Thomson Reuters Reports Second-Quarter 2024 Results
- Good revenue momentum continued in the second quarter
- Total company and organic revenues both up 6%
- Organic revenues up 8% for the "Big 3" segments (Legal Professionals, Corporates and Tax & Accounting Professionals)
- Total company and organic revenues both up 6%
- Based on Q2 performance, raised full-year 2024 outlook for total and organic revenue growth to the high end of the prior ranges
- Completed monetization of interest in London Stock Exchange Group (LSEG) in the second quarter
- Completed
$1.0 billion share buyback program- Repurchased
$287 million of the company's common shares in the second quarter
- Repurchased
"Good momentum continued across our portfolio in the second quarter, leading to a moderately raised revenue outlook," said
Consolidated Financial Highlights - Three Months Ended
Three Months Ended
(Millions of (unaudited)
|
||||
IFRS Financial Measures (1) |
2024 |
2023 |
Change |
Change at |
Revenues |
|
|
6 % |
|
Operating profit |
|
|
-50 % |
|
Diluted earnings per share (EPS) |
|
|
-2 % |
|
Net cash provided by operating activities |
|
|
2 % |
|
Non-IFRS Financial Measures (1) |
|
|
|
|
Revenues |
|
|
6 % |
6 % |
Adjusted EBITDA |
|
|
-2 % |
-2 % |
Adjusted EBITDA margin |
37.1 % |
40.1 % |
-300bp |
-330bp |
Adjusted EPS |
|
|
-3 % |
-5 % |
Free cash flow |
|
|
-9 % |
|
(1)
In addition to results reported in accordance with International Financial Reporting Standards (IFRS), the company uses certain
(2)
As of |
Revenues increased 6%, driven by growth in recurring and transactions revenues. Foreign currency had no impact on revenue growth.
- Organic revenues increased 6%, driven by 8% growth in recurring revenues (82% of total revenues) and 5% growth in transactions revenues. Global Print revenues decreased 7% organically.
- The company's "Big 3" segments reported organic revenue growth of 8% and collectively comprised 82% of total revenues.
Operating profit decreased 50% primarily because the 2023 period included a
- Adjusted EBITDA, which excludes the gain on sale of Elite, as well as other items, decreased 2% as higher revenues were more than offset by growth investments and the impact of acquisitions. The related margin decreased to 37.1% from 40.1% in the prior-year period. Foreign currency contributed 30 basis points to the year-over-year change in adjusted EBITDA margin.
Diluted EPS decreased to
-
Adjusted EPS, which excludes the gain on sale of Elite, the changes in value of the company's LSEG investment, the non-cash tax benefit, as well as other adjustments, decreased to
$0.85 per share from$0.88 per share in the prior-year period, as lower adjusted EBITDA, higher internally developed software amortization and higher taxes more than offset a benefit from a reduction in weighted-average common shares.
Net cash provided by operating activities increased by
-
Free cash flow decreased
$55 million as the increase in cash flow from operating activities was more than offset by higher capital expenditures and lower cash flows from other investing activities.
Highlights by Customer Segment – Three Months Ended
(Millions of (unaudited)
|
||||||||||||||||||||||
|
|
Three Months Ended |
|
|
|
|
||||||||||||||||
|
|
|
|
Change |
||||||||||||||||||
|
|
2024 |
2023 |
|
Total |
Constant |
Organic (1)(2) |
|||||||||||||||
Revenues |
|
|
|
|
|
|
|
|||||||||||||||
Legal Professionals |
|
|
|
|
3 % |
3 % |
7 % |
|||||||||||||||
Corporates |
|
442 |
392 |
|
13 % |
13 % |
8 % |
|||||||||||||||
Tax & Accounting Professionals |
|
250 |
229 |
|
9 % |
12 % |
10 % |
|||||||||||||||
"Big 3" Segments Combined(1) |
|
1,419 |
1,326 |
|
7 % |
8 % |
8 % |
|||||||||||||||
|
|
205 |
194 |
|
6 % |
7 % |
4 % |
|||||||||||||||
Global Print |
|
123 |
133 |
|
-8 % |
-7 % |
-7 % |
|||||||||||||||
Eliminations/Rounding |
|
(7) |
(6) |
|
|
|
|
|||||||||||||||
Revenues |
|
|
|
|
6 % |
6 % |
6 % |
|||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
Adjusted EBITDA( 1) |
|
|
|
|
|
|
|
|||||||||||||||
Legal Professionals |
|
|
|
|
-5 % |
-6 % |
|
|||||||||||||||
Corporates |
|
163 |
163 |
|
0 % |
0 % |
|
|||||||||||||||
Tax & Accounting Professionals |
|
91 |
89 |
|
3 % |
5 % |
|
|||||||||||||||
"Big 3" Segments Combined(1) |
|
581 |
597 |
|
-3 % |
-3 % |
|
|||||||||||||||
|
|
51 |
45 |
|
13 % |
14 % |
|
|||||||||||||||
Global Print |
|
43 |
53 |
|
-18 % |
-18 % |
|
|||||||||||||||
Corporate costs |
|
(29) |
(33) |
|
n/a |
n/a |
|
|||||||||||||||
Adjusted EBITDA |
|
|
|
|
-2 % |
-2 % |
|
|||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
Adjusted EBITDA Margin( 1) |
|
|
|
|
|
|
|
|||||||||||||||
Legal Professionals |
|
45.0 % |
48.9 % |
|
-390bp |
-440bp |
|
|||||||||||||||
Corporates |
|
36.8 % |
41.6 % |
|
-480bp |
-500bp |
|
|||||||||||||||
Tax & Accounting Professionals |
|
36.8 % |
38.5 % |
|
-170bp |
-190bp |
|
|||||||||||||||
"Big 3" Segments Combined(1) |
|
41.0 % |
44.9 % |
|
-390bp |
-430bp |
|
|||||||||||||||
|
|
24.8 % |
23.1 % |
|
170bp |
140bp |
|
|||||||||||||||
Global Print |
|
35.2 % |
39.7 % |
|
-450bp |
-450bp |
|
|||||||||||||||
Adjusted EBITDA margin |
|
37.1 % |
40.1 % |
|
-300bp |
-330bp |
|
|||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
(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 constantcurrency (or exclude the impact of foreign currency) as Thomson Reuters believes this provides the best basis to measure their performance.
Legal Professionals
Revenues increased 3% to
- Recurring revenues increased 5% (97% of total, 8% organic). Organic growth was primarily driven by Westlaw, Practical Law, CoCounsel and the segment's international businesses.
- Transactions revenues decreased 33% (3% of total, increased 3% organic).
Adjusted EBITDA decreased 5% to
- The margin decreased to 45.0% from 48.9% primarily driven by higher investments and the Casetext acquisition.
Corporates
Revenues increased 13% to
- Recurring revenues increased 13% (86% of total, 10% organic). Organic growth was primarily driven by Practical Law, Indirect Tax, Clear and
Pagero . - Transactions revenues increased 17% (14% of total, 1% organic) driven primarily by
Pagero and the segment's international businesses.
Adjusted EBITDA was unchanged at
- The margin decreased to 36.8% from 41.6%, driven by the
Pagero acquisition and higher investments.
Tax & Accounting Professionals
Revenues increased 12% to
- Recurring revenues increased 10% (72% of total, all organic). Organic growth was driven by the segment's
Latin America business and audit products. - Transactions revenues increased 16% (28% of total, 11% organic) primarily due to
SurePrep and Confirmation.
Adjusted EBITDA increased 3% to
- The margin decreased to 36.8% from 38.5%, 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.
Revenues of
Adjusted EBITDA increased 13% to
Global Print
Revenues of
Adjusted EBITDA decreased 18% to
- The margin decreased to 35.2% from 39.7% due to lower revenues.
Corporate Costs
Corporate costs were
Consolidated Financial Highlights - Six Months Ended
Six Months Ended
(Millions of (unaudited)
|
||||
IFRS Financial Measures (1) |
2024 |
2023 |
Change |
Change at |
Revenues |
|
|
7 % |
|
Operating profit |
|
|
-27 % |
|
Diluted EPS |
|
|
-16 % |
|
Net cash provided by operating activities |
|
|
18 % |
|
Non-IFRS Financial Measures (1) |
|
|
|
|
Revenues |
|
|
7 % |
7 % |
Adjusted EBITDA |
|
|
8 % |
8 % |
Adjusted EBITDA margin |
40.0 % |
39.4 % |
60bp |
40bp |
Adjusted EPS |
|
|
15 % |
15 % |
Free cash flow |
|
|
11 % |
|
(1)
In addition to results reported in accordance with IFRS, the company uses certain non-IFRS financial measures as supplemental
(2)
As of |
Revenues increased 7%, driven by growth in recurring and transactions revenues. Net divestitures had a 1% negative impact and foreign currency had no impact on revenue growth.
- Organic revenues increased 8%, driven by 8% growth in recurring revenues (78% of total revenues) and 15% growth in transactions revenues. Global Print revenues decreased 9% organically.
- The company's "Big 3" segments reported organic revenue growth of 9% and collectively comprised 82% of total revenues.
Operating profit decreased 27%, primarily because the 2023 period included a
- Adjusted EBITDA, which excludes the gain on sale of Elite, as well as other items, increased 8% as higher revenues more than offset growth investments and the impact of acquisitions. The related margin increased to 40.0% from 39.4% in the prior-year period. Foreign currency contributed 20 basis points to the year-over-year change in adjusted EBITDA margin.
Diluted EPS decreased to
-
Adjusted EPS, which excludes the gain on sale of Elite, the changes in value of the company's LSEG investment, the non-cash tax benefit, as well as other adjustments, increased to
$1.97 per share from$1.71 per share in the prior-year period, primarily due to higher adjusted EBITDA. In 2024, diluted EPS also benefited from a reduction in weighted-average common shares.
Net cash provided by operating activities increased by
-
Free cash flow increased
$83 million as higher cash flows from operating activities more than offset higher capital expenditures and lower cash flows from other investing activities.
Highlights by Customer Segment - Six Months Ended
(Millions of (unaudited)
|
||||||||||||||||||||||
|
|
Six Months Ended |
|
|
|
|
||||||||||||||||
|
|
|
|
Change |
||||||||||||||||||
|
|
2024 |
2023 |
|
Total |
Constant |
Organic (1)(2) |
|||||||||||||||
Revenues |
|
|
|
|
|
|
|
|||||||||||||||
Legal Professionals |
|
|
|
|
2 % |
2 % |
7 % |
|||||||||||||||
Corporates |
|
949 |
827 |
|
15 % |
15 % |
10 % |
|||||||||||||||
Tax & Accounting Professionals |
|
578 |
511 |
|
13 % |
15 % |
12 % |
|||||||||||||||
"Big 3" Segments Combined(1) |
|
2,975 |
2,757 |
|
8 % |
8 % |
9 % |
|||||||||||||||
|
|
415 |
369 |
|
13 % |
13 % |
10 % |
|||||||||||||||
Global Print |
|
247 |
271 |
|
-9 % |
-9 % |
-9 % |
|||||||||||||||
Eliminations/Rounding |
|
(12) |
(12) |
|
|
|
|
|||||||||||||||
Revenues |
|
|
|
|
7 % |
7 % |
8 % |
|||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
Adjusted EBITDA( 1) |
|
|
|
|
|
|
|
|||||||||||||||
Legal Professionals |
|
|
|
|
1 % |
1 % |
|
|||||||||||||||
Corporates |
|
356 |
317 |
|
12 % |
12 % |
|
|||||||||||||||
Tax & Accounting Professionals |
|
272 |
238 |
|
14 % |
16 % |
|
|||||||||||||||
"Big 3" Segments Combined(1) |
|
1,297 |
1,218 |
|
7 % |
7 % |
|
|||||||||||||||
|
|
111 |
74 |
|
50 % |
51 % |
|
|||||||||||||||
Global Print |
|
90 |
103 |
|
-12 % |
-12 % |
|
|||||||||||||||
Corporate costs |
|
(46) |
(56) |
|
n/a |
n/a |
|
|||||||||||||||
Adjusted EBITDA |
|
|
|
|
8 % |
8 % |
|
|||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
Adjusted EBITDA Margin( 1) |
|
|
|
|
|
|
|
|||||||||||||||
Legal Professionals |
|
46.2 % |
46.7 % |
|
-50bp |
-60bp |
|
|||||||||||||||
Corporates |
|
37.3 % |
38.2 % |
|
-90bp |
-100bp |
|
|||||||||||||||
Tax & Accounting Professionals |
|
47.1 % |
45.7 % |
|
140bp |
140bp |
|
|||||||||||||||
"Big 3" Segments Combined(1) |
|
43.5 % |
44.0 % |
|
-50bp |
-50bp |
|
|||||||||||||||
|
|
26.6 % |
20.0 % |
|
660bp |
660bp |
|
|||||||||||||||
Global Print |
|
36.7 % |
38.1 % |
|
-140bp |
-150bp |
|
|||||||||||||||
Adjusted EBITDA margin |
|
40.0 % |
39.4 % |
|
60bp |
40bp |
|
|||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
(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 |
2024 Outlook
The company raised its 2024 outlook for total and organic revenue growth to the high end of the ranges provided in its outlook on
The company's outlook for 2024 in the table below assumes constant currency rates and 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 third-quarter 2024 organic revenue growth to be approximately 6% and its adjusted EBITDA margin to be approximately 34%.
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 2023 Results and Full-Year 2024 Outlook
Total Thomson Reuters |
FY 2023 Reported |
FY 2024 Outlook
|
FY 2024 Outlook
|
FY 2024 Outlook
|
Total Revenue Growth |
3 % |
~ 6.5% |
6.5% - 7.0% |
~ 7.0% |
Organic Revenue Growth(1) |
6 % |
~ 6% |
6.0% - 6.5% |
~ 6.5% |
Adjusted EBITDA Margin(1) |
39.3 % |
~ 38% |
Unchanged |
Unchanged |
Corporate Costs |
|
|
Unchanged |
Unchanged |
Free Cash Flow(1) |
|
~ |
Unchanged |
Unchanged |
Accrued Capex as % of Revenue(1) |
7.8 % |
~ 8.5% |
Unchanged |
Unchanged |
Depreciation & Amortization of Depreciation & Amortization of Internally
Amortization of |
|
~ |
Unchanged
Unchanged Unchanged |
Unchanged
~ |
Interest Expense (P&L)(2) |
|
|
Unchanged |
|
Effective Tax Rate on Adjusted Earnings(1) |
16.5 % |
~ 18% |
Unchanged |
Unchanged |
"Big 3" Segments(1) |
FY 2023 Reported |
FY 2024 Outlook
|
FY 2024 Outlook
|
FY 2024 Outlook
|
Total Revenue Growth |
3 % |
~ 8% |
8.0% - 8.5% |
~ 8.5% |
Organic Revenue Growth |
7 % |
~ 7.5% |
7.5% - 8.0% |
~ 8.0% |
Adjusted EBITDA Margin |
43.8 % |
~ 43% |
Unchanged |
Unchanged |
|
|
(1) |
Non-IFRS financial measures. See the "Non-IFRS Financial Measures" section below as well as the tables and footnotes appended to this news release for more information. |
(2) |
Full-year 2023 interest expense excludes a |
The information in this section is forward-looking. Actual results, which will include the impact of currency and future acquisitions and dispositions completed during 2024 may differ materially from the company's 2024 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
In
Share Repurchases – Completed
In
As of
LSEG Ownership Interest
Thomson Reuters indirectly owned LSEG shares through an entity that it jointly owns with
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
This news release includes certain non-IFRS financial measures, which include ratios that incorporate one or more non-IFRS financial measures, such as adjusted EBITDA (other than at the customer segment level) and the related margin, free cash flow, adjusted earnings and the effective tax rate on adjusted earnings, adjusted EPS, accrued capital expenditures expressed as a percentage of revenues, selected measures excluding the impact of foreign currency, changes in revenues computed on an organic basis as well as all financial measures for the "Big 3" segments.
As of
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. 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
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS, MATERIAL RISKS AND MATERIAL ASSUMPTIONS
Certain statements in this news release, including, but not limited to, statements in
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
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 2024 outlook see page 18 of the company's first-quarter management's discussion and analysis (MD&A) for the period ended
The company has provided an outlook for the purpose of presenting information about current expectations for the period 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
Head of Investor Relations +1 646 540 3249 |
Thomson Reuters will webcast a discussion of its second-quarter 2024 results and its 2024 business outlook today beginning at
Consolidated Income Statement
(millions of (unaudited) |
||||||||
|
||||||||
|
Three Months Ended |
|
Six Months Ended |
|||||
|
|
|
|
|||||
|
2024 |
2023 |
|
2024 |
2023 |
|||
CONTINUING OPERATIONS |
|
|
|
|
|
|||
Revenues |
|
|
|
|
|
|||
Operating expenses |
(1,090) |
(990) |
|
(2,171) |
(2,064) |
|||
Depreciation |
(29) |
(29) |
|
(57) |
(59) |
|||
Amortization of computer software |
(154) |
(127) |
|
(307) |
(245) |
|||
Amortization of other identifiable intangible assets |
(23) |
(23) |
|
(48) |
(48) |
|||
Other operating (losses) gains, net |
(29) |
347 |
|
(70) |
364 |
|||
Operating profit |
415 |
825 |
|
972 |
1,333 |
|||
Finance costs, net: |
|
|
|
|
|
|||
Net interest expense |
(36) |
(34) |
|
(76) |
(89) |
|||
Other finance income (costs) |
2 |
(102) |
|
24 |
(192) |
|||
Income before tax and equity method investments |
381 |
689 |
|
920 |
1,052 |
|||
Share of post-tax earnings in equity method investments |
61 |
419 |
|
53 |
989 |
|||
Tax benefit (expense) |
402 |
(219) |
|
335 |
(415) |
|||
Earnings from continuing operations |
844 |
889 |
|
1,308 |
1,626 |
|||
(Loss) earnings from discontinued operations, net of tax |
(3) |
5 |
|
11 |
24 |
|||
Net earnings |
|
|
|
|
|
|||
Earnings (loss) attributable to: |
|
|
|
|
|
|||
Common shareholders |
|
|
|
|
|
|||
Non-controlling interests |
- |
- |
|
(3) |
- |
|||
|
|
|
|
|
|
|||
Earnings per share: |
|
|
|
|
|
|||
Basic earnings (loss) per share: |
|
|
|
|
|
|||
From continuing operations |
|
|
|
|
|
|||
From discontinued operations |
(0.01) |
0.01 |
|
0.02 |
0.05 |
|||
Basic earnings per share |
|
|
|
|
|
|||
|
|
|
|
|
|
|||
Diluted earnings (loss) per share: |
|
|
|
|
|
|||
From continuing operations |
|
|
|
|
|
|||
From discontinued operations |
(0.01) |
0.01 |
|
0.03 |
0.06 |
|||
Diluted earnings per share |
|
|
|
|
|
|||
|
|
|
|
|
|
|||
Basic weighted-average common shares |
450,364,361 |
469,756,868 |
|
451,244,365 |
471,495,910 |
|||
Diluted weighted-average common shares |
450,911,513 |
470,382,600 |
|
451,886,658 |
472,509,030 |
Consolidated Statement of Financial Position
(millions of (unaudited) |
|||
|
|||
|
|
|
|
2024 |
|
2023 |
|
Assets |
|
|
|
Cash and cash equivalents |
|
|
|
Trade and other receivables |
1,093 |
|
1,122 |
Other financial assets |
17 |
|
66 |
Prepaid expenses and other current assets |
474 |
|
435 |
Current assets |
3,266 |
|
2,921 |
|
|
|
|
Property and equipment, net |
436 |
|
447 |
Computer software, net |
1,473 |
|
1,236 |
Other identifiable intangible assets, net |
3,184 |
|
3,165 |
|
7,298 |
|
6,719 |
Equity method investments |
230 |
|
2,030 |
Other financial assets |
419 |
|
444 |
Other non-current assets |
620 |
|
618 |
Deferred tax |
1,452 |
|
1,104 |
Total assets |
|
|
|
|
|
|
|
Liabilities and equity |
|
|
|
Liabilities |
|
|
|
Current indebtedness |
|
|
|
Payables, accruals and provisions |
1,027 |
|
1,114 |
Current tax liabilities |
325 |
|
248 |
Deferred revenue |
1,024 |
|
992 |
Other financial liabilities |
88 |
|
507 |
Current liabilities |
3,728 |
|
3,233 |
|
|
|
|
Long-term indebtedness |
1,846 |
|
2,905 |
Provisions and other non-current liabilities |
678 |
|
692 |
Other financial liabilities |
247 |
|
237 |
Deferred tax |
263 |
|
553 |
Total liabilities |
6,762 |
|
7,620 |
|
|
|
|
Equity |
|
|
|
Capital |
3,423 |
|
3,405 |
Retained earnings |
9,280 |
|
8,680 |
Accumulated other comprehensive loss |
(1,087) |
|
(1,021) |
Total equity |
11,616 |
|
11,064 |
Total liabilities and equity |
|
|
|
Consolidated Statement of Cash Flow
(millions of (unaudited) |
|||||
|
|||||
|
Three Months Ended
|
|
Six Months Ended
|
||
|
2024 |
2023 |
|
2024 |
2023 |
Cash provided by (used in): |
|
|
|
|
|
Operating activities |
|
|
|
|
|
Earnings from continuing operations |
|
|
|
|
|
Adjustments for: |
|
|
|
|
|
Depreciation |
29 |
29 |
|
57 |
59 |
Amortization of computer software |
154 |
127 |
|
307 |
245 |
Amortization of other identifiable intangible assets |
23 |
23 |
|
48 |
48 |
Share of post-tax earnings in equity method investments |
(61) |
(419) |
|
(53) |
(989) |
Net losses (gains) on disposals of businesses and investments |
3 |
(348) |
|
4 |
(347) |
Deferred tax |
(545) |
9 |
|
(695) |
(118) |
Other |
70 |
146 |
|
117 |
277 |
Changes in working capital and other items |
189 |
240 |
|
46 |
160 |
Operating cash flows from continuing operations |
706 |
696 |
|
1,139 |
961 |
Operating cash flows from discontinued operations |
(1) |
(1) |
|
(2) |
1 |
Net cash provided by operating activities |
705 |
695 |
|
1,137 |
962 |
|
|
|
|
|
|
Investing activities |
|
|
|
|
|
Acquisitions, net of cash acquired |
(19) |
(33) |
|
(455) |
(523) |
Proceeds (payments) related to disposals of businesses and investments |
- |
418 |
|
(4) |
418 |
Proceeds from sales of LSEG shares |
610 |
1,583 |
|
1,854 |
3,876 |
Capital expenditures |
(152) |
(127) |
|
(297) |
(267) |
Other investing activities |
6 |
45 |
|
6 |
68 |
Taxes paid on sales of LSEG shares and disposals of businesses |
(121) |
(252) |
|
(137) |
(270) |
Investing cash flows from continuing operations |
324 |
1,634 |
|
967 |
3,302 |
Investing cash flows from discontinued operations |
- |
(1) |
|
- |
(1) |
Net cash provided by investing activities |
324 |
1,633 |
|
967 |
3,301 |
|
|
|
|
|
|
Financing activities |
|
|
|
|
|
Repayments of debt |
- |
- |
|
(48) |
- |
Net (repayments) borrowings under short-term loan facilities |
(703) |
1,132 |
|
(139) |
771 |
Payments of lease principal |
(16) |
(15) |
|
(31) |
(31) |
Payments for return of capital on common shares |
- |
(2,045) |
|
- |
(2,045) |
Repurchases of common shares |
(287) |
- |
|
(639) |
(718) |
Dividends paid on preference shares |
(2) |
(2) |
|
(3) |
(3) |
Dividends paid on common shares |
(235) |
(230) |
|
(472) |
(454) |
Purchase of non-controlling interests |
(4) |
- |
|
(384) |
- |
Other financing activities |
2 |
- |
|
1 |
5 |
Net cash used in financing activities |
(1,245) |
(1,160) |
|
(1,715) |
(2,475) |
Translation adjustments |
(3) |
- |
|
(5) |
1 |
(Decrease) increase in cash and cash equivalents |
(219) |
1,168 |
|
384 |
1,789 |
Cash and cash equivalents at beginning of period |
1,901 |
1,690 |
|
1,298 |
1,069 |
Cash and cash equivalents at end of period |
|
|
|
|
|
|
|||||||||
|
|||||||||
|
Three Months Ended |
|
Six Months Ended |
|
Year Ended |
||||
|
|
|
|
|
|||||
|
2024 |
2023 |
|
2024 |
2023 |
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from continuing operations |
|
|
|
|
|
|
|
|
|
Adjustments to remove: |
|
|
|
|
|
|
|
|
|
Tax (benefit) expense |
(402) |
219 |
|
(335) |
415 |
|
417 |
|
|
Other finance (income) costs |
(2) |
102 |
|
(24) |
192 |
|
192 |
|
|
Net interest expense |
36 |
34 |
|
76 |
89 |
|
152 |
|
|
Amortization of other identifiable intangible assets |
23 |
23 |
|
48 |
48 |
|
97 |
|
|
Amortization of computer software |
154 |
127 |
|
307 |
245 |
|
512 |
|
|
Depreciation |
29 |
29 |
|
57 |
59 |
|
116 |
|
|
EBITDA |
|
|
|
|
|
|
|
|
|
Adjustments to remove: |
|
|
|
|
|
|
|
|
|
Share of post-tax earnings in equity method investments |
(61) |
(419) |
|
(53) |
(989) |
|
(1,075) |
|
|
Other operating losses (gains), net |
29 |
(347) |
|
70 |
(364) |
|
(397) |
|
|
Fair value adjustments* |
(4) |
5 |
|
(2) |
18 |
|
18 |
|
|
Adjusted EBITDA(1) |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA margin(1) |
37.1 % |
40.1 % |
|
40.0 % |
39.4 % |
|
39.3 % |
|
|
|
|
|
|
|
|
|
|
|
|
* Fair value adjustments primarily represent gains or losses on intercompany balances that arise in the ordinary course of business due to changes in foreign currency exchange rates, which are a component of operating expenses, as well as adjustments related to acquired deferred revenue. |
|
|||||||
Reconciliation of Net Cash Provided By Operating Activities to Free Cash Flow(1) |
|||||||
(millions of |
|||||||
(unaudited) |
|||||||
|
|
|
|||||
|
Three Months Ended |
|
Six Months Ended |
|
Year Ended |
||
|
|
|
|
|
|||
|
2024 |
2023 |
|
2024 |
2023 |
|
2023 |
Net cash provided by operating activities |
|
|
|
|
|
|
|
Capital expenditures |
(152) |
(127) |
|
(297) |
(267) |
|
(544) |
Other investing activities |
6 |
45 |
|
6 |
68 |
|
137 |
Payments of lease principal |
(16) |
(15) |
|
(31) |
(31) |
|
(58) |
Dividends paid on preference shares |
(2) |
(2) |
|
(3) |
(3) |
|
(5) |
Free cash flow(1) |
|
|
|
|
|
|
|
|
|||||
Reconciliation of Capital Expenditures to Accrued Capital Expenditures (1) |
|||||
(millions of |
|||||
(unaudited) |
|||||
|
|
|
Year Ended |
||
|
|
|
|||
|
|
|
|
2023 |
|
Capital expenditures |
|
|
|
|
|
Remove: IFRS adjustment to cash basis |
|
|
|
(12) |
|
Accrued capital expenditures (1) |
|
|
|
|
|
Accrued capital expenditures as a percentage of revenues(1) |
|
|
|
7.8 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Refer to page 22 for additional information on non-IFRS financial measures. |
|
|||||||
Reconciliation of Net Earnings to Adjusted Earnings(1) |
|||||||
Reconciliation of Total Change in Adjusted EPS to Change in Constant Currency(1) |
|||||||
(millions of |
|||||||
(unaudited) |
|||||||
|
|||||||
|
Three Months Ended
|
Six Months Ended
|
Year Ended |
||||
|
|
||||||
|
2024 |
2023 |
|
2024 |
2023 |
|
2023 |
Net earnings |
|
|
|
|
|
|
|
Adjustments to remove: |
|
|
|
|
|
|
|
Fair value adjustments* |
(4) |
5 |
|
(2) |
18 |
|
18 |
Amortization of acquired computer software |
37 |
20 |
|
75 |
27 |
|
72 |
Amortization of other identifiable intangible assets |
23 |
23 |
|
48 |
48 |
|
97 |
Other operating losses (gains), net |
29 |
(347) |
|
70 |
(364) |
|
(397) |
Interest benefit impacting comparability(2) |
- |
- |
|
- |
- |
|
(12) |
Other finance (income) costs |
(2) |
102 |
|
(24) |
192 |
|
192 |
Share of post-tax earnings in equity method investments |
(61) |
(419) |
|
(53) |
(989) |
|
(1,075) |
Tax on above items(1) |
(8) |
148 |
|
(40) |
258 |
|
265 |
Tax items impacting comparability(1) (2) |
(470) |
(2) |
|
(481) |
(2) |
|
(172) |
Loss (earnings) from discontinued operations, net of tax |
3 |
(5) |
|
(11) |
(24) |
|
(49) |
Interim period effective tax rate normalization(1) |
(1) |
(5) |
|
(10) |
(3) |
|
- |
Dividends declared on preference shares |
(2) |
(2) |
|
(3) |
(3) |
|
(5) |
Adjusted earnings(1) (3) |
|
|
|
|
|
|
|
Adjusted EPS(1) (3) |
|
|
|
|
|
|
|
Total change |
-3 % |
|
|
15 % |
|
|
|
Foreign currency |
1 % |
|
|
1 % |
|
|
|
Constant currency |
-5 % |
|
|
15 % |
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted-average common shares (millions) |
450.9 |
470.4 |
|
451.9 |
472.5 |
|
|
Reconciliation of Effective Tax Rate on Adjusted Earnings(1) |
Year-ended |
|
2023 |
Adjusted earnings |
|
Plus: Dividends declared on preference shares |
5 |
Plus: Tax expense on adjusted earnings |
324 |
Pre-tax adjusted earnings |
|
|
|
IFRS Tax expense |
|
Remove tax related to: |
|
Amortization of acquired computer software |
17 |
Amortization of other identifiable intangible assets |
22 |
Share of post-tax earnings in equity method investments |
(253) |
Other finance costs |
31 |
Other operating gains, net |
(81) |
Other items |
(1) |
Subtotal – Remove tax expense on pre-tax items removed from adjusted earnings |
(265) |
Remove: Tax items impacting comparability |
172 |
Total - Remove all items impacting comparability |
(93) |
Tax expense on adjusted earnings |
|
Effective tax rate on adjusted earnings |
16.5 % |
|
*Fair value adjustments primarily represent gains or losses on intercompany balances that arise in the ordinary course of business due to changes in foreign currency exchange rates, which are a component of operating expenses, as well as adjustments related to acquired deferred revenue. |
|
(1) Refer to page 22 for additional information on non-IFRS financial measures. |
(2) The year ended |
(3) The adjusted earnings impact of non-controlling interests, which was applicable only to the six months ended |
|
||||||||||||||||||
Reconciliation of Changes in Revenues to Changes in Revenues on a Constant Currency(1) and Organic Basis (1) |
||||||||||||||||||
(millions of |
||||||||||||||||||
(unaudited) |
||||||||||||||||||
|
|
|||||||||||||||||
|
|
Three Months Ended |
|
|
|
|
|
|
||||||||||
|
|
|
|
Change |
||||||||||||||
|
|
2024 |
2023 |
|
Total |
Foreign |
SUBTOTAL |
Net
Acquisitions/ |
Organic |
|
||||||||
Total Revenues |
|
|
|
|
|
|
|
|
|
|
||||||||
Legal Professionals |
|
|
|
|
3 % |
0 % |
3 % |
-4 % |
7 % |
|
||||||||
Corporates |
|
442 |
392 |
|
13 % |
0 % |
13 % |
5 % |
8 % |
|
||||||||
Tax & Accounting Professionals |
|
250 |
229 |
|
9 % |
-3 % |
12 % |
1 % |
10 % |
|
||||||||
"Big 3" Segments Combined(1) |
|
1,419 |
1,326 |
|
7 % |
-1 % |
8 % |
-1 % |
8 % |
|
||||||||
|
|
205 |
194 |
|
6 % |
-1 % |
7 % |
3 % |
4 % |
|
||||||||
Global Print |
|
123 |
133 |
|
-8 % |
-1 % |
-7 % |
0 % |
-7 % |
|
||||||||
Eliminations/Rounding |
|
(7) |
(6) |
|
|
|
|
|
|
|
||||||||
Revenues |
|
|
|
|
6 % |
-1 % |
6 % |
0 % |
6 % |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Recurring Revenues |
|
|
|
|
|
|
|
|
|
|
||||||||
Legal Professionals |
|
|
|
|
5 % |
0 % |
5 % |
-2 % |
8 % |
|
||||||||
Corporates |
|
382 |
340 |
|
12 % |
0 % |
13 % |
3 % |
10 % |
|
||||||||
Tax & Accounting Professionals |
|
179 |
167 |
|
7 % |
-3 % |
10 % |
0 % |
10 % |
|
||||||||
"Big 3" Segments Combined(1) |
|
1,263 |
1,174 |
|
7 % |
-1 % |
8 % |
0 % |
9 % |
|
||||||||
|
|
164 |
155 |
|
6 % |
-1 % |
7 % |
3 % |
4 % |
|
||||||||
Eliminations/Rounding |
|
(7) |
(6) |
|
|
|
|
|
|
|
||||||||
Total Recurring Revenues |
|
|
|
|
7 % |
-1 % |
8 % |
0 % |
8 % |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Transactions Revenues |
|
|
|
|
|
|
|
|
|
|
||||||||
Legal Professionals |
|
|
|
|
-34 % |
0 % |
-33 % |
-36 % |
3 % |
|
||||||||
Corporates |
|
60 |
52 |
|
16 % |
-1 % |
17 % |
16 % |
1 % |
|
||||||||
Tax & Accounting Professionals |
|
71 |
62 |
|
15 % |
-1 % |
16 % |
5 % |
11 % |
|
||||||||
"Big 3" Segments Combined(1) |
|
156 |
152 |
|
3 % |
-1 % |
4 % |
-2 % |
5 % |
|
||||||||
|
|
41 |
39 |
|
6 % |
-1 % |
7 % |
4 % |
2 % |
|
||||||||
Total Transactions Revenues |
|
|
|
|
4 % |
-1 % |
4 % |
0 % |
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. |
|
||||||||||||||||||
Reconciliation of Changes in Revenues to Changes in Revenues on a Constant Currency(1) and Organic Basis (1) |
||||||||||||||||||
(millions of |
||||||||||||||||||
(unaudited) |
||||||||||||||||||
|
|
|||||||||||||||||
|
|
Six Months Ended |
|
|
|
|
|
|
||||||||||
|
|
|
|
Change |
||||||||||||||
|
|
2024 |
2023 |
|
Total |
Foreign |
SUBTOTAL |
Net
Acquisitions/ |
Organic |
|
||||||||
Total Revenues |
|
|
|
|
|
|
|
|
|
|
||||||||
Legal Professionals |
|
|
|
|
2 % |
0 % |
2 % |
-5 % |
7 % |
|
||||||||
Corporates |
|
949 |
827 |
|
15 % |
0 % |
15 % |
5 % |
10 % |
|
||||||||
Tax & Accounting Professionals |
|
578 |
511 |
|
13 % |
-2 % |
15 % |
2 % |
12 % |
|
||||||||
"Big 3" Segments Combined(1) |
|
2,975 |
2,757 |
|
8 % |
0 % |
8 % |
-1 % |
9 % |
|
||||||||
|
|
415 |
369 |
|
13 % |
-1 % |
13 % |
3 % |
10 % |
|
||||||||
Global Print |
|
247 |
271 |
|
-9 % |
0 % |
-9 % |
0 % |
-9 % |
|
||||||||
Eliminations/Rounding |
|
(12) |
(12) |
|
|
|
|
|
|
|
||||||||
Revenues |
|
|
|
|
7 % |
0 % |
7 % |
0 % |
8 % |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Recurring Revenues |
|
|
|
|
|
|
|
|
|
|
||||||||
Legal Professionals |
|
|
|
|
5 % |
0 % |
5 % |
-3 % |
8 % |
|
||||||||
Corporates |
|
752 |
666 |
|
13 % |
0 % |
13 % |
3 % |
10 % |
|
||||||||
Tax & Accounting Professionals |
|
378 |
343 |
|
10 % |
-2 % |
12 % |
0 % |
12 % |
|
||||||||
"Big 3" Segments Combined(1) |
|
2,530 |
2,348 |
|
8 % |
0 % |
8 % |
-1 % |
9 % |
|
||||||||
|
|
328 |
310 |
|
6 % |
-1 % |
7 % |
3 % |
4 % |
|
||||||||
Eliminations/Rounding |
|
(12) |
(12) |
|
|
|
|
|
|
|
||||||||
Total Recurring Revenues |
|
|
|
|
8 % |
0 % |
8 % |
-1 % |
8 % |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Transactions Revenues |
|
|
|
|
|
|
|
|
|
|
||||||||
Legal Professionals |
|
|
|
|
-40 % |
-1 % |
-39 % |
-43 % |
3 % |
|
||||||||
Corporates |
|
197 |
161 |
|
23 % |
0 % |
23 % |
12 % |
11 % |
|
||||||||
Tax & Accounting Professionals |
|
200 |
168 |
|
19 % |
-1 % |
20 % |
7 % |
13 % |
|
||||||||
"Big 3" Segments Combined(1) |
|
445 |
409 |
|
9 % |
-1 % |
10 % |
-1 % |
11 % |
|
||||||||
|
|
87 |
59 |
|
48 % |
-1 % |
49 % |
8 % |
41 % |
|
||||||||
Total Transactions Revenues |
|
|
|
|
14 % |
-1 % |
15 % |
0 % |
15 % |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
|
|
|
|
|
|||||||||
|
|
|
|
Change |
|||||||||||||
|
|
2023 |
2022 |
|
Total |
Foreign |
SUBTOTAL |
Net
Acquisitions/ |
Organic |
|
|||||||
Total Revenues |
|
|
|
|
|
|
|
|
|
|
|||||||
Legal Professionals |
|
|
|
|
0 % |
0 % |
0 % |
-6 % |
6 % |
|
|||||||
Corporates |
|
1,620 |
1,536 |
|
5 % |
0 % |
5 % |
-2 % |
7 % |
|
|||||||
Tax & Accounting Professionals |
|
1,058 |
986 |
|
7 % |
-2 % |
9 % |
-1 % |
10 % |
|
|||||||
"Big 3" Segments Combined(1) |
|
5,485 |
5,325 |
|
3 % |
0 % |
4 % |
-4 % |
7 % |
|
|||||||
|
|
769 |
733 |
|
5 % |
0 % |
5 % |
1 % |
4 % |
|
|||||||
Global Print |
|
562 |
592 |
|
-5 % |
-1 % |
-4 % |
-1 % |
-3 % |
|
|||||||
Eliminations/Rounding |
|
(22) |
(23) |
|
|
|
|
|
|
|
|||||||
Revenues |
|
|
|
|
3 % |
0 % |
3 % |
-3 % |
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. |
|
|||||||||
Reconciliation of Changes in Adjusted EBITDA(1) and Related Margin(1) to Changes on a Constant Currency Basis(1) |
|||||||||
(millions of |
|||||||||
(unaudited) |
|||||||||
|
|
||||||||
|
|
Three Months Ended |
|
|
|||||
|
|
|
|
Change |
|
||||
|
|
2024 |
2023 |
|
Total |
Foreign Currency |
Constant Currency |
|
|
Adjusted EBITDA (1) |
|
|
|
|
|
|
|
|
|
Legal Professionals |
|
|
|
|
-5 % |
1 % |
-6 % |
|
|
Corporates |
|
163 |
163 |
|
0 % |
0 % |
0 % |
|
|
Tax & Accounting Professionals |
|
91 |
89 |
|
3 % |
-2 % |
5 % |
|
|
"Big 3" Segments Combined(1) |
|
581 |
597 |
|
-3 % |
0 % |
-3 % |
|
|
|
|
51 |
45 |
|
13 % |
0 % |
14 % |
|
|
Global Print |
|
43 |
53 |
|
-18 % |
0 % |
-18 % |
|
|
Corporate costs |
|
(29) |
(33) |
|
n/a |
n/a |
n/a |
|
|
Adjusted EBITDA |
|
|
|
|
-2 % |
0 % |
-2 % |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin (1) |
|
|
|
|
|
|
|
|
|
Legal Professionals |
|
45.0 % |
48.9 % |
|
-390bp |
50bp |
-440bp |
|
|
Corporates |
|
36.8 % |
41.6 % |
|
-480bp |
20bp |
-500bp |
|
|
Tax & Accounting Professionals |
|
36.8 % |
38.5 % |
|
-170bp |
20bp |
-190bp |
|
|
"Big 3" Segments Combined(1) |
|
41.0 % |
44.9 % |
|
-390bp |
40bp |
-430bp |
|
|
|
|
24.8 % |
23.1 % |
|
170bp |
30bp |
140bp |
|
|
Global Print |
|
35.2 % |
39.7 % |
|
-450bp |
0bp |
-450bp |
|
|
Adjusted EBITDA margin |
|
37.1 % |
40.1 % |
|
-300bp |
30bp |
-330bp |
|
|
|||||||||
Reconciliation of Changes in Adjusted EBITDA(1) and Related Margin(1) to Changes on a Constant Currency Basis(1) |
|||||||||
(millions of |
|||||||||
(unaudited) |
|||||||||
|
|
||||||||
|
|
Six Months Ended |
|
|
|||||
|
|
|
|
Change |
|
||||
|
|
2024 |
2023 |
|
Total |
Foreign Currency |
Constant Currency |
|
|
Adjusted EBITDA (1) |
|
|
|
|
|
|
|
|
|
Legal Professionals |
|
|
|
|
1 % |
0 % |
1 % |
|
|
Corporates |
|
356 |
317 |
|
12 % |
1 % |
12 % |
|
|
Tax & Accounting Professionals |
|
272 |
238 |
|
14 % |
-1 % |
16 % |
|
|
"Big 3" Segments Combined(1) |
|
1,297 |
1,218 |
|
7 % |
0 % |
7 % |
|
|
|
|
111 |
74 |
|
50 % |
-2 % |
51 % |
|
|
Global Print |
|
90 |
103 |
|
-12 % |
0 % |
-12 % |
|
|
Corporate costs |
|
(46) |
(56) |
|
n/a |
n/a |
n/a |
|
|
Adjusted EBITDA |
|
|
|
|
8 % |
0 % |
8 % |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin (1) |
|
|
|
|
|
|
|
|
|
Legal Professionals |
|
46.2 % |
46.7 % |
|
-50bp |
10bp |
-60bp |
|
|
Corporates |
|
37.3 % |
38.2 % |
|
-90bp |
10bp |
-100bp |
|
|
Tax & Accounting Professionals |
|
47.1 % |
45.7 % |
|
140bp |
0bp |
140bp |
|
|
"Big 3" Segments Combined(1) |
|
43.5 % |
44.0 % |
|
-50bp |
0bp |
-50bp |
|
|
|
|
26.6 % |
20.0 % |
|
660bp |
0bp |
660bp |
|
|
Global Print |
|
36.7 % |
38.1 % |
|
-140bp |
10bp |
-150bp |
|
|
Adjusted EBITDA margin |
|
40.0 % |
39.4 % |
|
60bp |
20bp |
40bp |
|
|
n/a: not applicable |
|
Growth percentages and margins are computed using whole dollars. As a result, percentages and margins calculated from reported amounts may differ from those presented, and growth components may not total due to rounding. |
|
(1) Refer to page 22 for additional information on non-IFRS financial measures. |
Reconciliation of adjusted EBITDA margin(1)
To compute segment and consolidated adjusted EBITDA margin, we exclude fair value adjustments related to acquired deferred revenue from our IFRS revenues. The chart below reconciles IFRS revenues to revenues used in the calculation of adjusted EBITDA margin, which excludes fair value adjustments related to acquired deferred revenue.
Three months ended |
||||||
|
IFRS revenues |
Remove fair value |
Revenues excluding |
Adjusted EBITDA |
Adjusted EBITDA |
|
Legal Professionals |
|
- |
|
|
45.0 % |
|
Corporates |
442 |
|
444 |
163 |
36.8 % |
|
Tax & Accounting Professionals |
250 |
- |
250 |
91 |
36.8 % |
|
"Big 3" Segments Combined |
1,419 |
2 |
1,421 |
581 |
41.0 % |
|
|
205 |
- |
205 |
51 |
24.8 % |
|
Global Print |
123 |
- |
123 |
43 |
35.2 % |
|
Eliminations/ Rounding |
(7) |
- |
(7) |
- |
n/a |
|
Corporate costs |
- |
- |
- |
(29) |
n/a |
|
Consolidated totals |
|
|
|
|
37.1 % |
|
Six months ended |
||||||
|
IFRS revenues |
Remove fair value |
Revenues excluding |
Adjusted EBITDA |
Adjusted EBITDA |
|
Legal Professionals |
|
- |
|
|
46.2 % |
|
Corporates |
949 |
|
954 |
356 |
37.3 % |
|
Tax & Accounting Professionals |
578 |
- |
578 |
272 |
47.1 % |
|
"Big 3" Segments Combined |
2,975 |
5 |
2,980 |
1,297 |
43.5 % |
|
|
415 |
1 |
416 |
111 |
26.6 % |
|
Global Print |
247 |
- |
247 |
90 |
36.7 % |
|
Eliminations/ Rounding |
(12) |
- |
(12) |
- |
n/a |
|
Corporate costs |
- |
- |
- |
(46) |
n/a |
|
Consolidated totals |
|
|
|
|
40.0 % |
|
Three months ended |
||||||
|
IFRS revenues |
Remove fair value |
Revenues excluding |
Adjusted EBITDA |
Adjusted EBITDA |
|
Legal Professionals |
|
- |
|
|
48.9 % |
|
Corporates |
392 |
|
393 |
163 |
41.6 % |
|
Tax & Accounting Professionals |
229 |
3 |
232 |
89 |
38.5 % |
|
"Big 3" Segments Combined |
1,326 |
4 |
1,330 |
597 |
44.9 % |
|
|
194 |
- |
194 |
45 |
23.1 % |
|
Global Print |
133 |
- |
133 |
53 |
39.7 % |
|
Eliminations/ Rounding |
(6) |
- |
(6) |
- |
n/a |
|
Corporate costs |
- |
- |
- |
(33) |
n/a |
|
Consolidated totals |
|
|
|
|
40.1 % |
|
|
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 22 for additional information on non-IFRS financial measures. |
Reconciliation of adjusted EBITDA margin(1)
Six months ended |
||||||
|
IFRS revenues |
Remove fair value |
Revenues excluding |
Adjusted EBITDA |
Adjusted EBITDA |
|
Legal Professionals |
|
- |
|
|
46.7 % |
|
Corporates |
827 |
|
830 |
317 |
38.2 % |
|
Tax & Accounting Professionals |
511 |
10 |
521 |
238 |
45.7 % |
|
"Big 3" Segments Combined |
2,757 |
13 |
2,770 |
1,218 |
44.0 % |
|
|
369 |
- |
369 |
74 |
20.0 % |
|
Global Print |
271 |
- |
271 |
103 |
38.1 % |
|
Eliminations/ Rounding |
(12) |
- |
(12) |
- |
n/a |
|
Corporate costs |
- |
- |
- |
(56) |
n/a |
|
Consolidated totals |
|
|
|
|
39.4 % |
|
|
|
||||||
"Big 3" Segments and Consolidated Adjusted EBITDA(1) and the Related Margins(1) |
|
||||||
(millions of |
|
||||||
(unaudited) |
|
||||||
|
|
|
|||||
|
|
Year Ended |
|
|
|||
|
|
2023 |
|
|
|||
|
|
|
2023 |
|
|
||
Adjusted EBITDA (1) |
|
|
|
|
|
||
Legal Professionals |
|
|
|
|
|
||
Corporates |
|
|
619 |
|
|
||
Tax & Accounting Professionals |
|
|
490 |
|
|
||
"Big 3" Segments Combined(1) |
|
|
2,408 |
|
|
||
|
|
|
172 |
|
|
||
Global Print |
|
|
213 |
|
|
||
Corporate costs |
|
|
(115) |
|
|
||
Adjusted EBITDA |
|
|
|
|
|
||
|
|
|
|
|
|
||
"Big 3" Segments Combined (1) |
|
|
|
|
|
||
Adjusted EBITDA |
|
|
|
|
|
||
Revenues, excluding |
|
|
|
|
|
||
Adjusted EBITDA margin |
|
|
43.8 % |
|
|
||
|
|
|
|
|
|
||
Consolidated (1) |
|
|
|
|
|
||
Adjusted EBITDA |
|
|
|
|
|
||
Revenues, excluding |
|
|
|
|
|
||
Adjusted EBITDA margin |
|
|
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. |
|
(1) Refer to page 22 for additional information on non-IFRS financial measures. |
Non-IFRS Financial Measures |
Definition |
Why Useful to the Company and Investors |
Adjusted EBITDA and the related margin |
Represents earnings or losses from continuing operations before tax expense or benefit, net interest expense, other finance costs or income, depreciation, amortization of 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 our computation of adjusted earnings.
The post-tax amount of each item is excluded from adjusted earnings based on the specific tax rules and tax rates associated with the nature and jurisdiction of each item.
Adjusted EPS is calculated from adjusted earnings using diluted weighted-average shares and does not represent actual earnings or loss per share attributable to shareholders.
|
Provides a more comparable basis to analyze earnings.
These measures are commonly used by shareholders to measure performance.
|
Effective tax rate on adjusted earnings |
Adjusted tax expense divided by pre-tax adjusted earnings. Adjusted tax expense is computed as income tax (benefit) expense plus or minus the income tax impacts of all items impacting adjusted earnings (as described above), and other tax items impacting comparability.
In interim periods, we also make an adjustment to reflect income taxes based on the estimated full-year effective tax rate. Earnings or losses for interim periods under IFRS reflect income taxes based on the estimated effective tax rates of each of the jurisdictions in which Thomson Reuters operates. The non-IFRS adjustment reallocates estimated full-year income taxes between interim periods but has no effect on full-year income taxes. |
Provides a basis to analyze the effective tax rate associated with adjusted earnings.
Because the geographical mix of pre-tax profits and losses in interim periods may be different from that for the full year, our effective tax rate computed in accordance with IFRS may be more volatile by quarter. Therefore, we believe that using the expected full-year effective tax rate provides more comparability among interim periods. |
Free cash flow |
Net cash provided by operating activities and other investing activities, less capital expenditures, payments of lease principal and dividends paid on the company's preference shares.
|
Helps assess the company's ability, over the long term, to create value for its shareholders as it represents cash available to repay debt, pay common dividends and fund share repurchases and acquisitions.
|
Changes before the impact of foreign currency or at "constant currency" |
The changes in revenues, adjusted EBITDA and the related margin, and adjusted EPS before currency (at constant currency or excluding the effects of currency) are determined by converting the current and equivalent prior period's local currency results using the same foreign currency exchange rate.
|
Provides better comparability of business trends from period to period. |
Changes in revenues computed on an "organic" basis |
Represent changes in revenues of the company's existing businesses at constant currency. The metric excludes the distortive impacts of acquisitions and dispositions from not owning the business in both comparable periods.
|
Provides further insight into the performance of the company's existing businesses by excluding distortive impacts and serves as a better measure of the company's ability to grow its business over the long term.
|
Accrued capital expenditures as a percentage of revenues |
Accrued capital expenditures divided by revenues, where accrued capital expenditures include amounts that remain unpaid at the end of the reporting period. For purposes of this calculation, revenues are before fair value adjustments to acquired deferred revenue.
|
Reflects the basis on which the company manages capital expenditures for internal budgeting purposes.
|
"Big 3" segments |
The company's combined Legal Professionals, Corporates and Tax & Accounting Professionals segments. All measures reported for the "Big 3" segments are non-IFRS financial measures.
|
The "Big 3" segments comprised approximately 80% of revenues and represent the core of the company's business information service product offerings. |
Please refer to reconciliations for the most directly comparable IFRS financial measures.
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SOURCE Thomson Reuters