Fearing cyber attacks, Thomson Reuters CEO boosts defence

Chief executive James Smith told shareholders that one of his biggest worries as the leader of a technology-dependent company concerns cyber attacks.

“We have stepped up, in a major way, our planning and the resources we put behind cyber security,” he said at the company’s annual meeting in Toronto. “It has been raised to a board-level oversight function.”

Smith also said the company’s new programme, announced earlier on Wednesday, to spend up to $1 billion in buying back its own shares was because it has no big plans for acquisitions, and has enough funds to support internal growth.

Thomson Reuters is generating cash, and “in the current M&A environment, we find great value in buying back our shares at the current level, compared [with] the multiples that some acquisition targets are commanding in the marketplace,” he said.

The company will buy back common shares before the end of 2016, in addition to the $1 billion worth of shares it has repurchased since July 2014.

In response to a shareholder who suggested the money might be “more constructively invested in growing the corporation,” Smith said the management and board feel “we have adequate resources within the company right now to fund the next legs of the journey that we are on.”

The buyback “is a prudent lever for us to pull at this time,” Smith said. The company will revisit its plans for deploying capital after it works on its broader corporate strategy this summer, he added. “We do believe we have adequate resources to support our growth opportunities today.”

Acquisitions, which in the past were made at a furious pace, have been reduced significantly in the past two years. The company is now focused on “exploiting the things we already do well,” Smith said.

He said he has simplified the company, and it is now in a position to take advantage of clients’ desire to mine “big data” and their need to deal with complex legal and regulatory environments. The company is also integrating its various divisions that sell technology and information to financial institutions, legal and tax professionals, consultants and scientists.

“Increasingly, the needs of our customers transcend industries,” he said. “Lawyers need access to financial information, tax professionals need legal precedents, media need access to data and traders act on news, legal verdicts and even social-media sentiment.” ■