6-K
Thomson Reuters Corp /Can/ (TRI)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OFFOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
| For the month of August 2024 | Commission File Number: 1-31349 |
|---|
THOMSON REUTERS CORPORATION
(Translation of registrant’s name into English)
19 DuncanStreet, Toronto,
Ontario M5H 3H1, Canada
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☐ Form 40-F ☒
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| THOMSON REUTERS CORPORATION | |
|---|---|
| (Registrant) | |
| By: | /s/ Jennifer Ruddick |
| Name: Jennifer Ruddick | |
| Title: Deputy Company Secretary |
Date: August 1, 2024
EXHIBIT INDEX
| Exhibit Number | Description |
|---|---|
| 99.1 | News release dated August 1, 2024 – Thomson Reuters Reports Second-Quarter 2024 Results |
EXHIBIT 99.1 - EARNINGS RELEASE
Exhibit 99.1
Thomson Reuters Reports Second-Quarter 2024 Results
TORONTO, August 1, 2024 – Thomson Reuters (TSX/NYSE: TRI) today reported results for the second quarter ended June 30, 2024:
| • | Good revenue momentum continued in the second quarter |
|---|---|
| o | Total company and organic revenues both up 6% |
| --- | --- |
| • | Organic revenues up 8% for the “Big 3” segments (Legal Professionals, Corporates and Tax & Accounting<br>Professionals) |
| --- | --- |
| • | Based on Q2 performance, raised full-year 2024 outlook for total and organic revenue growth to the high end of the prior<br>ranges |
| --- | --- |
| • | Completed monetization of interest in London Stock Exchange Group (LSEG) in the second quarter |
| --- | --- |
| • | Completed $1.0 billion share buyback program |
| --- | --- |
| o | Repurchased $287 million of the company’s common shares in the second quarter |
| --- | --- |
“Good momentum continued across our portfolio in the second quarter, leading to a moderately raised revenue outlook,” said Steve Hasker, President and CEO of Thomson Reuters. “Our 2024 investment plans remain on track as we execute against the ambitious product roadmap we detailed at our March investor day, exemplified by the July launches of CoCounsel Drafting and Checkpoint Edge with CoCounsel. We believe we are well positioned to help our customers navigate rising regulatory compliance, in addition to harnessing the potential of Generative AI”.
Mr. Hasker added, “As we look ahead, we are committed to taking a balanced capital allocation approach, focusing on delivering sustained value creation through a long-term investment strategy”.
Consolidated Financial Highlights—Three Months Ended June 30
| Three MonthsEnded June 30,<br> <br>(Millions of U.S. dollars, except for adjusted EBITDA margin and EPS)<br><br><br>(unaudited) | **** | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | Change | Change atConstantCurrency | |||||||||
| IFRS Financial Measures^(1)^ | ||||||||||||
| Revenues | $ | 1,740 | $ | 1,647 | 6 | % | ||||||
| Operating profit | $ | 415 | $ | 825 | -50 | % | ||||||
| Diluted earnings per share (EPS) | $ | 1.86 | $ | 1.90 | -2 | % | ||||||
| Net cash provided by operating activities | $ | 705 | $ | 695 | 2 | % | ||||||
| Non-IFRS FinancialMeasures^(1)^ | ||||||||||||
| Revenues | $ | 1,740 | $ | 1,647 | 6 | % | 6 | % | ||||
| Adjusted EBITDA | $ | 646 | $ | 662 | -2 | % | -2 | % | ||||
| Adjusted EBITDA margin | 37.1 | % | 40.1 | % | -300bp | -330bp | ||||||
| Adjusted EPS | $ | 0.85 | $ | 0.88 | ^(2)^ | -3 | % | -5 | % | |||
| Free cash flow | $ | 541 | $ | 596 | -9 | % | ||||||
| (1) In addition to results reported in accordance with International Financial Reporting Standards (IFRS), thecompany uses certain non-IFRS financial measures as supplemental indicators of its operating performance and financial position. See the “Non-IFRS FinancialMeasures” 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 directlycomparable IFRS measures.<br> <br>(2) As of September 2023, we amended our definition of adjusted earnings toexclude amortization from acquired computer software. The comparative 2023 period has been revised to reflect the current period presentation. For additional information, see the “Non-IFRS FinancialMeasures” section of this news release. |
Thomson Reuters Reports Second-Quarter 2024 Results
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Revenues increased 6%, driven by growth in recurring and transactions revenues. Foreign currency had no impact on revenue growth.
| o | Organic revenues increased 6%, driven by 8% growth in recurring revenues (82% of total revenues) and 5% growth in<br>transactions revenues. Global Print revenues decreased 7% organically. |
|---|---|
| o | The company’s “Big 3” segments reported organic revenue growth of 8% and collectively comprised 82% of<br>total revenues. |
| --- | --- |
Operating profit decreased 50% primarily because the 2023 period included a $347 million gain on the sale of a majority stake in the company’s Elite business.
| o | Adjusted EBITDA, which excludes the gain on sale of Elite, as well as other items, decreased 2% as higher revenues were<br>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.<br> |
|---|
Diluted EPS decreased to $1.86 compared to $1.90 in the prior-year period. The current period reflected lower operating profit and included a $468 million non-cash tax benefit related to tax legislation enacted in Canada. The prior-year period included a significant increase in the value of the company’s investment in LSEG. In 2024, diluted EPS also benefited from a reduction in weighted-average common shares outstanding due to share repurchases and the company’s June 2023 return of capital transaction.
| o | Adjusted EPS, which excludes the gain on sale of Elite, the changes in value of the company’s LSEG<br>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<br>amortization and higher taxes more than offset a benefit from a reduction in weighted-average common shares. |
|---|
Net cash provided by operatingactivities increased by $10 million in the second quarter, despite a reduced working capital benefit compared to the prior year.
| o | Free cash flow decreased $55 million as the increase in cash flow from operating activities was more than<br>offset by higher capital expenditures and lower cash flows from other investing activities. |
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Thomson Reuters Reports Second-Quarter 2024 Results
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Highlights by Customer Segment—Three Months Ended June 30
| (Millions of U.S.dollars, except for adjusted EBITDA margins)<br> <br>(unaudited) | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Three Months Ended | |||||||||||||||
| June 30, | Change | ||||||||||||||
| 2024 | 2023 | Total | ConstantCurrency^(1)^ | Organic^(1)(2)^ | |||||||||||
| Revenues | |||||||||||||||
| Legal Professionals | $ | 727 | $ | 705 | 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 | % | |||||||
| Reuters News | 205 | 194 | 6 | % | 7 | % | 4 | % | |||||||
| Global Print | 123 | 133 | -8 | % | -7 | % | -7 | % | |||||||
| Eliminations/Rounding | (7 | ) | (6 | ) | |||||||||||
| Revenues | $ | 1,740 | **** | $ | 1,647 | **** | **** | 6 | % | **** | 6 | % | **** | 6 | % |
| Adjusted EBITDA^(1)^ | |||||||||||||||
| Legal Professionals | $ | 327 | $ | 345 | -5 | % | -6 | % | |||||||
| Corporates | 163 | 163 | 0 | % | 0 | % | |||||||||
| Tax & Accounting Professionals | 91 | 89 | 3 | % | 5 | % | |||||||||
| “Big 3” Segments Combined^(1)^ | 581 | 597 | -3 | % | -3 | % | |||||||||
| Reuters News | 51 | 45 | 13 | % | 14 | % | |||||||||
| Global Print | 43 | 53 | -18 | % | -18 | % | |||||||||
| Corporate costs | (29 | ) | (33 | ) | n/a | n/a | |||||||||
| Adjusted EBITDA | $ | 646 | **** | $ | 662 | **** | **** | -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 | |||||||||
| Reuters News | 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 thetables appended to this news release for additional information on these and other non-IFRS financial measures. To compute segment and consolidated adjusted EBITDA margin, the company excludes fair valueadjustments related to acquired deferred revenue.<br> <br>(2) Computed for revenue growth only.<br><br><br>n/a: not applicable |
Unless otherwise noted, all revenue growth comparisons by customer segment in this news release are atconstant currency (or exclude the impact of foreign currency) as Thomson Reuters believes this provides the best basis to measure their performance.
Thomson Reuters Reports Second-Quarter 2024 Results
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Legal Professionals
Revenues increased 3% to $727 million and included a negative impact from net divestitures. Organic revenue growth was 7%.
| o | Recurring revenues increased 5% (97% of total, 8% organic). Organic growth was primarily driven by Westlaw, Practical<br>Law, CoCounsel and the segment’s international businesses. |
|---|---|
| o | Transactions revenues decreased 33% (3% of total, increased 3% organic). |
| --- | --- |
Adjusted EBITDA decreased 5% to $327 million.
| o | The margin decreased to 45.0% from 48.9% primarily driven by higher investments and the Casetext acquisition.<br> |
|---|
Corporates
Revenues increased 13% to $442 million, including the acquisition impact of Pagero. Organic revenues increased 8%.
| o | Recurring revenues increased 13% (86% of total, 10% organic). Organic growth was primarily driven by Practical Law,<br>Indirect Tax, Clear and Pagero. |
|---|---|
| o | Transactions revenues increased 17% (14% of total, 1% organic) driven primarily by Pagero and the segment’s<br>international businesses. |
| --- | --- |
Adjusted EBITDA was unchanged at $163 million.
| o | The margin decreased to 36.8% from 41.6%, driven by the Pagero acquisition and higher investments. |
|---|
Tax & Accounting Professionals
Revenues increased 12% to $250 million. Organic revenues increased 10%.
| o | Recurring revenues increased 10% (72% of total, all organic). Organic growth was driven by the segment’s Latin<br>America business and audit products. |
|---|---|
| o | Transactions revenues increased 16% (28% of total, 11% organic) primarily due to SurePrep and Confirmation.<br> |
| --- | --- |
Adjusted EBITDA increased 3% to $91 million.
| o | 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.
Thomson Reuters Reports Second-Quarter 2024 Results
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Reuters News
Revenues of $205 million increased 7% (4% organic) driven primarily by growth in the agency business and by a contractual price increase from our news agreement with the Data & Analytics business of LSEG.
Adjusted EBITDA increased 13% to $51 million driven by higher revenues.
Global Print
Revenues of $123 million decreased 7%, all organic, impacted in part by the migration of customers from a Global Print product to Westlaw.
Adjusted EBITDA decreased 18% to $43 million.
| o | The margin decreased to 35.2% from 39.7% due to lower revenues. |
|---|
Corporate Costs
Corporate costs were $29 million, compared to $33 million in the prior-year period.
Consolidated Financial Highlights—Six Months Ended June 30
| Six Months EndedJune 30,<br> <br>(Millions of U.S. dollars, except for adjusted EBITDA margin and EPS)<br><br><br>(unaudited) | **** | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | Change | Change atConstantCurrency | |||||||||
| IFRS Financial Measures^(1)^ | ||||||||||||
| Revenues | $ | 3,625 | $ | 3,385 | 7 | % | ||||||
| Operating profit | $ | 972 | $ | 1,333 | -27 | % | ||||||
| Diluted EPS | $ | 2.92 | $ | 3.49 | -16 | % | ||||||
| Net cash provided by operating activities | $ | 1,137 | $ | 962 | 18 | % | ||||||
| Non-IFRS FinancialMeasures^(1)^ | ||||||||||||
| Revenues | $ | 3,625 | $ | 3,385 | 7 | % | 7 | % | ||||
| Adjusted EBITDA | $ | 1,452 | $ | 1,339 | 8 | % | 8 | % | ||||
| Adjusted EBITDA margin | 40.0 | % | 39.4 | % | 60bp | 40bp | ||||||
| Adjusted EPS | $ | 1.97 | $ | 1.71 | ^(2)^ | 15 | % | 15 | % | |||
| Free cash flow | $ | 812 | $ | 729 | 11 | % | ||||||
| (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 thetables 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 IFRSmeasures.<br> <br>(2) As of September 2023, we amended our definition of adjusted earnings to excludeamortization from acquired computer software. The comparative 2023 period has been revised to reflect the current period presentation. For additional information, see the “Non-IFRS FinancialMeasures” section of this news release. |
Thomson Reuters Reports Second-Quarter 2024 Results
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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.
| o | Organic revenues increased 8%, driven by 8% growth in recurring revenues (78% of total revenues) and 15% growth in<br>transactions revenues. Global Print revenues decreased 9% organically. |
|---|---|
| o | The company’s “Big 3” segments reported organic revenue growth of 9% and collectively comprised 82% of<br>total revenues. |
| --- | --- |
Operating profit decreased 27%, primarily because the 2023 period included a $347 million gain on the sale of a majority stake in the company’s Elite business.
| o | Adjusted EBITDA, which excludes the gain on sale of Elite, as well as other items, increased 8% as higher revenues more<br>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.<br> |
|---|
Diluted EPS decreased to $2.92 compared to $3.49 in the prior-year period. The current period reflected lower operating profit and included a $468 million non-cash tax benefit related to tax legislation enacted in Canada. The prior-year period included a significant increase in the value of the company’s investment in LSEG. In 2024, diluted EPS also benefited from a reduction in weighted-average common shares outstanding due to share repurchases and the company’s June 2023 return of capital transaction.
| o | Adjusted EPS, which excludes the gain on sale of Elite, the changes in value of the company’s LSEG<br>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<br>also benefited from a reduction in weighted-average common shares. |
|---|
Net cash provided by operating activities increased by $175 million due to the cash benefits from higher revenues. The prior-year period also included $74 million of payments associated with the company’s Change Program, which was completed at the end of 2022.
| o | Free cash flow increased $83 million as higher cash flows from operating activities more than offset higher<br>capital expenditures and lower cash flows from other investing activities. |
|---|
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Highlights by Customer Segment—Six Months Ended June 30
| (Millions of U.S.dollars, except for adjusted EBITDA margins)<br> <br>(unaudited) | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Six Months EndedJune 30, | Change | ||||||||||||||
| 2024 | 2023 | Total | ConstantCurrency^(1)^ | Organic^(1)(2)^ | |||||||||||
| Revenues | |||||||||||||||
| Legal Professionals | $ | 1,448 | $ | 1,419 | 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 | % | |||||||
| Reuters News | 415 | 369 | 13 | % | 13 | % | 10 | % | |||||||
| Global Print | 247 | 271 | -9 | % | -9 | % | -9 | % | |||||||
| Eliminations/Rounding | (12 | ) | (12 | ) | |||||||||||
| Revenues | $ | 3,625 | **** | $ | 3,385 | **** | **** | 7 | % | **** | 7 | % | **** | 8 | % |
| Adjusted EBITDA^(^^1)^ | |||||||||||||||
| Legal Professionals | $ | 669 | $ | 663 | 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 | % | |||||||||
| Reuters News | 111 | 74 | 50 | % | 51 | % | |||||||||
| Global Print | 90 | 103 | -12 | % | -12 | % | |||||||||
| Corporate costs | (46 | ) | (56 | ) | n/a | n/a | |||||||||
| Adjusted EBITDA | $ | 1,452 | **** | $ | 1,339 | **** | **** | 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 | |||||||||
| Reuters News | 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 thetables appended to this news release for additional information on these and other non-IFRS financial measures. To compute segment and consolidated adjusted EBITDA margin, the company excludes fair valueadjustments related to acquired deferred revenue.<br> <br>(2) Computed for revenue growth only.<br><br><br>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 May 2, 2024 to reflect strong performance in the first half of the year. It also updated the component parts of its outlook for depreciation and amortization of computer software, and for interest expense.
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
Thomson Reuters Reports Second-Quarter 2024 Results
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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<br><br><br>Reported | FY2024<br> <br>Outlook<br><br><br>2/8/2024 | FY 2024<br><br><br>Outlook<br> <br>5/2/2024 | FY 2024<br> <br>Outlook<br> <br>8/1/2024 |
|---|---|---|---|---|
| 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 | $115 million | $120 - $130 million | Unchanged | Unchanged |
| Free Cash Flow^(1)^ | $1.9 billion | ~ $1.8 billion | Unchanged | Unchanged |
| Accrued Capex as % of Revenue^(1)^ | 7.8% | ~ 8.5% | Unchanged | Unchanged |
| Depreciation & Amortization of Computer Software<br><br><br>Depreciation & Amortization of Internally<br><br><br>Developed Software<br><br><br>Amortization of Acquired Software | $628 million<br><br><br> <br>$556 million<br><br><br>$72 million | $730 - $750 million <br><br><br> <br>$595 - $615 million<br><br><br>~ $135 million | Unchanged <br><br><br><br>Unchanged<br> <br>Unchanged | Unchanged<br><br><br><br><br>$580 - $600 million<br><br><br>~ $150 million |
| Interest Expense (P&L)^(2)^ | $164 million^(2)^ | $150 - $170 million | Unchanged | $125 - $145 million |
| Effective Tax Rate on Adjusted Earnings^(1)^ | 16.5% | ~ 18% | Unchanged | Unchanged |
| “Big 3”Segments^(1)^ | FY 2023<br><br><br>Reported | FY 2024<br><br><br>Outlook<br> <br>2/8/2024 | FY 2024<br><br><br>Outlook<br> <br>5/2/2024 | FY 2024<br> <br>Outlook<br> <br>8/1/2024 |
| 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<br>“Non-IFRS Financial Measures” section below as well as the tables and footnotes appended to this news release for more information. | |||
| --- | --- | |||
| (2) | Full-year 2023 interest expense excludes a $12 million benefit associated with the release of a tax reserve that is<br>removed from adjusted earnings. | |||
| --- | --- |
The information in this section is forward-looking. Actual results, which will include the impact ofcurrency 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 NoteRegarding Forward-Looking Statements, Material Risks and Material Assumptions.”
Thomson Reuters Reports Second-Quarter 2024 Results
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Dividends
In February 2024, the company announced a 10% or $0.20 per share annualized increase in the dividend to $2.16 per common share, representing the 31^st^ consecutive year of dividend increases. A quarterly dividend of $0.54 per share is payable on September 10, 2024 to common shareholders of record as of August 15, 2024.
Share Repurchases –Completed $1.0 Billion Buyback Program
In November 2023, Thomson Reuters announced that it planned to repurchase up to $1.0 billion of its common shares. In the second quarter of 2024, the company completed this plan by repurchasing approximately 1.8 million of its common shares for $287 million.
As of July 30, 2024, Thomson Reuters had approximately 449.7 million common shares outstanding.
LSEG Ownership Interest
Thomson Reuters indirectly owned LSEG shares through an entity that it jointly owns with Blackstone’s consortium. During the second quarter of 2024, the company sold its remaining 5.9 million shares that it indirectly owned and received $0.6 billion of gross proceeds.
Thomson Reuters
Thomson Reuters (NYSE / TSX: TRI) informs the way forward by bringing together the trusted content and technology that people and organizations need to make the right decisions. The company serves professionals across legal, tax, accounting, compliance, government, and media. Its products combine highly specialized software and insights to empower professionals with the data, intelligence, and solutions needed to make informed decisions, and to help institutions in their pursuit of justice, truth and transparency. Reuters, part of Thomson Reuters, is a world leading provider of trusted journalism and news. For more information, visit tr.com.
NON-IFRS FINANCIAL MEASURES
Thomson Reuters prepares its financial statements in accordance with International Financial Reporting Standards (IFRS), as issued by the International AccountingStandards Board (IASB).
This news release includes certain non-IFRS financial measures, which include ratios thatincorporate 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 onadjusted 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 forthe “Big 3” segments.
As of September 30, 2023, Thomson Reuters amended its definition of adjusted earnings to exclude amortization fromacquired computer software. While the company has always excluded amortization from acquired identifiable intangible assets other than computer software from its definition of adjusted earnings, this change aligns its treatment ofamortization for all acquired intangible assets. Prior period amounts were revised for comparability.
Thomson Reuters uses these non-IFRS financial measures as supplemental indicators of its operating performance and financial position as well as for internal planning purposes and the company’s business outlook. Additionally, ThomsonReuters 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 thecalculation 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 definedand 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 misleadingand 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 toreconcile these non-IFRS measures to the most
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directly comparable IFRS measures because it cannot predict, with reasonable certainty, the impacts of changes inforeign 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, thecompany 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 ofU.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 torounding.
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 “2024 Outlook” section, areforward-looking. The words “will”, “expect”, “believe”, “target”, “estimate”, “could”, “should”, “intend”, “predict”, “project” and similarexpressions 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 noassurance 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 differmaterially 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 inthis 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 inmaterials that Thomson Reuters from time-to-time files with, or furnishes to, the Canadian securities regulatory authorities and the U.S. Securities and ExchangeCommission (SEC). Thomson Reuters annual and quarterly reports are also available in the “Investor Relations” section of tr.com*.*
Thecompany’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, currentconditions 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’sexpectations 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. Thecompany’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 anyworsening 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 thecompany’s 2024 outlook see page 18 of the company’s first-quarter management’s discussion and analysis (MD&A) for the period ended March 31, 2024. The company’s quarterly MD&A and annual report wasfiled 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 outlook for the purpose of presenting information about current expectations for the period presented. This information may not beappropriate 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.
Thomson Reuters Reports Second-Quarter 2024 Results
Page 11 of 22 ****
CONTACTS
| MEDIA<br> <br>Gehna Singh Kareckas<br><br><br>Senior Director, Corporate Affairs<br> <br>+1 613 979 4272<br><br><br>[email protected] | INVESTORS<br> <br>Gary Bisbee, CFA<br><br><br>Head of Investor Relations<br> <br>+1 646 540 3249<br><br><br>[email protected] |
|---|
Thomson Reuters will webcast a discussion of its second-quarter 2024 results and its 2024 business outlook today beginning at 8:30a.m. Eastern Daylight Time (EDT). You can access the webcast by visiting ir.tr.com. An archive of the webcast will be available following the presentation.
Thomson Reuters Reports Second-Quarter 2024 Results
Page 12 of 22 ****
Thomson Reuters Corporation
Consolidated Income Statement
(millions of U.S. dollars, except per share data)
(unaudited)
| Three Months Ended | Six Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| June 30, | June 30, | |||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||
| CONTINUING OPERATIONS | ||||||||||||
| Revenues | $ | 1,740 | $ | 1,647 | $ | 3,625 | $ | 3,385 | ||||
| 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 | $ | 841 | $ | 894 | $ | 1,319 | $ | 1,650 | ||||
| Earnings (loss) attributable to: | ||||||||||||
| Common shareholders | $ | 841 | $ | 894 | $ | 1,322 | $ | 1,650 | ||||
| Non-controlling interests | — | — | (3 | ) | — | |||||||
| Earnings per share: | ||||||||||||
| Basic earnings (loss) per share: | ||||||||||||
| From continuing operations | $ | 1.87 | $ | 1.89 | $ | 2.90 | $ | 3.44 | ||||
| From discontinued operations | (0.01 | ) | 0.01 | 0.02 | 0.05 | |||||||
| Basic earnings per share | $ | 1.86 | $ | 1.90 | $ | 2.92 | $ | 3.49 | ||||
| Diluted earnings (loss) per share: | ||||||||||||
| From continuing operations | $ | 1.87 | $ | 1.89 | $ | 2.89 | $ | 3.43 | ||||
| From discontinued operations | (0.01 | ) | 0.01 | 0.03 | 0.06 | |||||||
| Diluted earnings per share | $ | 1.86 | $ | 1.90 | $ | 2.92 | $ | 3.49 | ||||
| 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 |
Thomson Reuters Reports Second-Quarter 2024 Results
Page 13 of 22 ****
Thomson Reuters Corporation
Consolidated Statement of Financial Position
(millions of U.S. dollars)
(unaudited)
| June 30,2024 | December 31,2023 | |||||
|---|---|---|---|---|---|---|
| Assets | ||||||
| Cash and cash equivalents | $ | 1,682 | $ | 1,298 | ||
| 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 | ||||
| Goodwill | 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 | $ | 18,378 | $ | 18,684 | ||
| Liabilities and equity | ||||||
| Liabilities | ||||||
| Current indebtedness | $ | 1,264 | $ | 372 | ||
| 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 | $ | 18,378 | $ | 18,684 |
Thomson Reuters Reports Second-Quarter 2024 Results
Page 14 of 22 ****
Thomson Reuters Corporation
Consolidated Statement of Cash Flow
(millions of U.S. dollars)
(unaudited)
| Three Months Ended<br>June 30, | Six Months Ended<br>June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |||||||||
| Cash provided by (used in): | ||||||||||||
| Operating activities | ||||||||||||
| Earnings from continuing operations | $ | 844 | $ | 889 | $ | 1,308 | $ | 1,626 | ||||
| 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 | $ | 1,682 | $ | 2,858 | $ | 1,682 | $ | 2,858 |
Thomson Reuters Reports Second-Quarter 2024 Results
Page 15 of 22 ****
Thomson Reuters Corporation
Reconciliation of Earnings from Continuing Operations to Adjusted EBITDA^(1)^
(millions of U.S. dollars, except for margins)
(unaudited)
| Three Months Ended | Six Months Ended | Year Ended | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| June 30, | June 30, | December 31, | |||||||||||||
| 2024 | 2023 | 2024 | 2023 | 2023 | |||||||||||
| Earnings from continuing operations | $ | 844 | $ | 889 | $ | 1,308 | $ | 1,626 | $ | 2,646 | |||||
| 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 | $ | 682 | $ | 1,423 | $ | 1,437 | $ | 2,674 | $ | 4,132 | |||||
| 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)^ | $ | 646 | **** | $ | 662 | **** | $ | 1,452 | **** | $ | 1,339 | **** | $ | 2,678 | **** |
| 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 courseof business due to changes in foreign currency exchange rates, which are a component of operating expenses, as well as adjustments related to acquired deferred revenue. | ||||||||||||||
| --- | --- |
Thomson Reuters Corporation
Reconciliationof Net Cash Provided By Operating Activities to Free Cash Flow^(1)^
(millions of U.S. dollars)
(unaudited)
| Three Months Ended | Six Months Ended | Year Ended | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| June 30, | June 30, | December 31, | |||||||||||||
| 2024 | 2023 | 2024 | 2023 | 2023 | |||||||||||
| Net cash provided by operating activities | $ | 705 | $ | 695 | $ | 1,137 | $ | 962 | $ | 2,341 | |||||
| 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)^ | $ | 541 | **** | $ | 596 | **** | $ | 812 | **** | $ | 729 | **** | $ | 1,871 | **** |
Thomson Reuters Corporation
Reconciliation of Capital Expenditures to Accrued Capital Expenditures^(1)^
(millions of U.S. dollars)
(unaudited)
| Year EndedDecember 31, | |||
|---|---|---|---|
| 2023 | |||
| Capital expenditures | $ | 544 | |
| Remove: IFRS adjustment to cash basis | (12 | ) | |
| Accrued capital expenditures^(1)^ | $ | 532 | **** |
| Accrued capital expenditures as a percentage ofrevenues^(1)^ | **** | 7.8 | % |
| (1) | Refer to page 22 for additional information on non-IFRS financial measures.<br> | ||
| --- | --- |
Thomson Reuters Reports Second-Quarter 2024 Results
Page 16 of 22 ****
Thomson Reuters Corporation
Reconciliation of Net Earnings to Adjusted Earnings^(1)^
Reconciliation of Total Change in Adjusted EPS to Change in Constant Currency^(1)^
(millions of U.S. dollars, except for share and per share data)
(unaudited)
| Three Months Ended<br>June 30, | Six Months Ended<br>June 30, | Year EndedDecember 31, | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024^^ | 2023^^ | 2024^^ | 2023^^ | 2023 | |||||||||||
| Net earnings | $ | 841 | $ | 894 | $ | 1,319 | $ | 1,650 | $ | 2,695 | |||||
| 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)^ | $ | 385 | **** | $ | 412 | **** | $ | 888 | **** | $ | 808 | **** | $ | 1,629 | **** |
| Adjusted EPS^(1)^^(3)^ | $ | 0.85 | **** | $ | 0.88 | **** | $ | 1.97 | **** | $ | 1.71 | **** | |||
| 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-endedDecember 31, | ||||||||||||||
| --- | --- | --- | --- | ||||||||||||
| 2023 | |||||||||||||||
| Adjusted earnings | $ | 1,629 | **** | ||||||||||||
| Plus: Dividends declared on preference shares | 5 | ||||||||||||||
| Plus: Tax expense on adjusted earnings | 324 | ||||||||||||||
| Pre-tax adjusted earnings | $ | 1,958 | **** | ||||||||||||
| IFRS Tax expense | $ | 417 | **** | ||||||||||||
| Remove tax related to: | |||||||||||||||
| Amortization of acquired computer software | 17 | ||||||||||||||
| Amortization of other identifiable intangible assets | 22 | ||||||||||||||
| Share of post-tax earnings in equity method investments**** | (253 | ) | |||||||||||||
| Other finance costs | 31 | ||||||||||||||
| Other operating gains, net | (81 | ) | |||||||||||||
| Other items | (1 | ) | |||||||||||||
| Subtotal—Remove tax expense on pre-tax items removed from<br>adjusted earnings | (265 | ) | |||||||||||||
| Remove: Tax items impacting comparability | 172 | ||||||||||||||
| Total—Remove all items impacting comparability | (93 | ) | |||||||||||||
| Tax expense on adjusted earnings | $ | 324 | **** | ||||||||||||
| Effective tax rate on adjusted earnings | **** | 16.5 | % | ||||||||||||
| * | Fair value adjustments primarily represent gains or losses on intercompany balances that arise in the ordinary courseof 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.<br> | ||||||||||||||
| --- | --- | ||||||||||||||
| (2) | The year ended December 31, 2023, included the release of tax and interest reserves due to the expiration of statutes<br>of limitation. | ||||||||||||||
| --- | --- | ||||||||||||||
| (3) | The adjusted earnings impact of non-controlling interests, which was applicable<br>only to the six months ended June 30, 2024, was not material. | ||||||||||||||
| --- | --- |
Thomson Reuters Reports Second-Quarter 2024 Results
Page 17 of 22 ****
Thomson Reuters Corporation
Reconciliation of Changes in Revenues to Changes in Revenues on a Constant Currency^(1)^ and OrganicBasis^(1)^
(millions of U.S. dollars)
(unaudited)
| Three Months EndedJune 30, | Change | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | Total | ForeignCurrency | SUBTOTALConstantCurrency | Net<br>Acquisitions/(Divestitures) | Organic | |||||||||||||||
| Total Revenues | |||||||||||||||||||||
| Legal Professionals | $ | 727 | $ | 705 | 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 | % | |||||||||
| Reuters News | 205 | 194 | 6 | % | -1 | % | 7 | % | 3 | % | 4 | % | |||||||||
| Global Print | 123 | 133 | -8 | % | -1 | % | -7 | % | 0 | % | -7 | % | |||||||||
| Eliminations/Rounding | (7 | ) | (6 | ) | |||||||||||||||||
| Revenues | $ | 1,740 | **** | $ | 1,647 | **** | **** | 6 | % | **** | -1 | % | **** | 6 | % | **** | 0 | % | **** | 6 | % |
| Recurring Revenues | |||||||||||||||||||||
| Legal Professionals | $ | 702 | $ | 667 | 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 | % | |||||||||
| Reuters News | 164 | 155 | 6 | % | -1 | % | 7 | % | 3 | % | 4 | % | |||||||||
| Eliminations/Rounding | (7 | ) | (6 | ) | |||||||||||||||||
| Total Recurring Revenues | $ | 1,420 | **** | $ | 1,323 | **** | **** | 7 | % | **** | -1 | % | **** | 8 | % | **** | 0 | % | **** | 8 | % |
| Transactions Revenues | |||||||||||||||||||||
| Legal Professionals | $ | 25 | $ | 38 | -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 | % | |||||||||
| Reuters News | 41 | 39 | 6 | % | -1 | % | 7 | % | 4 | % | 2 | % | |||||||||
| Total Transactions Revenues | $ | 197 | **** | $ | 191 | **** | **** | 4 | % | **** | -1 | % | **** | 4 | % | **** | 0 | % | **** | 5 | % |
Growth percentages are computed using whole dollars. As a result, percentages calculated from reported amounts may differ from thosepresented, and growth components may not total due to rounding.
| (1) | Refer to page 22 for additional information on non-IFRS financial measures.<br> |
|---|
Thomson Reuters Reports Second-Quarter 2024 Results
Page 18 of 22 ****
Thomson Reuters Corporation
Reconciliation of Changes in Revenues to Changes in Revenues on a Constant Currency^(1)^ and OrganicBasis^(1)^
(millions of U.S. dollars)
(unaudited)
| Six Months EndedJune 30, | Change | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | Total | ForeignCurrency | SUBTOTALConstantCurrency | Net<br>Acquisitions/(Divestitures) | Organic | |||||||||||||||
| Total Revenues | |||||||||||||||||||||
| Legal Professionals | $ | 1,448 | $ | 1,419 | 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 | % | |||||||||
| Reuters News | 415 | 369 | 13 | % | -1 | % | 13 | % | 3 | % | 10 | % | |||||||||
| Global Print | 247 | 271 | -9 | % | 0 | % | -9 | % | 0 | % | -9 | % | |||||||||
| Eliminations/Rounding | (12 | ) | (12 | ) | |||||||||||||||||
| Revenues | $ | 3,625 | **** | $ | 3,385 | **** | **** | 7 | % | **** | 0 | % | **** | 7 | % | **** | 0 | % | **** | 8 | % |
| Recurring Revenues | |||||||||||||||||||||
| Legal Professionals | $ | 1,400 | $ | 1,339 | 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 | % | |||||||||
| Reuters News | 328 | 310 | 6 | % | -1 | % | 7 | % | 3 | % | 4 | % | |||||||||
| Eliminations/Rounding | (12 | ) | (12 | ) | |||||||||||||||||
| Total Recurring Revenues | $ | 2,846 | **** | $ | 2,646 | **** | **** | 8 | % | **** | 0 | % | **** | 8 | % | **** | -1 | % | **** | 8 | % |
| Transactions Revenues | |||||||||||||||||||||
| Legal Professionals | $ | 48 | $ | 80 | -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 | % | |||||||||
| Reuters News | 87 | 59 | 48 | % | -1 | % | 49 | % | 8 | % | 41 | % | |||||||||
| Total Transactions Revenues | $ | 532 | **** | $ | 468 | **** | **** | 14 | % | **** | -1 | % | **** | 15 | % | **** | 0 | % | **** | 15 | % |
| Year EndedDecember 31, | Change | ||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 2023 | 2022 | Total | ForeignCurrency | SUBTOTALConstantCurrency | Net<br>Acquisitions/(Divestitures) | Organic | |||||||||||||||
| Total Revenues | |||||||||||||||||||||
| Legal Professionals | $ | 2,807 | $ | 2,803 | 0 | % | 0 | % | 0 | % | -6 | % | 6 | % | |||||||
| Corporates | 1,620 | 1,536 | 5 | % | 0 | % | 5 | % | -2 | % | 7 | % | |||||||||
| Tax & Accounting Professionals | 1,058 | 986 | 7 | % | -2 | % | 9 | % | -1 | % | 10 | % | |||||||||
| “Big 3” Segments Combined^(1)^ | 5,485 | 5,325 | 3 | % | 0 | % | 4 | % | -4 | % | 7 | % | |||||||||
| Reuters News | 769 | 733 | 5 | % | 0 | % | 5 | % | 1 | % | 4 | % | |||||||||
| Global Print | 562 | 592 | -5 | % | -1 | % | -4 | % | -1 | % | -3 | % | |||||||||
| Eliminations/Rounding | (22 | ) | (23 | ) | |||||||||||||||||
| Revenues | $ | 6,794 | **** | $ | 6,627 | **** | **** | 3 | % | **** | 0 | % | **** | 3 | % | **** | -3 | % | **** | 6 | % |
Growth percentages are computed using whole dollars. As a result, percentages calculated from reported amounts may differ from thosepresented, and growth components may not total due to rounding.
| (1) | Refer to page 22 for additional information on non-IFRS financial measures.<br> |
|---|
Thomson Reuters Reports Second-Quarter 2024 Results
Page 19 of 22 ****
Thomson Reuters Corporation
Reconciliation of Changes in Adjusted EBITDA^(1)^ and Related Margin^(1)^ to Changes on a Constant Currency^^Basis^(1)^
(millions of U.S. dollars, except for margins)
(unaudited)
| Three Months EndedJune 30, | Change | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | Total | Foreign<br>Currency | Constant<br>Currency | |||||||||||
| Adjusted EBITDA^(1)^ | |||||||||||||||
| Legal Professionals | $ | 327 | $ | 345 | -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 | % | |||||||
| Reuters News | 51 | 45 | 13 | % | 0 | % | 14 | % | |||||||
| Global Print | 43 | 53 | -18 | % | 0 | % | -18 | % | |||||||
| Corporate costs | (29 | ) | (33 | ) | n/a | n/a | n/a | ||||||||
| Adjusted EBITDA | $ | 646 | **** | $ | 662 | **** | **** | -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 | ||||||||
| Reuters News | 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 | **** |
Thomson Reuters Corporation
Reconciliation of Changes in Adjusted EBITDA^(1)^ and Related Margin^(1)^ to Changes on a Constant Currency^^Basis^(1)^
(millions of U.S. dollars, except for margins)
(unaudited)
| Six Months Ended | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| June 30, | Change | ||||||||||||||
| 2024 | 2023 | Total | Foreign<br>Currency | Constant<br>Currency | |||||||||||
| Adjusted EBITDA^(1)^ | |||||||||||||||
| Legal Professionals | $ | 669 | $ | 663 | 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 | % | |||||||
| Reuters News | 111 | 74 | 50 | % | -2 | % | 51 | % | |||||||
| Global Print | 90 | 103 | -12 | % | 0 | % | -12 | % | |||||||
| Corporate costs | (46 | ) | (56 | ) | n/a | n/a | n/a | ||||||||
| Adjusted EBITDA | $ | 1,452 | **** | $ | 1,339 | **** | **** | 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 | ||||||||
| Reuters News | 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 andmargins 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.<br> |
|---|
Thomson Reuters Reports Second-Quarter 2024 Results
Page 20 of 22 ****
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 June 30, 2024 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| IFRS revenues | Remove fair valueadjustments toacquired deferredrevenue | Revenues excludingfair valueadjustments toacquired deferredrevenue | Adjusted EBITDA | Adjusted EBITDAMargin | ||||||||||
| Legal Professionals | $ | 727 | — | $ | 727 | $ | 327 | 45.0 | % | |||||
| Corporates | 442 | $ | 2 | 444 | 163 | 36.8 | % | |||||||
| Tax & Accounting Professionals | 250 | — | 250 | 91 | 36.8 | % | ||||||||
| “Big 3” Segments Combined | 1,419 | 2 | 1,421 | 581 | 41.0 | % | ||||||||
| Reuters News | 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 | $ | 1,740 | $ | 2 | $ | 1,742 | $ | 646 | 37.1 | % | ||||
| Six months ended June 30, 2024 | ||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| IFRS revenues | Remove fair valueadjustments toacquired deferredrevenue | Revenues excludingfair valueadjustments toacquired deferredrevenue | Adjusted EBITDA | Adjusted EBITDAMargin | ||||||||||
| Legal Professionals | $ | 1,448 | — | $ | 1,448 | $ | 669 | 46.2 | % | |||||
| Corporates | 949 | $ | 5 | 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 | % | ||||||||
| Reuters News | 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 | $ | 3,625 | $ | 6 | $ | 3,631 | $ | 1,452 | 40.0 | % | ||||
| Three months ended June 30, 2023 | ||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| IFRS revenues | Remove fair valueadjustments toacquired deferredrevenue | Revenues excludingfair valueadjustments toacquired deferredrevenue | Adjusted EBITDA | Adjusted EBITDAMargin | ||||||||||
| Legal Professionals | $ | 705 | — | $ | 705 | $ | 345 | 48.9 | % | |||||
| Corporates | 392 | $ | 1 | 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 | % | ||||||||
| Reuters News | 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 | $ | 1,647 | $ | 4 | $ | 1,651 | $ | 662 | 40.1 | % |
n/a: not applicable
Margins are computedusing 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.<br> |
|---|
Thomson Reuters Reports Second-Quarter 2024 Results
Page 21 of 22 ****
Reconciliation of adjusted EBITDA margin^(1)^
| Six months ended June 30, 2023 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| IFRS revenues | Remove fair valueadjustments toacquired deferredrevenue | Revenues excludingfair valueadjustments toacquired deferredrevenue | Adjusted EBITDA | Adjusted EBITDAMargin | ||||||||||
| Legal Professionals | $ | 1,419 | — | $ | 1,419 | $ | 663 | 46.7 | % | |||||
| Corporates | 827 | $ | 3 | 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 | % | ||||||||
| Reuters News | 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 | $ | 3,385 | $ | 13 | $ | 3,398 | $ | 1,339 | 39.4 | % |
Thomson Reuters Corporation
“Big 3” Segments and Consolidated Adjusted EBITDA^(1)^ and the Related Margins^(1)^
(millions of U.S. dollars, except for margins)
(unaudited)
| Year Ended | |||
|---|---|---|---|
| December 31, | |||
| 2023 | |||
| Adjusted EBITDA^(1)^ | |||
| Legal Professionals | $ | 1,299 | |
| Corporates | 619 | ||
| Tax & Accounting Professionals | 490 | ||
| “Big 3” Segments Combined^(1)^ | 2,408 | ||
| Reuters News | 172 | ||
| Global Print | 213 | ||
| Corporate costs | (115 | ) | |
| Adjusted EBITDA | $ | 2,678 | **** |
| “Big 3” Segments Combined^(1) ****^ | |||
| Adjusted EBITDA | $ | 2,408 | |
| Revenues, excluding $15 million of fair value adjustments to acquired deferred revenue | $ | 5,500 | |
| Adjusted EBITDA margin | 43.8 | % | |
| Consolidated^(1)^ **** | |||
| Adjusted EBITDA | $ | 2,678 | |
| Revenues, excluding $16 million of fair value adjustments to acquired deferred revenue | $ | 6,810 | |
| Adjusted EBITDA margin | 39.3 | % |
n/a: not applicable
Margins are computedusing 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.<br> |
|---|
Thomson Reuters Reports Second-Quarter 2024 Results
Page 22 of 22 ****
| Non-IFRSFinancial<br> <br>Measures | Definition | Why Useful to the Company and Investors |
|---|---|---|
| Adjusted<br>EBITDA and the related margin | Represents earnings or losses from continuing operations<br>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<br>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.<br><br><br><br> <br>The related margin is adjusted EBITDA expressed as a percentage of revenues. For purposes of this<br>calculation, revenues are before fair value adjustments to acquired deferred revenue. | Provides a consistent basis to evaluate<br>operating profitability and performance trends by excluding items that the company does not consider to be controllable activities for this purpose.<br> <br><br><br><br>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<br>debt. |
| Adjusted earnings and adjusted EPS | Net earnings or loss including dividends declared on<br>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<br>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<br>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<br>earnings.<br> <br><br> <br>The post-tax amount of each item is excluded<br>from adjusted earnings based on the specific tax rules and tax rates associated with the nature and jurisdiction of each item.<br> <br><br><br><br>Adjusted EPS is calculated from adjusted earnings using diluted weighted-average shares and does not represent actual earnings or loss per share attributable to<br>shareholders. | Provides a more comparable basis to<br>analyze earnings.<br> <br><br> <br>These measures are commonly used by shareholders to measure<br>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<br>impacting comparability.<br> <br><br> <br>In interim periods, we also make an adjustment to reflect income<br>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<br>effective tax rate associated with adjusted earnings.<br> <br><br> <br>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<br>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<br>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<br>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<br>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<br>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<br>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<br>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<br>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<br>business information service product offerings. |
Please refer to reconciliations for the most directly comparable IFRS financial measures.