After headwinds, TR turns the tide - CEO James Smith

“2012 was a watershed year for us,” said James Smith, chief executive, pictured, in a statement accompanying the 4Q and 2012 full year results on Wednesday.

“First and foremost, we achieved our targets for the full year for revenues, profit and free cash flow. Given the headwinds we faced in 2012, that performance reaffirmed just how strong this business really is.

“2012 will best be known as the year we turned the tide in our Financial & Risk business. I said last year that our journey would entail a multi-quarter turnaround; we are halfway through that process. We laid the groundwork for future success with solid improvements in product quality, customer service and execution capabilities.

“We enter 2013 with more confidence and a much stronger foundation.”

The company said it expects revenue to increase in the low single digits this year.

Profit in the quarter increased on the back of what the company called “continued cost containment and lower reorganisation costs”. Organic revenue was flat.

Financial & Risk, which includes Reuters news agency, accounts for 54 per cent of Thomson Reuters’ total revenue. It has struggled following a troubled launch of Eikon, its flagship desktop product for bankers, hedge fund managers, and other industry professionals. The number of Eikons installed rose 33 per cent in the fourth quarter from the previous quarter to 33,900.

Cost cutting by banks after the financial crisis compounded the difficulties, especially in Europe.

Thomson Reuters said revenue from ongoing businesses in the fourth quarter rose two per cent before currency changes to $3.36 billion. Reuters reported it was not immediately clear what the change in costs was on the same basis.

Adjusted earnings increased to $497 million, or 60 cents per share, from $445 million, or 54 cents per share, a year earlier.

F&R revenue in Europe, Middle East and Africa and in Asia was down three per cent in both regions; the Americas gained six per cent.

The board approved a two cent annual dividend increase to $1.30 per share. ■