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Tuesday, 12 February, 2002, 07:25 GMT
Market woes hit Reuters' profits
Reuters logo
Profits fall short of expectations
Global news and data provider Reuters has said profits are down by a third, blaming investment costs and a "difficult" trading environment.

Tom Glocer
Tom Glocer: Trading conditions are difficult
Profits before tax and one-off costs for 2001 fell by 34% on the year to 304m (440m), undershooting analysts' forecasts of around 330m.

Total sales for 2001 were up by about 8% at 3.9bn, but revenue growth flattened in the final three months of the year.

Reuters, a leading provider of financial news, has been hit hard by last year's downturn in global financial markets. The company is also bearing heavy investment costs as it switches to internet-based publication systems.

No quick recovery

"The current trading environment is difficult," said Reuters chief executive Tom Glocer, adding that the company is now developing "more focused" plans for boosting sales.

However, Reuters does not expect an immediate recovery in demand, forecasting a further 2-3% decline in subscription revenues during the first half of 2002.

In the City, Reuters shares were marked down 28p at 564p in early trade on Tuesday.

Reuters shares have fallen by about 40% in the past year, reflecting investor concerns over the impact on the firm of recession-induced cost cuts at its major clients.

More jobs to go

The effect of the financial market downturn on the company has been lagged because many of its subscribers are locked into long-term contracts.

Last year, Reuters cut about 1,600 jobs and axed its financial TV operation in a bid to cut costs by 220m a year by 2003.

A further 200 jobs are to go this year as part of an effort to trim another 15m in costs, the company said on Tuesday.

Reuters added that it lost assets worth around 10m and a further 17m in revenues in the 11 September attacks.

See also:

24 Jul 01 | Business
Reuters cuts 1,100 jobs
20 Jul 01 | Business
Web publishers charge for content
25 May 01 | Business
Rescue deal nears for Bridge News
18 May 01 | Business
Instinet float beats expectations
07 Jun 01 | Business
Reuters in management shake-up
15 May 01 | Business
Making money from financial news
12 Apr 01 | Business
Reuters eyes up rival
29 Nov 01 | Business
Reuters axes financial TV
16 Oct 01 | Business
Reuters cuts more jobs
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