | 7 % | 0 % | 7 % | ||
"Big 3" Segments Combined (1) | 1,553 | 1,446 | 7 % | 0 % | 7 % | -1 % | 8 % | ||
Reuters News | 218 | 220 | -1 % | 0 % | -1 % | 1 % | -3 % | ||
Global Print | 144 | 154 | -6 % | 0 % | -6 % | 0 % | -6 % | ||
Eliminations/Rounding | (6) | (5) | |||||||
Revenues | $1,909 | $1,815 | 5 % | 0 % | 5 % | 0 % | 5 % | ||
Recurring Revenues | |||||||||
Legal Professionals | $707 | $674 | 5 % | 0 % | 4 % | -4 % | 8 % | ||
Corporates | 401 | 358 | 12 % | 0 % | 13 % | 3 % | 10 % | ||
Tax & Accounting Professionals | 319 | 305 | 4 % | -1 % | 5 % | 0 % | 5 % | ||
"Big 3" Segments Combined (1) | 1,427 | 1,337 | 7 % | 0 % | 7 % | -1 % | 8 % | ||
Reuters News | 173 | 157 | 10 % | 0 % | 10 % | 2 % | 8 % | ||
Eliminations/Rounding | (6) | (5) | |||||||
Total Recurring Revenues | $1,594 | $1,489 | 7 % | 0 % | 7 % | -1 % | 8 % | ||
Transactions Revenues | |||||||||
Legal Professionals | $22 | $26 | -11 % | -1 % | -10 % | -5 % | -4 % | ||
Corporates | 57 | 44 | 25 % | -3 % | 28 % | 17 % | 12 % | ||
Tax & Accounting Professionals | 47 | 39 | 22 % | 1 % | 21 % | 0 % | 21 % | ||
"Big 3" Segments Combined (1) | 126 | 109 | 16 % | -1 % | 17 % | 5 % | 11 % | ||
Reuters News | 45 | 63 | -29 % | 1 % | -29 % | 1 % | -30 % | ||
Total Transactions Revenues | $171 | $172 | -1 % | -1 % | 0 % | 3 % | -4 % | ||
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 23 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 | ||||||||
2024 | 2023 | Total |
Foreign | SUBTOTAL | Net Acquisitions/ |
Organic | |||
Total Revenues | |||||||||
Legal Professionals | $2,922 | $2,807 | 4 % | 0 % | 4 % | -3 % | 7 % | ||
Corporates | 1,844 | 1,620 | 14 % | 0 % | 14 % | 4 % | 10 % | ||
Tax & Accounting Professionals | 1,165 | 1,058 | 10 % | -1 % | 11 % | 1 % | 10 % | ||
"Big 3" Segments Combined (1) | 5,931 | 5,485 | 8 % | 0 % | 8 % | 0 % | 9 % | ||
Reuters News | 832 | 769 | 8 % | 0 % | 8 % | 2 % | 6 % | ||
Global Print | 519 | 562 | -8 % | 0 % | -7 % | 0 % | -7 % | ||
Eliminations/Rounding | (24) | (22) | |||||||
Revenues | $7,258 | $6,794 | 7 % | 0 % | 7 % | 0 % | 7 % | ||
Recurring Revenues | |||||||||
Legal Professionals | $2,828 | $2,674 | 6 % | 0 % | 6 % | -2 % | 8 % | ||
Corporates | 1,543 | 1,373 | 12 % | 0 % | 13 % | 3 % | 10 % | ||
Tax & Accounting Professionals | 867 | 808 | 7 % | -2 % | 9 % | 0 % | 9 % | ||
"Big 3" Segments Combined (1) | 5,238 | 4,855 | 8 % | 0 % | 8 % | 0 % | 9 % | ||
Reuters News | 668 | 625 | 7 % | -1 % | 7 % | 2 % | 5 % | ||
Eliminations/Rounding | (24) | (22) | |||||||
Total Recurring Revenues | $5,882 | $5,458 | 8 % | 0 % | 8 % | 0 % | 8 % | ||
Transactions Revenues | |||||||||
Legal Professionals | $94 | $133 | -29 % | -2 % | -28 % | -25 % | -2 % | ||
Corporates | 301 | 247 | 22 % | -1 % | 22 % | 11 % | 11 % | ||
Tax & Accounting Professionals | 298 | 250 | 19 % | 0 % | 19 % | 5 % | 14 % | ||
"Big 3" Segments Combined (1) | 693 | 630 | 10 % | -1 % | 11 % | 0 % | 10 % | ||
Reuters News | 164 | 144 | 14 % | 1 % | 13 % | 4 % | 9 % | ||
Total Transactions Revenues | $857 | $774 | 11 % | -1 % | 11 % | 1 % | 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 23 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 | ||||||
2024 | 2023 | Total | Foreign Currency | Constant Currency | |||
Adjusted EBITDA (1) | |||||||
Legal Professionals | $299 | $298 | 0 % | 2 % | -1 % | ||
Corporates | 153 | 138 | 11 % | 2 % | 8 % | ||
Tax & Accounting Professionals | 196 | 188 | 4 % | -1 % | 5 % | ||
"Big 3" Segments Combined (1) | 648 | 624 | 4 % | 1 % | 3 % | ||
Reuters News | 45 | 61 | -26 % | -1 % | -26 % | ||
Global Print | 55 | 55 | -1 % | 0 % | -1 % | ||
Corporate costs | (30) | (33) | n/a | n/a | n/a | ||
Adjusted EBITDA | $718 | $707 | 2 % | 1 % | 1 % | ||
Adjusted EBITDA Margin (1) | |||||||
Legal Professionals | 41.0 % | 42.5 % | -150bp | 50bp | -200bp | ||
Corporates | 33.5 % | 34.5 % | -100bp | 90bp | -190bp | ||
Tax & Accounting Professionals | 53.4 % | 54.6 % | -120bp | -30bp | -90bp | ||
"Big 3" Segments Combined (1) | 41.7 % | 43.1 % | -140bp | 50bp | -190bp | ||
Reuters News | 20.8 % | 27.9 % | -710bp | -40bp | -670bp | ||
Global Print | 38.2 % | 36.4 % | 180bp | -10bp | 190bp | ||
Adjusted EBITDA margin | 37.6 % | 38.9 % | -130bp | 30bp | -160bp | ||
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 | ||||||
2024 | 2023 | Total | Foreign Currency | Constant Currency | |||
Adjusted EBITDA (1) | |||||||
Legal Professionals | $1,302 | $1,299 | 0 % | 0 % | 0 % | ||
Corporates | 671 | 619 | 8 % | 1 % | 8 % | ||
Tax & Accounting Professionals | 527 | 490 | 8 % | -1 % | 9 % | ||
"Big 3" Segments Combined (1) | 2,500 | 2,408 | 4 % | 0 % | 4 % | ||
Reuters News | 196 | 172 | 14 % | -2 % | 16 % | ||
Global Print | 188 | 213 | -12 % | 0 % | -12 % | ||
Corporate costs | (105) | (115) | n/a | n/a | n/a | ||
Adjusted EBITDA | $2,779 | $2,678 | 4 % | 0 % | 4 % | ||
Adjusted EBITDA Margin (1) | |||||||
Legal Professionals | 44.6 % | 46.2 % | -160bp | 20bp | -180bp | ||
Corporates | 36.3 % | 38.1 % | -180bp | 40bp | -220bp | ||
Tax & Accounting Professionals | 45.2 % | 45.8 % | -60bp | -10bp | -50bp | ||
"Big 3" Segments Combined (1) | 42.1 % | 43.8 % | -170bp | 10bp | -180bp | ||
Reuters News | 23.6 % | 22.4 % | 120bp | -30bp | 150bp | ||
Global Print | 36.2 % | 38.0 % | -180bp | 0bp | -180bp | ||
Adjusted EBITDA margin | 38.2 % | 39.3 % | -110bp | 20bp | -130bp | ||
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 23 for additional information on non-IFRS financial measures. |
Reconciliation of adjusted EBITDA margin (1)
To compute segment and consolidated adjusted EBITDA margin, the company excludes fair value adjustments related to acquired deferred revenue from its IFRS revenues. The charts below reconcile 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, 2024 | ||||||
IFRS revenues | Remove fair value | Revenues excluding | Adjusted EBITDA | Adjusted EBITDA | ||
Legal Professionals | $729 | - | $729 | $299 | 41.0 % | |
Corporates | 458 | $1 | 459 | 153 | 33.5 % | |
Tax & Accounting Professionals | 366 | - | 366 | 196 | 53.4 % | |
"Big 3" Segments Combined | 1,553 | 1 | 1,554 | 648 | 41.7 % | |
Reuters News | 218 | - | 218 | 45 | 20.8 % | |
Global Print | 144 | - | 144 | 55 | 38.2 % | |
Eliminations/ Rounding | (6) | - | (6) | - | n/a | |
Corporate costs | - | - | - | (30) | n/a | |
Consolidated totals | $1,909 | $1 | $1,910 | $718 | 37.6 % | |
Year ended December 31, 2024 | ||||||
IFRS revenues | Remove fair value | Revenues excluding | Adjusted EBITDA | Adjusted EBITDA | ||
Legal Professionals | $2,922 | $1 | $2,923 | $1,302 | 44.6 % | |
Corporates | 1,844 | 6 | 1,850 | 671 | 36.3 % | |
Tax & Accounting Professionals | 1,165 | - | 1,165 | 527 | 45.2 % | |
"Big 3" Segments Combined | 5,931 | 7 | 5,938 | 2,500 | 42.1 % | |
Reuters News | 832 | 2 | 834 | 196 | 23.6 % | |
Global Print | 519 | - | 519 | 188 | 36.2 % | |
Eliminations/ Rounding | (24) | - | (24) | - | n/a | |
Corporate costs | - | - | - | (105) | n/a | |
Consolidated totals | $7,258 | $9 | $7,267 | $2,779 | 38.2 % | |
Three months ended December 31, 2023 | ||||||
IFRS revenues | Remove fair value | Revenues excluding | Adjusted EBITDA | Adjusted EBITDA | ||
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 % | |
n/a: not applicable |
Margins are computed using whole dollars, as a result, margins calculated from reported amounts may differ from those presented due to rounding. |
(1) | Refer to page 23 for additional information on non-IFRS financial measures. |
Reconciliation of adjusted EBITDA margin(1)
Year ended December 31, 2023 | ||||||
IFRS revenues | Remove fair value | Revenues excluding | Adjusted EBITDA | Adjusted EBITDA | ||
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 % | |
n/a: not applicable |
Margins are computed using whole dollars, as a result, margins calculated from reported amounts may differ from those presented due to rounding. |
Thomson Reuters Corporation | |||
Reconciliation of Net Debt(1) and Leverage Ratio of Net Debt to Adjusted EBITDA(1) | |||
(millions of U.S. dollars) | |||
(unaudited) | |||
December 31, | December 31, | ||
2024 | 2023 | ||
Current indebtedness | $973 | $372 | |
Long-term indebtedness | 1,847 | 2,905 | |
Total debt | 2,820 | 3,277 | |
Swaps | 21 | (65) | |
Total debt after swaps | 2,841 | 3,212 | |
Remove fair value adjustments for hedges | 5 | 2 | |
Total debt after currency hedging arrangements | 2,846 | 3,214 | |
Remove transaction costs, premiums or discounts included in the carrying value of debt | 22 | 26 | |
Add: Lease liabilities (current and non-current) | 256 | 265 | |
Less: Cash and cash equivalents | (1,968) | (1,298) | |
Net debt | $1,156 | $2,207 | |
Leverage ratio of net debt to adjusted EBITDA | |||
Adjusted EBITDA | $2,779 | $2,678 | |
Net debt/adjusted EBITDA | 0.4:1 | 0.8:1 | |
(1) | Refer to page 23 for additional information on non-IFRS financial measures. |
Non-IIFRS Financial | 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 computer 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 the company's 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.
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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, the company also makes 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.
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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, 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.
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"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. |
Net debt and leverage ratio of net debt to adjusted EBITDA | Net debt is total indebtedness (excluding the associated unamortized transaction costs and premiums or discount) plus the currency related fair value of associated hedging instruments, and lease liabilities less cash and cash equivalents.
Net debt to adjusted EBITDA is net debt divided by adjusted EBITDA for the previous twelve-month period ending with the current fiscal quarter.
| Provides a commonly used measure of a company's leverage and its ability to pay its debt. Given that the company hedges some of its debt to reduce risk, the company includes hedging instruments as it believes it provides a better measure of the total obligation associated with its outstanding debt. However, because the company intends to hold its debt and related hedges to maturity, the company does not consider the interest components of the associated fair value of hedges in its measurements. The company reduces gross indebtedness by cash and cash equivalents.
The company's non-IFRS measure is aligned with the calculation of its internal target and is more conservative than the maximum ratio allowed under the contractual covenants in its credit facility. |
Please refer to reconciliations for the most directly comparable IFRS financial measures. |
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SOURCE Thomson Reuters