Bloomberg News

Thomson Reuters Reports Quarterly Loss on Impairment Charge

February 09, 2012

(Updates with closing share price in the penultimate paragraph.)

Feb. 9 (Bloomberg) -- Thomson Reuters Corp., the provider of news and information services, reported a fourth-quarter loss, reflecting a $3 billion writedown of assets in the financial-services business.

The net loss was $2.6 billion, or $3.11 a share, compared with net income of $225 million, or 27 cents, a year earlier, the New York-based company said today in a statement. Excluding items such as the charge, the company had profit of 54 cents a share. Analysts had projected 56 cents, the average of estimates compiled by Bloomberg.

Thomson Reuters named James Smith, 52, as chief executive officer in December, replacing Tom Glocer, who had run Reuters since 2001. The company is controlled by the Thomson family through Woodbridge Co., the family’s investment firm, which holds a 55 percent stake, according to data compiled by Bloomberg.

Thomson Reuters’ financial-services business, which provides market data to stock traders, declined in value, leading to a $3 billion reduction in assets recorded on the books.

The company described the change as a goodwill impairment charge taken after annual testing required under international accounting standards. The non-cash charge won’t affect operations, liquidity, cash flow or covenants in debt agreements, according to the statement.

‘Challenging’ Conditions

Thomson Reuters in December suspended plans to sell its health-care business, citing “challenging” economic conditions. The state of the global economy would make it difficult to get fair value for the health unit, which provides data to government agencies and health-care professionals, the company said in a statement at the time.

Separately, Reuters News reported that its own journalists based in London called off a planned strike for today. Reuters journalists who are members of the National Union of Journalists in the U.K. accepted Thomson Reuters’ offer of a 3 percent pay increase with 2.5 percent of that amount guaranteed.

Thomson Reuters fell 1.2 percent to C$27.36 ($27.49) in Toronto at the close. The shares have dropped 33 percent in the last 12 months, compared with a 9.3 percent decline for the Standard & Poor’s/TSX Composite Index.

Bloomberg LP, the parent of Bloomberg News, competes with Thomson Reuters in selling financial and legal information and trading systems.

--With assistance from Cecile Daurat in Wilmington. Editors: Jeffrey Tannenbaum, John Lear

To contact the reporter on this story: Edmund Lee in New York at elee310@bloomberg.net

To contact the editor responsible for this story: Ville Heiskanen at vheiskanen@bloomberg.net


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