TORONTO, Feb. 9, 2023
/PRNewswire/ -- Thomson Reuters (TSX/NYSE: TRI) today reported
results for the fourth quarter and full year ended December 31,
2022:
- Broad revenue momentum continued for the fourth quarter and
full year
-
- Full-year total company revenue up 4% / organic revenue up
6%
- Fourth-quarter total company revenue up 3% / organic revenue up
6%
-
- Organic revenue up 7% for the "Big 3" segments (Legal
Professionals, Corporates, and Tax & Accounting
Professionals)
- Based on 2022 performance, maintained full-year 2023 organic
revenue and adjusted EBITDA margin outlooks; select other 2023
metrics updated
- Completed Change Program, achieving $540
million run-rate operating expense savings by the end of
2022
- Increased annualized dividend per share by 10% (30th
consecutive annual increase)
- On track to conclude current $2
billion share buyback program by April
- Intend to execute return of capital of at least $2 billion with concurrent share consolidation in
2023 funded by London Stock Exchange Group (LSEG) proceeds
- Closed acquisition of SurePrep on January 3
"2022 was a year of significant progress at Thomson Reuters,"
said Steve Hasker, President and CEO
of Thomson Reuters. "Our product and innovation efforts were
highlighted by the September launch of Westlaw Precision, which
continues to see strong momentum. We also successfully completed
our Change Program at year end, delivering to our financial results
and driving significant progress across our company. The completion
of the Change Program provides us with a strong foundation for
sustainable growth into the future."
Mr. Hasker added, "Looking ahead, we remain focused on
allocating capital to drive sustainable long-term value creation.
The acquisition of SurePrep brings leading AI-driven workflow
automation capabilities and represents another strong platform for
growth while helping our customers save time and costs.
Importantly, we are on pace to complete our $2 billion share repurchase program by April, and
we plan to execute a return of capital of at least $2 billion later this year, funded with LSEG sale
proceeds."
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)
|
2022
|
2021
|
Change
|
Change at
Constant
Currency
|
Revenues
|
$1,765
|
$1,710
|
3 %
|
|
Operating
profit
|
$631
|
$257
|
146 %
|
|
Diluted earnings (loss)
per share (EPS)
|
$0.59
|
$(0.36)
|
n/m
|
|
Net cash provided by
operating activities
|
$676
|
$397
|
70 %
|
|
Non-IFRS Financial
Measures(1)
|
|
|
|
|
Revenues
|
$1,765
|
$1,710
|
3 %
|
5 %
|
Adjusted
EBITDA
|
$633
|
$452
|
40 %
|
41 %
|
Adjusted EBITDA
margin
|
35.9 %
|
26.4 %
|
950bp
|
920bp
|
Adjusted EPS
|
$0.73
|
$0.43
|
70 %
|
72 %
|
Free cash
flow
|
$526
|
$255
|
106 %
|
|
(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.
n/m: not
meaningful
|
Revenues increased 3%, driven by growth across four of
the company's five business segments. Foreign currency and
divestitures had a 2% and a 1% negative impact on revenues,
respectively.
- Organic revenues increased 6%, driven by 7% growth in recurring
revenues (82% of total revenues), as well as 5% growth in
transactions revenues. Global Print revenues decreased 1%
organically.
- The company's "Big 3" segments reported organic revenue growth
of 7% and collectively comprised 80% of total revenues.
Operating profit increased significantly due to lower
costs, which included cost benefits resulting from the Change
Program and lower performance bonus expense, as well as higher
revenues and gains on the sale of certain non-core businesses.
- Adjusted EBITDA, which excludes gains on the sale of
certain non-core businesses, as well as other adjustments,
increased 40% due to lower costs and higher revenues. The related
margin increased to 35.9% from 26.4% in the prior-year period, of
which foreign currency contributed 30bp. Investments in the Change
Program negatively impacted the fourth quarter of 2022 adjusted
EBITDA margin by 340bp.
Diluted EPS was $0.59
compared to diluted loss per share of $(0.36) in the prior-year period due to higher
operating profit and because the prior-year period included a
decrease in value in the company's investment in LSEG.
- Adjusted EPS, which excludes the change in value of the
company's LSEG investment, as well as other adjustments, increased
to $0.73 per share from $0.43 per share in the prior-year period as
higher adjusted EBITDA more than offset higher income tax
expense.
Net cash provided by operating activities increased
$279 million, reflecting the cash
benefits from higher operating profit as well as favorable
movements in working capital.
- Free cash flow increased $271
million due to higher cash flows from operating
activities.
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
|
|
|
2022
|
2021(2)
|
|
Total
|
Constant
Currency(1)
|
Organic(1)(3)
|
Revenues
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$704
|
$689
|
|
2 %
|
4 %
|
5 %
|
Corporates
|
|
379
|
358
|
|
6 %
|
7 %
|
9 %
|
Tax &
Accounting Professionals
|
|
326
|
312
|
|
5 %
|
5 %
|
8 %
|
"Big 3" Segments
Combined(1)
|
|
1,409
|
1,359
|
|
4 %
|
5 %
|
7 %
|
Reuters
News
|
|
198
|
187
|
|
7 %
|
10 %
|
10 %
|
Global
Print
|
|
162
|
170
|
|
-4 %
|
-2 %
|
-1 %
|
Eliminations/Rounding
|
|
(4)
|
(6)
|
|
|
|
|
Revenues
|
|
$1,765
|
$1,710
|
|
3 %
|
5 %
|
6 %
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$294
|
$239
|
|
23 %
|
27 %
|
|
Corporates
|
|
135
|
93
|
|
45 %
|
46 %
|
|
Tax &
Accounting Professionals
|
|
189
|
156
|
|
22 %
|
21 %
|
|
"Big 3" Segments
Combined(1)
|
|
618
|
488
|
|
27 %
|
28 %
|
|
Reuters
News
|
|
40
|
15
|
|
162 %
|
125 %
|
|
Global
Print
|
|
59
|
61
|
|
-3 %
|
-1 %
|
|
Corporate
costs
|
|
(84)
|
(112)
|
|
n/a
|
n/a
|
|
Adjusted
EBITDA
|
|
$633
|
$452
|
|
40 %
|
41 %
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
41.7 %
|
34.5 %
|
|
720bp
|
740bp
|
|
Corporates
|
|
35.7 %
|
26.0 %
|
|
970bp
|
940bp
|
|
Tax &
Accounting Professionals
|
|
58.1 %
|
50.0 %
|
|
810bp
|
740bp
|
|
"Big 3" Segments
Combined(1)
|
|
43.9 %
|
35.8 %
|
|
810bp
|
780bp
|
|
Reuters
News
|
|
19.8 %
|
8.1 %
|
|
1170bp
|
840bp
|
|
Global
Print
|
|
36.1 %
|
35.9 %
|
|
20bp
|
20bp
|
|
Adjusted EBITDA
margin
|
|
35.9 %
|
26.4 %
|
|
950bp
|
920bp
|
|
|
|
|
|
|
|
|
|
(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.
(2) For
comparative purposes, 2021 segment results have been revised to
reflect the current period presentation. For additional
information, see the "Revision to
Prior-Year Segment Results" section of this news
release.
(3)
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 increased 4% (5% organic) to $704 million.
- Recurring revenues grew 5% (94% of total, 6% organic) primarily
driven by Westlaw, Practical Law and HighQ.
- Transactions revenues decreased 11% (6% of total, decreased 8%
organic), primarily related to lower professional services revenues
in the ELITE business and slower release of US Federal funding,
which affected revenues in the Government business.
Adjusted EBITDA increased 23% to $294 million.
- The margin increased to 41.7% from 34.5%, driven by higher
revenues, Change Program savings and lower performance bonus
expense.
Corporates
Revenues increased 7% (9% organic) to $379 million.
- Recurring revenues grew 10% (89% of total, 11% organic)
primarily driven by Practical Law, CLEAR, Direct Tax and Global
Trade Management.
- Transactions revenues decreased 8% (11% of total, decreased 5%
organic), primarily related to weaker implementation revenues.
Adjusted EBITDA increased 45% to $135 million.
- The margin increased to 35.7% from 26.0%, driven by higher
revenues, Change Program savings and lower performance bonus
expense.
Tax & Accounting Professionals
Revenues increased 5% (8% organic) to $326 million.
- Recurring revenues grew 5% (90% of total, 8% organic) primarily
driven by UltraTax and the segment's Latin America business.
- Transactions revenues increased 6% (10% of total, 10% organic),
primarily driven by UltraTax, Confirmation and the segment's
Latin America business.
Adjusted EBITDA increased 22% to $189 million.
- The margin increased to 58.1% from 50.0%, driven by higher
revenues, Change Program savings and lower performance bonus
expense.
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 $198 million
increased 10% (all organic), primarily driven by the Reuters Events
business and the company's news agreement with the Data &
Analytics business of LSEG.
Adjusted EBITDA increased 162% to $40 million, driven by Reuters Events revenue
growth and currency benefits.
Global Print
Revenues decreased 2% (decreased 1% organic) to
$162 million, which was better than
expected driven by improved retention, better third-party print
revenue and timing benefits, which are expected to normalize in the
first quarter of 2023.
Adjusted EBITDA decreased 3% to $59 million.
- The margin increased to 36.1% from 35.9%.
Corporate Costs
Corporate costs at the adjusted EBITDA level were
$84 million and included $60 million of Change Program costs. Corporate
costs were $112 million in the
prior-year period and included $78
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)
|
2022
|
2021
|
Change
|
Change at
Constant
Currency
|
Revenues
|
$6,627
|
$6,348
|
4 %
|
|
Operating
profit
|
$1,834
|
$1,242
|
48 %
|
|
Diluted EPS
|
$2.88
|
$11.50
|
-75 %
|
|
Net cash provided by
operating activities
|
$1,915
|
$1,773
|
8 %
|
|
Non-IFRS Financial
Measures(1)
|
|
|
|
|
Revenues
|
$6,627
|
$6,348
|
4 %
|
6 %
|
Adjusted
EBITDA
|
$2,329
|
$1,970
|
18 %
|
18 %
|
Adjusted EBITDA
margin
|
35.1 %
|
31.0 %
|
410bp
|
350bp
|
Adjusted EPS
|
$2.56
|
$1.95
|
31 %
|
30 %
|
Free cash
flow
|
$1,340
|
$1,256
|
7 %
|
|
(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.
|
Revenues increased 4%, driven by growth across four of
the company's five business segments. Foreign currency had a 2%
negative impact on revenues.
- Organic revenues increased 6%, driven by 7% growth in recurring
revenues (80% of total revenues) as well as 6% growth in
transactions revenues. Global Print revenues decreased 1%
organically.
- The company's "Big 3" segments reported organic revenue growth
of 7% and collectively comprised 80% of total revenues.
Operating profit increased 48% due to higher revenues,
lower costs, which included cost benefits resulting from the Change
Program as well as currency benefits, and gains on the sale of
certain non-core businesses.
- Adjusted EBITDA, which excludes gains on the sale of
non-core businesses, as well as other adjustments, increased 18%
due to lower costs and higher revenues. The related margin
increased to 35.1% from 31.0% in the prior-year period, of which
foreign currency contributed 60bp. Investments in the Change
Program negatively impacted the full year of 2022 adjusted EBITDA
margin by 260bp.
Diluted EPS was $2.88
per share compared to $11.50 per
share in the prior-year period. The prior-year period included a
gain of approximately $8.1 billion on
the sale of Refinitiv to LSEG.
- Adjusted EPS, which excludes the gain on the sale of
Refinitiv, as well as other adjustments, increased to $2.56 per share from $1.95 per share in the prior-year period, as
higher adjusted EBITDA more than offset higher income tax
expense.
Net cash provided by operating activities increased
$142 million as the cash benefits
from higher operating profit more than offset higher payments
associated with the Change Program and higher annual incentive plan
bonuses.
- Free cash flow increased $84
million as higher cash flows from operating activities were
partially offset by higher capital expenditures primarily
associated with 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
|
|
|
2022
|
2021(2)
|
|
Total
|
Constant
Currency(1)
|
Organic(1)(3)
|
Revenues
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$2,803
|
$2,712
|
|
3 %
|
5 %
|
6 %
|
Corporates
|
|
1,536
|
1,440
|
|
7 %
|
8 %
|
8 %
|
Tax &
Accounting Professionals
|
|
986
|
915
|
|
8 %
|
8 %
|
9 %
|
"Big 3" Segments
Combined(1)
|
|
5,325
|
5,067
|
|
5 %
|
6 %
|
7 %
|
Reuters
News
|
|
733
|
694
|
|
6 %
|
9 %
|
9 %
|
Global
Print
|
|
592
|
609
|
|
-3 %
|
-1 %
|
-1 %
|
Eliminations/Rounding
|
|
(23)
|
(22)
|
|
|
|
|
Revenues
|
|
$6,627
|
$6,348
|
|
4 %
|
6 %
|
6 %
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$1,227
|
$1,091
|
|
13 %
|
14 %
|
|
Corporates
|
|
578
|
496
|
|
17 %
|
16 %
|
|
Tax &
Accounting Professionals
|
|
451
|
379
|
|
19 %
|
18 %
|
|
"Big 3" Segments
Combined(1)
|
|
2,256
|
1,966
|
|
15 %
|
16 %
|
|
Reuters
News
|
|
154
|
103
|
|
50 %
|
36 %
|
|
Global
Print
|
|
212
|
226
|
|
-6 %
|
-4 %
|
|
Corporate
costs
|
|
(293)
|
(325)
|
|
n/a
|
n/a
|
|
Adjusted
EBITDA
|
|
$2,329
|
$1,970
|
|
18 %
|
18 %
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
43.8 %
|
40.2 %
|
|
360bp
|
350bp
|
|
Corporates
|
|
37.6 %
|
34.4 %
|
|
320bp
|
270bp
|
|
Tax &
Accounting Professionals
|
|
45.8 %
|
41.3 %
|
|
450bp
|
390bp
|
|
"Big 3" Segments
Combined(1)
|
|
42.4 %
|
38.8 %
|
|
360bp
|
330bp
|
|
Reuters
News
|
|
21.0 %
|
14.8 %
|
|
620bp
|
380bp
|
|
Global
Print
|
|
35.7 %
|
37.1 %
|
|
-140bp
|
-130bp
|
|
Adjusted EBITDA
margin
|
|
35.1 %
|
31.0 %
|
|
410bp
|
350bp
|
|
|
|
|
|
|
|
|
|
(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.
(2) For
comparative purposes, 2021 segment results have been revised to
reflect the current period presentation. For additional
information, see the "Revision to Prior-Year
Segment Results" section of this news release.
(3)
Computed for revenue growth only.
n/a: not
applicable
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change Program
In February 2021, the company
announced a two-year Change Program to transition from a holding
company to an operating company, and from a content provider to a
content-driven technology company. The program was concluded in
December 2022.
During the two-year period, the company invested nearly
$600 million and has broadly
delivered against the financial targets set out in 2021, with
$540 million of run-rate savings
achieved as of December 31, 2022.
During the program, the company made significant progress in
transforming itself into a more streamlined and scalable business
and now has a strong foundation for sustainable future growth.
2023 Outlook
The company is maintaining its 2023 outlook for organic revenue
growth and adjusted EBITDA margin but has updated select other
performance measures. The company's updated outlook for 2023 in the
table below assumes constant currency rates and incorporates the
recent SurePrep acquisition and fourth-quarter 2022 divestitures
but excludes the impact of any future acquisitions or dispositions
that may occur during 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 2023 organic revenue
growth rate to be at the low end of the full year 5.5% - 6.0%
range, and its adjusted EBITDA margin to be approximately 38%.
While the company's full-year 2022 performance provides it with
increasing confidence about its updated 2023 outlook, there are
many signs that point to a weakening global economic environment,
amid rising interest rates, high inflation, and ongoing
geopolitical risks. Any worsening of the global economic or
business environment could impact the company's ability to achieve
its outlook.
Reported Full-Year 2022 and Updated Full-Year 2023
Outlook
Total Thomson
Reuters
|
FY
2022
Reported
|
FY
2023
Outlook
11/1/22
|
FY
2023
Outlook
2/9/23
|
Total Revenue
Growth
|
4 %
|
5.5% - 6.0%
|
4.5% - 5.0%
|
Organic Revenue
Growth(1)
|
6 %
|
5.5% - 6.0%
|
5.5% - 6.0%
|
Adjusted EBITDA
Margin(1)
|
35.1 %
|
39% - 40%
|
~ 39%
|
Corporate
Costs
Core Corporate Costs
Change Program
Opex
|
$293 million
$122 million
$171 million
|
$110 - $120
million
$110 - $120
million
n/a
|
$110 - $120
million
$110 - $120
million
n/a
|
Free Cash
Flow(1)
|
$1.3 billion
|
$1.9 - $2.0
Billion
|
~$1.8
billion
|
Accrued Capex as % of
Revenue(1)
Real Estate Optimization
Spend(2)
|
8.2%
n/a
|
6.0% - 6.5%
n/a
|
~ 7%
$30 million
|
Depreciation &
Amortization of Computer Software
|
$625 million
|
$580 - $605
million
|
$595 - $625
million
|
Interest Expense
(P&L)
|
$196 million
|
$190 - $210
million
|
$190 - $210
million
|
Effective Tax Rate on
Adjusted Earnings(1)
|
17.6 %
|
n/a
|
~ 18%
|
"Big 3"
Segments(1)
|
FY
2022
Reported
|
FY
2023
Outlook
11/1/22
|
FY
2023
Outlook
2/9/23
|
Total Revenue Growth
|
5 %
|
6.5% - 7.0%
|
5.5% - 6.0%
|
Organic Revenue
Growth
|
7 %
|
6.5% - 7.0%
|
6.5% - 7.0%
|
Adjusted EBITDA
Margin
|
42.4 %
|
44% - 45%
|
~ 44%
|
|
|
(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)
|
Real estate
optimization spend in 2023 is incremental to the Accrued Capex as a
percent of revenue outlook.
|
The information in this section is forward-looking. Actual
results, which will include the impact of currency and future
acquisitions and dispositions completed during 2023, may differ
materially from the company's outlook. 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."
Dividends
The company announced today that its Board of Directors approved
a 10% or $0.18 per share annualized
increase in the dividend to $1.96 per
common share, representing the 30th consecutive
year of dividend increases. A quarterly dividend of $0.49 per share is payable on March 16, 2023 to common shareholders of record
as of February 23, 2023.
Share Repurchases – Update on $2.0
Billion Buyback Program
In June 2022, Thomson Reuters
announced its plans to repurchase up to $2.0
billion of its common shares.
From June 2022 through
January 31, 2023, the company
repurchased approximately 13.9 million of its common shares under
this buyback program, for a total spend of $1.5 billion. As of January 31, 2023, Thomson Reuters had
approximately 474.1 million common shares outstanding.
Subject to market conditions, the company anticipates completing
the $2.0 billion program by early
second-quarter 2023.
Intention to Execute Return of Capital of at least
$2 Billion
Following the completion of the share repurchase program, the
company intends in 2023 to initiate a return of capital of at least
$2 billion, which will be combined
with a share consolidation or reverse stock split (similar to the
return of capital transaction that the company completed in 2018).
This transaction will be funded through proceeds from LSEG share
dispositions, and as such, the timing and amount of the transaction
will depend on market conditions and other factors.
LSEG Ownership Interest
In January 2021, Thomson Reuters
and private equity funds affiliated with Blackstone sold Refinitiv
to LSEG in an all-share transaction. Thomson Reuters indirectly
owns LSEG shares through an entity that it jointly owns with
Blackstone's consortium and a group of current LSEG and former
Refinitiv senior management.
On December 12, 2022, Thomson
Reuters announced that it and certain investment funds affiliated
with Blackstone had agreed to sell shares in LSEG that they co-own
to Microsoft. On January 31, 2023,
the company sold 10.5 million LSEG shares for gross proceeds of
approximately $1.0 billion as part of
this transaction.
As of January 31, 2022, Thomson
Reuters indirectly owned approximately 61.5 million LSEG shares
which had a market value of approximately $5.6 billion based on LSEG's closing share price
on that day. Approximately 31 million additional LSEG shares were
released from the company's lock-up agreement with LSEG on
January 30, 2023 and are now able to
be sold by the company.
Recent Developments
On January 3, Thomson Reuters
completed the acquisition of SurePrep, a U.S.-based leader in 1040
tax automation software and services, for $500 million in cash. SurePrep's products and
solutions, including 1040SCAN, SPbinder and TaxCaddy, are used by
over 23,000 tax professionals at CPA firms, wealth management firms
and others. The acquisition supports Thomson Reuters' strategy of
pursuing both organic and inorganic growth opportunities as it
promotes seamless, cloud-based workflows for professionals through
innovative digital solutions and open, smart, and connected
platforms.
SurePrep is now part of the company's Tax and Accounting
Professionals operations, with revenues in both Tax &
Accounting Professionals and Corporates.
Thomson Reuters
Thomson Reuters is a leading provider of business information
services. Our products include highly specialized
information-enabled software and tools for legal, tax, accounting
and compliance professionals combined with the world's most global
news service – Reuters. For more information on Thomson Reuters,
visit tr.com and for the latest world news, reuters.com.
NON-IFRS FINANCIAL MEASURES
Thomson Reuters prepares its financial statements in
accordance with International Financial Reporting Standards (IFRS),
as issued by the International Accounting Standards Board
(IASB).
This news release includes certain non-IFRS financial
measures, which include ratios that incorporate one or more
non-IFRS financial measures, such as adjusted EBITDA and the
related margin (other than at the customer segment level), free
cash flow, adjusted EPS and the effective tax rate on 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. 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.
REVISION TO PRIOR-YEAR SEGMENT RESULTS
In the first quarter of 2022, the company made two changes to
its segment reporting to reflect how it currently manages its
businesses. The changes (i) reflect the transfer of certain
revenues from its Corporates business to its Tax & Accounting
Professionals business where they are better aligned; and (ii)
record intercompany revenue in Reuters News for content-related
services that it provides to Legal Professionals, Corporates and
Tax & Accounting Professionals. Previously, these services had
been reported as a transfer of expense from Reuters News to these
businesses. These changes impact the financial results of the
company's segments, but do not change the company's consolidated
financial results. The table below summarizes the changes for the
three months and year ended December 31,
2021.
|
Three Months Ended
December 31, 2021
|
|
Year Ended December
31, 2021
|
(millions of
U.S. dollars)
|
As
Reported
|
Adjustments
|
As
Revised
|
|
As
Reported
|
Adjustments
|
As
Revised
|
Revenues
|
|
|
|
|
|
|
|
Legal
Professionals
|
$689
|
-
|
$689
|
|
$2,712
|
-
|
$2,712
|
Corporates
|
361
|
$(3)
|
358
|
|
1,449
|
$(9)
|
1,440
|
Tax &
Accounting Professionals
|
309
|
3
|
312
|
|
906
|
9
|
915
|
"Big 3" Segments
Combined(1)
|
1,359
|
-
|
1,359
|
|
5,067
|
-
|
5,067
|
Reuters
News
|
182
|
5
|
187
|
|
674
|
20
|
694
|
Global
Print
|
170
|
-
|
170
|
|
609
|
-
|
609
|
Eliminations/Rounding
|
(1)
|
(5)
|
(6)
|
|
(2)
|
(20)
|
(22)
|
Revenues
|
$1,710
|
-
|
$1,710
|
|
$6,348
|
-
|
$6,348
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
$239
|
-
|
$239
|
|
$1,091
|
-
|
$1,091
|
Corporates
|
95
|
$(2)
|
93
|
|
502
|
$(6)
|
496
|
Tax &
Accounting Professionals
|
154
|
2
|
156
|
|
373
|
6
|
379
|
"Big 3" Segments
Combined(1)
|
488
|
-
|
488
|
|
1,966
|
-
|
1,966
|
Reuters
News
|
15
|
-
|
15
|
|
103
|
-
|
103
|
Global
Print
|
61
|
-
|
61
|
|
226
|
-
|
226
|
Corporate
costs
|
(112)
|
-
|
(112)
|
|
(325)
|
-
|
(325)
|
Adjusted
EBITDA
|
$452
|
-
|
$452
|
|
$1,970
|
-
|
$1,970
|
(1) See "Non-IFRS
Financial Measures" section and the tables appended to this news
release for additional information on these and other non-IFRS
financial measures.
|
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 and the
"Change Program", "2023 Outlook", "Dividends", "Share Repurchases –
Update on $2.0 Billion Buyback
Program", "Intention to Execute Return of Capital of at least
$2 Billion", "LSEG Ownership
Interest" sections, 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 17-30 in the "Risk
Factors" section of the company's 2021 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 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 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. For a discussion of material
assumptions and material risks related to the company's 2023
outlook, please see page 20 of the company's third-quarter
management's discussion and analysis (MD&A) for the period
ended September 30, 2022. The
company's quarterly MD&A and annual report are filed with, or
furnished to, the Canadian securities regulatory authorities and
the U.S. SEC and are also available in the "Investor Relations"
section of tr.com.
The company has provided an updated outlook for the purpose
of presenting information about current expectations for the
periods presented. This information may not be appropriate for
other purposes. You are cautioned not to place undue reliance on
forward-looking statements which reflect expectations only as of
the date of this news release.
Except as may be required by applicable law, Thomson Reuters
disclaims any obligation to update or revise any forward-looking
statements.
CONTACTS
MEDIA
Andrew Green
Senior Director,
Corporate Affairs
+1 332 219
1511
andrew.green@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 2022 results and its 2023 business
outlook today beginning at 8:30 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,
|
|
2022
|
2021
|
|
2022
|
2021
|
CONTINUING OPERATIONS
|
|
|
|
|
|
Revenues
|
$1,765
|
$1,710
|
|
$6,627
|
$6,348
|
Operating
expenses
|
(1,135)
|
(1,256)
|
|
(4,280)
|
(4,370)
|
Depreciation
|
(30)
|
(49)
|
|
(140)
|
(177)
|
Amortization of
computer software
|
(131)
|
(118)
|
|
(485)
|
(474)
|
Amortization of other
identifiable intangible assets
|
(23)
|
(29)
|
|
(99)
|
(119)
|
Other operating gains
(losses), net
|
185
|
(1)
|
|
211
|
34
|
Operating
profit
|
631
|
257
|
|
1,834
|
1,242
|
Finance costs,
net:
|
|
|
|
|
|
Net interest
expense
|
(51)
|
(50)
|
|
(196)
|
(196)
|
Other finance (costs)
income
|
(418)
|
(22)
|
|
444
|
8
|
Income before tax and
equity method investments
|
162
|
185
|
|
2,082
|
1,054
|
Share of post-tax
earnings (losses) in equity method
investments
|
120
|
(477)
|
|
(432)
|
6,240
|
Tax (expense)
benefit
|
(39)
|
115
|
|
(195)
|
(1,607)
|
Earnings (loss) from continuing
operations
|
243
|
(177)
|
|
1,455
|
5,687
|
Earnings (loss) from
discontinued operations, net of tax
|
39
|
2
|
|
(53)
|
2
|
Net earnings
(loss)
|
$282
|
$(175)
|
|
$1,402
|
$5,689
|
Earnings (loss)
attributable to common shareholders
|
$282
|
$(175)
|
|
$1,402
|
$5,689
|
|
|
|
|
|
|
Earnings (loss) per share:
|
|
|
|
|
|
Basic earnings (loss)
per share:
|
|
|
|
|
|
From
continuing operations
|
$0.51
|
$(0.36)
|
|
$3.00
|
$11.52
|
From
discontinued operations
|
0.08
|
-
|
|
(0.11)
|
0.01
|
Basic earnings (loss)
per share
|
$0.59
|
$(0.36)
|
|
$2.89
|
$11.53
|
|
|
|
|
|
|
Diluted earnings (loss)
per share:
|
|
|
|
|
|
From
continuing operations
|
$0.50
|
$(0.36)
|
|
$2.99
|
$11.50
|
From
discontinued operations
|
0.09
|
-
|
|
(0.11)
|
-
|
Diluted earnings (loss)
per share
|
$0.59
|
$(0.36)
|
|
$2.88
|
$11.50
|
|
|
|
|
|
|
Basic weighted-average
common shares
|
478,603,748
|
487,297,738
|
|
483,885,501
|
493,444,031
|
Diluted
weighted-average common shares
|
479,516,003
|
487,297,738
|
|
484,929,605
|
494,504,504
|
Thomson Reuters
Corporation
|
Consolidated
Statement of Financial Position
|
(millions of U.S.
dollars)
|
(unaudited)
|
|
|
December
31,
|
|
December
31,
|
2022
|
|
2021(1)
|
Assets
|
|
|
|
Cash and cash
equivalents
|
$1,069
|
|
$778
|
Trade and other
receivables
|
1,069
|
|
1,057
|
Other financial
assets
|
204
|
|
108
|
Prepaid expenses and
other current assets
|
469
|
|
510
|
Current
assets
|
2,811
|
|
2,453
|
|
|
|
|
Property and equipment,
net
|
414
|
|
502
|
Computer software,
net
|
922
|
|
822
|
Other identifiable
intangible assets, net
|
3,219
|
|
3,331
|
Goodwill
|
5,882
|
|
5,940
|
Equity method
investments
|
6,199
|
|
6,736
|
Other financial
assets
|
527
|
|
429
|
Other non-current
assets
|
619
|
|
797
|
Deferred tax
|
1,118
|
|
1,139
|
Total
assets
|
$21,711
|
|
$22,149
|
|
|
|
|
Liabilities and
equity
|
|
|
|
Liabilities
|
|
|
|
Current
indebtedness
|
$1,647
|
|
-
|
Payables, accruals and
provisions
|
1,222
|
|
$1,363
|
Current tax
liabilities
|
324
|
|
169
|
Deferred
revenue
|
886
|
|
874
|
Other financial
liabilities
|
812
|
|
175
|
Current
liabilities
|
4,891
|
|
2,581
|
|
|
|
|
Long-term
indebtedness
|
3,114
|
|
3,786
|
Provisions and other
non-current liabilities
|
691
|
|
709
|
Other financial
liabilities
|
233
|
|
234
|
Deferred tax
|
833
|
|
1,005
|
Total
liabilities
|
9,762
|
|
8,315
|
|
|
|
|
Equity
|
|
|
|
Capital
|
5,398
|
|
5,496
|
Retained
earnings
|
7,706
|
|
9,149
|
Accumulated other
comprehensive loss
|
(1,155)
|
|
(811)
|
Total
equity
|
11,949
|
|
13,834
|
Total liabilities
and equity
|
$21,711
|
|
$22,149
|
|
|
(1)
|
Prior-year period
amounts have been reclassified to reflect the current period
presentation.
|
Thomson Reuters
Corporation
|
Consolidated
Statement of Cash Flow
|
(millions of U.S.
dollars)
|
(unaudited)
|
|
|
Three Months
Ended
December
31,
|
|
Year
Ended
December
31,
|
|
2022
|
2021
|
|
2022
|
2021
|
Cash provided by
(used in):
|
|
|
|
|
|
Operating
activities
|
|
|
|
|
|
Earnings (loss) from
continuing operations
|
$243
|
$(177)
|
|
$1,455
|
$5,687
|
Adjustments
for:
|
|
|
|
|
|
Depreciation
|
30
|
49
|
|
140
|
177
|
Amortization of
computer software
|
131
|
118
|
|
485
|
474
|
Amortization of other
identifiable intangible assets
|
23
|
29
|
|
99
|
119
|
Share of post-tax
(earnings) losses in equity method investments
|
(120)
|
477
|
|
432
|
(6,240)
|
Net gains on disposals
of businesses and investments
|
(188)
|
-
|
|
(217)
|
(5)
|
Deferred
tax
|
49
|
(108)
|
|
(144)
|
662
|
Other
|
466
|
74
|
|
(276)
|
135
|
Changes in working
capital and other items
|
43
|
(69)
|
|
8
|
832
|
Operating cash flows
from continuing operations
|
677
|
393
|
|
1,982
|
1,841
|
Operating cash flows
from discontinued operations
|
(1)
|
4
|
|
(67)
|
(68)
|
Net cash provided by
operating activities
|
676
|
397
|
|
1,915
|
1,773
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
|
Acquisitions, net of
cash acquired
|
(1)
|
(13)
|
|
(191)
|
(18)
|
Proceeds from disposals
of businesses and investments
|
187
|
-
|
|
216
|
28
|
Dividend from sale of
LSEG shares
|
19
|
-
|
|
43
|
994
|
Capital
expenditures
|
(135)
|
(123)
|
|
(595)
|
(487)
|
Other investing
activities
|
1
|
25
|
|
88
|
81
|
Taxes paid on sale of
Refinitiv and LSEG shares
|
(7)
|
(188)
|
|
(7)
|
(850)
|
Investing cash flows
from continuing operations
|
64
|
(299)
|
|
(446)
|
(252)
|
Investing cash flows
from discontinued operations
|
-
|
-
|
|
(16)
|
(252)
|
Net cash provided by
(used in) investing activities
|
64
|
(299)
|
|
(462)
|
(504)
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
|
Net borrowings under
short-term loan facilities
|
673
|
-
|
|
1,042
|
-
|
Payments of lease
principal
|
(15)
|
(44)
|
|
(65)
|
(109)
|
Repurchases of common
shares
|
(584)
|
(597)
|
|
(1,282)
|
(1,400)
|
Dividends paid on
preference shares
|
(1)
|
-
|
|
(3)
|
(2)
|
Dividends paid on
common shares
|
(207)
|
(191)
|
|
(834)
|
(773)
|
Other financing
activities
|
2
|
3
|
|
(14)
|
11
|
Net cash used in
financing activities
|
(132)
|
(829)
|
|
(1,156)
|
(2,273)
|
Translation
adjustments
|
2
|
(2)
|
|
(6)
|
(5)
|
Increase (decrease) in
cash and cash equivalents
|
610
|
(733)
|
|
291
|
(1,009)
|
Cash and cash
equivalents at beginning of period
|
459
|
1,511
|
|
778
|
1,787
|
Cash and cash
equivalents at end of period
|
$1,069
|
$778
|
|
$1,069
|
$778
|
Thomson Reuters
Corporation
|
Reconciliation of
Earnings (Loss) 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,
|
|
2022
|
2021
|
|
|
2022
|
2021
|
|
|
|
|
|
|
|
Earnings (loss) from
continuing operations
|
$243
|
$(177)
|
|
|
$1,455
|
$5,687
|
Adjustments to
remove:
|
|
|
|
|
|
|
Tax expense
(benefit)
|
39
|
(115)
|
|
|
195
|
1,607
|
Other finance costs
(income)
|
418
|
22
|
|
|
(444)
|
(8)
|
Net interest
expense
|
51
|
50
|
|
|
196
|
196
|
Amortization of other
identifiable intangible assets
|
23
|
29
|
|
|
99
|
119
|
Amortization of
computer software
|
131
|
118
|
|
|
485
|
474
|
Depreciation
|
30
|
49
|
|
|
140
|
177
|
EBITDA
|
$935
|
$(24)
|
|
|
$2,126
|
$8,252
|
Adjustments to
remove:
|
|
|
|
|
|
|
Share of post-tax
(earnings) losses in equity method
investments
|
(120)
|
477
|
|
|
432
|
(6,240)
|
Other operating
(gains) losses, net
|
(185)
|
1
|
|
|
(211)
|
(34)
|
Fair value
adjustments*
|
3
|
(2)
|
|
|
(18)
|
(8)
|
Adjusted
EBITDA(1)
|
$633
|
$452
|
|
|
$2,329
|
$1,970
|
Adjusted EBITDA
margin(1)
|
35.9 %
|
26.4 %
|
|
|
35.1 %
|
31.0 %
|
|
* 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.
|
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,
|
|
2022
|
2021
|
|
2022
|
2021
|
Net cash provided by
operating activities
|
$676
|
$397
|
|
$1,915
|
$1,773
|
Capital
expenditures
|
(135)
|
(123)
|
|
(595)
|
(487)
|
Other investing
activities
|
1
|
25
|
|
88
|
81
|
Payments of lease
principal
|
(15)
|
(44)
|
|
(65)
|
(109)
|
Dividends paid on
preference shares
|
(1)
|
-
|
|
(3)
|
(2)
|
Free cash
flow(1)
|
$526
|
$255
|
|
$1,340
|
$1,256
|
Thomson Reuters
Corporation
|
Reconciliation of
Capital Expenditures to Accrued Capital Expenditures
(1)
|
(millions of U.S.
dollars)
|
(unaudited)
|
|
|
|
Year
Ended
December
31,
|
|
|
|
|
2022
|
2021
|
Capital
expenditures
|
|
|
$595
|
$487
|
Remove: IFRS adjustment
to cash basis
|
|
|
(50)
|
54
|
Accrued capital
expenditures(1)
|
|
|
$545
|
$541
|
Accrued capital
expenditures as a percentage of
revenues(1)
|
|
|
8.2 %
|
8.5 %
|
|
|
(1)
|
Refer to page 22 for
additional information on non-IFRS financial
measures.
|
Thomson Reuters
Corporation
|
Reconciliation of
Net Earnings (Loss) 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,
|
|
|
2022
|
2021
|
|
|
2022
|
2021
|
|
Net earnings
(loss)
|
$282
|
$(175)
|
|
|
$1,402
|
$5,689
|
|
Adjustments to
remove:
|
|
|
|
|
|
|
|
Fair value
adjustments*
|
3
|
(2)
|
|
|
(18)
|
(8)
|
|
Amortization of other
identifiable intangible assets
|
23
|
29
|
|
|
99
|
119
|
|
Other operating
(gains) losses, net
|
(185)
|
1
|
|
|
(211)
|
(34)
|
|
Other finance costs
(income)
|
418
|
22
|
|
|
(444)
|
(8)
|
|
Share of post-tax
(earnings) losses in equity method investments
|
(120)
|
477
|
|
|
432
|
(6,240)
|
|
Tax on above
items(1)
|
(22)
|
(141)
|
|
|
(22)
|
1,475
|
|
Tax items impacting
comparability(1)
|
(4)
|
(9)
|
|
|
(49)
|
(24)
|
|
(Earnings) loss from
discontinued operations, net of tax
|
(39)
|
(2)
|
|
|
53
|
(2)
|
|
Interim period
effective tax rate normalization(1)
|
(3)
|
10
|
|
|
-
|
-
|
|
Dividends declared on
preference shares
|
(1)
|
-
|
|
|
(3)
|
(2)
|
|
Adjusted
earnings(1)
|
$352
|
$210
|
|
|
$1,239
|
$965
|
|
Adjusted
EPS(1)
|
$0.73
|
$0.43
|
|
|
$2.56
|
$1.95
|
|
Total
change
|
70 %
|
|
|
|
31 %
|
|
|
Foreign
currency
|
-2 %
|
|
|
|
1 %
|
|
|
Constant
currency
|
72 %
|
|
|
|
30 %
|
|
|
|
|
|
|
|
|
|
|
Diluted
weighted-average common shares (millions)
|
479.5
|
488.6(2)
|
|
|
484.9
|
494.5
|
|
Reconciliation of
Effective Tax Rate on Adjusted
Earnings(1)
|
Year ended
December 31,
|
|
2022
|
2021
|
Adjusted
earnings
|
$1,239
|
$965
|
Plus: Dividends
declared on preference shares
|
3
|
2
|
Plus: Tax expense on
adjusted earnings
|
266
|
156
|
Pre-Tax Adjusted
earnings
|
$1,508
|
$1,123
|
|
|
|
IFRS Tax
expense
|
$195
|
$1,607
|
Remove tax related
to:
|
|
|
Amortization of other
identifiable intangible assets
|
22
|
26
|
Share of post-tax
losses (earnings) in equity method investments
|
124
|
(1,497)
|
Other finance
income
|
(80)
|
5
|
Other operating gains,
net
|
(42)
|
(9)
|
Other items
|
(2)
|
-
|
Subtotal – Remove tax
benefit (expense) on pre-tax items removed from adjusted
earnings
|
22
|
(1,475)
|
Remove: Tax items
impacting comparability
|
49
|
24
|
Total: Remove all items
above impacting comparability
|
71
|
(1,451)
|
|
|
|
Tax expense on
adjusted earnings
|
$266
|
$156
|
Effective tax rate
on adjusted earnings
|
17.6 %
|
13.9 %
|
|
* 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.
|
|
(1) Refer to page
22 for additional information on non-IFRS financial
measures.
|
(2) Refer to page
18 regarding IFRS and non-IFRS share information.
|
The following table reconciles IFRS and non-IFRS common share
information:
(weighted-average
common shares)
|
Three Months
Ended
December 31,
2021
|
|
IFRS: Basic and
Diluted
|
487,297,738
|
|
Effect of stock
options and other equity incentive awards
|
1,291,196
|
|
Non-IFRS
Diluted
|
488,588,934
|
|
|
Because Thomson Reuters
reported a net loss for continuing operations under IFRS for the
three months ended December 31, 2021, the weighted-average number
of common shares used for basic and diluted loss per share is the
same for all per-share calculations in the period, as the effect of
stock options and other equity incentive awards would reduce the
loss per share, and therefore be anti-dilutive. Since the company's
non-IFRS measure "adjusted earnings" is a profit, potential common
shares are included, as they lower adjusted EPS and are therefore
dilutive.
|
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
|
|
|
|
2022
|
2021(2)
|
|
Total
|
Foreign
Currency
|
SUBTOTAL
Constant
Currency
|
Acquisitions/
(Divestitures)
|
Organic
|
|
Total
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$704
|
$689
|
|
2 %
|
-2 %
|
4 %
|
-1 %
|
5 %
|
|
Corporates
|
|
379
|
358
|
|
6 %
|
-1 %
|
7 %
|
-2 %
|
9 %
|
|
Tax &
Accounting Professionals
|
|
326
|
312
|
|
5 %
|
-1 %
|
5 %
|
-3 %
|
8 %
|
|
"Big 3" Segments
Combined(1)
|
|
1,409
|
1,359
|
|
4 %
|
-2 %
|
5 %
|
-2 %
|
7 %
|
|
Reuters
News
|
|
198
|
187
|
|
7 %
|
-4 %
|
10 %
|
0 %
|
10 %
|
|
Global
Print
|
|
162
|
170
|
|
-4 %
|
-2 %
|
-2 %
|
-1 %
|
-1 %
|
|
Eliminations/Rounding
|
|
(4)
|
(6)
|
|
|
|
|
|
|
|
Revenues
|
|
$1,765
|
$1,710
|
|
3 %
|
-2 %
|
5 %
|
-1 %
|
6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Recurring
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$664
|
$642
|
|
4 %
|
-2 %
|
5 %
|
-1 %
|
6 %
|
|
Corporates
|
|
337
|
311
|
|
8 %
|
-1 %
|
10 %
|
-2 %
|
11 %
|
|
Tax &
Accounting Professionals
|
|
292
|
279
|
|
4 %
|
-1 %
|
5 %
|
-3 %
|
8 %
|
|
"Big 3" Segments
Combined(1)
|
|
1,293
|
1,232
|
|
5 %
|
-2 %
|
6 %
|
-1 %
|
8 %
|
|
Reuters
News
|
|
153
|
150
|
|
3 %
|
-2 %
|
5 %
|
0 %
|
5 %
|
|
Eliminations/Rounding
|
|
(4)
|
(6)
|
|
|
|
|
|
|
|
Total Recurring
Revenues
|
|
$1,442
|
$1,376
|
|
5 %
|
-2 %
|
6 %
|
-1 %
|
7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Transactions
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$40
|
$47
|
|
-16 %
|
-6 %
|
-11 %
|
-2 %
|
-8 %
|
|
Corporates
|
|
42
|
47
|
|
-10 %
|
-2 %
|
-8 %
|
-3 %
|
-5 %
|
|
Tax &
Accounting Professionals
|
|
34
|
33
|
|
6 %
|
0 %
|
6 %
|
-4 %
|
10 %
|
|
"Big 3" Segments
Combined(1)
|
|
116
|
127
|
|
-8 %
|
-3 %
|
-5 %
|
-3 %
|
-2 %
|
|
Reuters
News
|
|
45
|
37
|
|
22 %
|
-9 %
|
31 %
|
0 %
|
31 %
|
|
Total Transactions
Revenues
|
|
$161
|
$164
|
|
-2 %
|
-4 %
|
3 %
|
-3 %
|
5 %
|
|
|
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.
|
(2) Revised to
reflect the changes made to the company's segment reporting in the
first quarter of 2022.
|
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
|
|
|
|
2022
|
2021(2)
|
|
Total
|
Foreign
Currency
|
SUBTOTAL
Constant
Currency
|
Acquisitions/
(Divestitures)
|
Organic
|
|
Total
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$2,803
|
$2,712
|
|
3 %
|
-2 %
|
5 %
|
-1 %
|
6 %
|
|
Corporates
|
|
1,536
|
1,440
|
|
7 %
|
-1 %
|
8 %
|
0 %
|
8 %
|
|
Tax &
Accounting Professionals
|
|
986
|
915
|
|
8 %
|
-1 %
|
8 %
|
-1 %
|
9 %
|
|
"Big 3" Segments
Combined(1)
|
|
5,325
|
5,067
|
|
5 %
|
-1 %
|
6 %
|
-1 %
|
7 %
|
|
Reuters
News
|
|
733
|
694
|
|
6 %
|
-3 %
|
9 %
|
0 %
|
9 %
|
|
Global
Print
|
|
592
|
609
|
|
-3 %
|
-2 %
|
-1 %
|
0 %
|
-1 %
|
|
Eliminations/Rounding
|
|
(23)
|
(22)
|
|
|
|
|
|
|
|
Revenues
|
|
$6,627
|
$6,348
|
|
4 %
|
-2 %
|
6 %
|
0 %
|
6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Recurring
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$2,631
|
$2,523
|
|
4 %
|
-2 %
|
6 %
|
0 %
|
6 %
|
|
Corporates
|
|
1,305
|
1,209
|
|
8 %
|
-1 %
|
9 %
|
0 %
|
9 %
|
|
Tax &
Accounting Professionals
|
|
799
|
742
|
|
8 %
|
-1 %
|
8 %
|
-1 %
|
9 %
|
|
"Big 3" Segments
Combined(1)
|
|
4,735
|
4,474
|
|
6 %
|
-1 %
|
7 %
|
0 %
|
8 %
|
|
Reuters
News
|
|
612
|
596
|
|
3 %
|
-3 %
|
5 %
|
0 %
|
5 %
|
|
Eliminations/Rounding
|
|
(23)
|
(22)
|
|
|
|
|
|
|
|
Total Recurring
Revenues
|
|
$5,324
|
$5,048
|
|
5 %
|
-2 %
|
7 %
|
0 %
|
7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Transactions
Revenues
|
|
|
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$172
|
$189
|
|
-9 %
|
-2 %
|
-7 %
|
-2 %
|
-5 %
|
|
Corporates
|
|
231
|
231
|
|
0 %
|
-1 %
|
1 %
|
-1 %
|
2 %
|
|
Tax &
Accounting Professionals
|
|
187
|
173
|
|
8 %
|
0 %
|
8 %
|
-1 %
|
9 %
|
|
"Big 3" Segments
Combined(1)
|
|
590
|
593
|
|
-1 %
|
-1 %
|
1 %
|
-1 %
|
2 %
|
|
Reuters
News
|
|
121
|
98
|
|
24 %
|
-7 %
|
31 %
|
0 %
|
31 %
|
|
Total Transactions
Revenues
|
|
$711
|
$691
|
|
3 %
|
-2 %
|
5 %
|
-1 %
|
6 %
|
|
|
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.
|
(2) Revised to
reflect the changes made to the company's segment reporting in the
first quarter of 2022.
|
Thomson Reuters
Corporation
|
Reconciliation of
Changes in Adjusted EBITDA(1) to Changes on a Constant
Currency Basis(1)
|
(millions of
U.S. dollars)
|
(unaudited)
|
|
|
|
Three Months Ended
|
|
|
|
December 31,
|
|
Change
|
|
|
2022
|
2021(2)
|
|
Total
|
Foreign
Currency
|
Constant
Currency
|
Adjusted
EBITDA(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$294
|
$239
|
|
23 %
|
-3 %
|
27 %
|
Corporates
|
|
135
|
93
|
|
45 %
|
-1 %
|
46 %
|
Tax &
Accounting Professionals
|
|
189
|
156
|
|
22 %
|
1 %
|
21 %
|
"Big 3" Segments
Combined(1)
|
|
618
|
488
|
|
27 %
|
-1 %
|
28 %
|
Reuters
News
|
|
40
|
15
|
|
162 %
|
37 %
|
125 %
|
Global
Print
|
|
59
|
61
|
|
-3 %
|
-2 %
|
-1 %
|
Corporate
costs
|
|
(84)
|
(112)
|
|
n/a
|
n/a
|
n/a
|
Adjusted
EBITDA
|
|
$633
|
$452
|
|
40 %
|
-1 %
|
41 %
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
41.7 %
|
34.5 %
|
|
720bp
|
-20bp
|
740bp
|
Corporates
|
|
35.7 %
|
26.0 %
|
|
970bp
|
30bp
|
940bp
|
Tax &
Accounting Professionals
|
|
58.1 %
|
50.0 %
|
|
810bp
|
70bp
|
740bp
|
"Big 3" Segments
Combined(1)
|
|
43.9 %
|
35.8 %
|
|
810bp
|
30bp
|
780bp
|
Reuters
News
|
|
19.8 %
|
8.1 %
|
|
1170bp
|
330bp
|
840bp
|
Global
Print
|
|
36.1 %
|
35.9 %
|
|
20bp
|
0bp
|
20bp
|
Adjusted EBITDA
margin
|
|
35.9 %
|
26.4 %
|
|
950bp
|
30bp
|
920bp
|
|
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.
|
(2) Revised to
reflect the changes made to the company's segment reporting in the
first quarter of 2022.
|
Thomson Reuters
Corporation
|
Reconciliation of
Changes in Adjusted EBITDA(1) to Changes on a Constant
Currency Basis(1)
|
(millions of
U.S. dollars)
|
(unaudited)
|
|
|
|
Year Ended
|
|
|
|
|
December 31,
|
|
Change
|
|
|
2022
|
2021(2)
|
|
Total
|
Foreign
Currency
|
Constant
Currency
|
Adjusted
EBITDA(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
$1,227
|
$1,091
|
|
13 %
|
-2 %
|
14 %
|
Corporates
|
|
578
|
496
|
|
17 %
|
0 %
|
16 %
|
Tax &
Accounting Professionals
|
|
451
|
379
|
|
19 %
|
1 %
|
18 %
|
"Big 3" Segments
Combined(1)
|
|
2,256
|
1,966
|
|
15 %
|
-1 %
|
16 %
|
Reuters
News
|
|
154
|
103
|
|
50 %
|
14 %
|
36 %
|
Global
Print
|
|
212
|
226
|
|
-6 %
|
-2 %
|
-4 %
|
Corporate
costs
|
|
(293)
|
(325)
|
|
n/a
|
n/a
|
n/a
|
Adjusted
EBITDA
|
|
$2,329
|
$1,970
|
|
18 %
|
0 %
|
18 %
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Margin(1)
|
|
|
|
|
|
|
|
Legal
Professionals
|
|
43.8 %
|
40.2 %
|
|
360bp
|
10bp
|
350bp
|
Corporates
|
|
37.6 %
|
34.4 %
|
|
320bp
|
50bp
|
270bp
|
Tax &
Accounting Professionals
|
|
45.8 %
|
41.3 %
|
|
450bp
|
60bp
|
390bp
|
"Big 3" Segments
Combined(1)
|
|
42.4 %
|
38.8 %
|
|
360bp
|
30bp
|
330bp
|
Reuters
News
|
|
21.0 %
|
14.8 %
|
|
620bp
|
240bp
|
380bp
|
Global
Print
|
|
35.7 %
|
37.1 %
|
|
-140bp
|
-10bp
|
-130bp
|
Adjusted EBITDA
margin
|
|
35.1 %
|
31.0 %
|
|
410bp
|
60bp
|
350bp
|
|
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.
|
(2) Revised to
reflect the changes made to the company's segment reporting in the
first quarter of 2022.
|
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 other identifiable
intangible assets, other operating gains and losses, certain asset
impairment charges, other finance costs or income, Thomson Reuters
share of post-tax earnings or losses in equity method investments,
discontinued operations and other items affecting
comparability.
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, proceeds from disposals of property and
equipment, and other investing activities, less capital
expenditures, payments of lease principal and dividends paid on the
company's preference shares.
|
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.
In 2023, this measure
excludes $30 million of capital expenditures related to real
estate.
|
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.
|
|
View original content to download
multimedia:https://www.prnewswire.com/news-releases/thomson-reuters-reports-fourth-quarter-and-full-year-2022-results-301742975.html
SOURCE Thomson Reuters