logo-loader
RNS
Thomson Reuters

Thomson Reuters Corp - 1st Quarter Results

Thomson Reuters Reports First-Quarter 2020 Results and Updates Full-Year Outlook

, /PRNewswire/ -- Thomson Reuters (TSX/NYSE: TRI) today reported results for the first quarter ended and updated its full-year 2020 Outlook to reflect its currently estimated impact of the COVID-19 pandemic.TORONTOMay 5, 2020March 31, 2020

Logo -https://mma.prnewswire.com/media/13199/THOMSON_REUTERS_LOGO.jpg

"Given the challenges we are all facing from the COVID-19 pandemic, our main priority remains the health and safety of all of our employees. I want to thank them for how they have stepped up to support our customers around the globe as they help businesses, communities and economies do what they can to move forward," said , president and CEO of Thomson Reuters. "We entered the year with an encouragingly strong start and delivered a good first quarter as our Legal, Corporates and Tax & Accounting segments - 80% of total revenues – grew 4% organically.  As we generate most of our revenues from selling information and software solutions electronically and on a subscription basis, our businesses have historically been resilient over time, but they are not immune to the recent downturn in the global economy. We are confident that our 'must-have' products and solutions, deep and long-term customer relationships, and strong balance sheet and liquidity position will enable us to emerge on the other side even stronger."Steve Hasker

This news release discusses the evolving impact of the COVID-19 pandemic on Thomson Reuters business, financial condition and results of operations as well as Thomson Reuters response to the pandemic. 

Consolidated Financial Highlights - Three Months EndedMarch 31

increased 2% due to growth in recurring revenues but also from higher transactions revenues, which were driven by acquisitions. Foreign currency had a (approximately 1%) negative impact.Revenues$14 million

increased as higher revenues and lower costs more than offset a negative impact from the revaluation of warrants that the company holds in Refinitiv relating to the proposed sale of Refinitiv to London Stock Exchange Group plc (LSEG). Lower costs reflected the completion of the program, in 2019, to reposition the company following the separation from Financial & Risk (F&R).Operating profit

 increased to compared to per share in the prior-year period as higher operating profit, lower losses from the company's 45% equity interest in Refinitiv, and currency benefits from the revaluation of certain intercompany funding arrangements more than offset higher tax expense.Diluted EPS$0.39$0.20

increased, primarily due to a pension plan contribution in the prior-year period.Cash flow from operations$167 million

Highlights by Customer Segment - Three Months EndedMarch 31

Unless otherwise noted, all revenue growth comparisons by customer segment in this news release are at (or exclude the impact of foreign currency) as Thomson Reuters believes this provides the best basis to measure their performance.constantcurrency

Legal Professionals

 increased 5% (4% organic) to .Revenues$626 million

 of was flat.Adjusted EBITDA$230 million

Corporates

 increased 7% (5% organic) to , primarily due to strong recurring revenue growth. Growth of 7% also reflected the acquisitions of Confirmation () and HighQ (), which more than offset a loss of revenues following the sale of the /Legal Managed Services business (May 2019).Revenues$367 millionJuly 2019July 2019Pangea3

 increased 5% to .Adjusted EBITDA$117 million

Tax & Accounting Professionals

 of were unchanged (organic also unchanged) as expected, due to the permanent acceleration of some UltraTax state tax software releases from to to more closely align with the traditional December release of federal tax software. If the UltraTax software had been released in , revenue growth for the segment in the first quarter of 2020 would have been 6%.Revenues$218 millionU.S.U.S.January 2020December 2019January 2020

 declined 8% to .Adjusted EBITDA$84 million

Reuters News

of million were flat and organic revenues decreased 4% due to COVID-19 related cancellations of events in the Reuters Events business (formerly FC Business Intelligence), which was acquired in .Revenues$155October 2019

Adjusted EBITDA was , down from the prior-year period mainly due to costs associated with the cancellation of Reuters Events and higher investments.$19 million$4 million

Global Print

Revenues decreased 5% to .$155 million

In the second quarter of 2020, the company expects Global Print's revenues to decline by about , reflecting about a 15% to 25% decline in the segment's organic revenues. While the company's manufacturing plant in remains open, as it has been classified as an "essential business", the company is experiencing significant customer requests to delay shipments. These requests reflect that customers are not in their business locations to accept the shipments due to government mandated business shutdowns in the and many other countries. As these materials have historically been viewed as critical content by law firms and government agencies, the company currently expects most of these shipments will eventually take place. As such, the company believes that most of the second-quarter revenue loss will be recouped in the third and fourth quarters if the economy gradually re-opens and stabilizes. Full-year revenues for Global Print are expected to decline between 7%-11%.$35 millionMinnesotaU.S.

Adjusted EBITDA decreased 15% to .$63 million

Corporate Costs

 at the adjusted EBITDA level were compared to in the prior-year period. The decline reflects the completion of the company's program in 2019 to reposition Thomson Reuters following the separation of F&R, which required significant costs and investments.Corporate costs$33 million$132 million

Updated Business Outlook for 2020

Thomson Reuters today updated its full-year outlook for 2020. The company originally communicated a 2020 full-year business outlook in . Since the middle of March, the global economy has experienced unprecedented disruption due to the COVID-19 pandemic.  Given the uncertainty about the duration and impact of the crisis, it is still too early to predict how and when world markets may recover.February 2020

Thomson Reuters has updated its outlook based on its current view, and the company expects to provide another update with the release of its second-quarter results. In addition, the company provided a new full-year 2020 outlook for its "Big 3" segments (Legal Professionals, Corporates and Tax & Accounting Professionals) for total revenue growth, organic revenue growth and adjusted EBITDA margin.

The updated outlook assumes diminished economic activity through the second quarter followed by a gradual recovery through the second half of 2020. The updated outlook also assumes the financial and operational health of the company's customer base in both the and global economies will gradually improve, which the company believes will coincide with the easing of lockdowns and other restrictions.U.S.

The company utilized three scenarios to update its outlook.  The three scenarios assume the gradual economic improvement will begin in , and .  The company's updated outlook was derived by taking the mid-point of the and scenarios.July 2020October 2020January 2021July 2020October 2020

The updated outlook also assumes that the company will be able to mitigate the impact of anticipated lower 2020 revenues through its cost reduction program. While the company believes it will still generate strong free cash flow, it has lowered its free cash flow forecast to approximately for the full-year 2020. The lower free cash flow guidance assumes lower revenues and temporary delays in collecting payments from some customers, but the company believes this cash will be collected as the economy improves.$100 million$1.0 billion

The company's updated outlook for 2020 continues to assume constant currency rates and excludes the impact of any future acquisitions or dispositions that may occur in 2020. Thomson Reuters believes that this type of guidance provides useful insight into the performance of its businesses. 

Second-Quarter 2020 Outlook (New)

Total company revenues for the second quarter of 2020 are expected to decline between 1% and 2% and organic revenues are expected to decline between 2% and 3%, primarily due to cancellations of events in the business and delays in shipping of certain Global Print materials.Reuters News

The company's "Big 3" segments (Legal Professionals, Corporates and Tax & Accounting Professionals) collectively are expected to achieve revenue growth between 2.5% and 3.5% and organic revenue growth between 2% and 3% in the second quarter of 2020.

Full-Year 2020 Outlook

   

The information in this section is forward-looking. Actual results, which include the impact of currency and acquisitions and dispositions completed during 2020, may differ materially from the company's outlook. Some of the forward-looking financial measures in the outlook above are provided on a non-IFRS basis. See the section below entitled "Non-IFRS Financial Measures" for more information. The information in this section should also be read in conjunction with the section below entitled "Special Note Regarding Forward-Looking Statements, Material Risks and Material Assumptions."

Thomson Reuters Response to COVID-19: Supporting Employees, Customers and Communities

Liquidity and Capital Resources; Dividend and Share Repurchases

Thomson Reuters principal sources of liquidity continue to be cash on hand, cash provided by its operations, its syndicated credit facility and its commercial paper program. As set forth in the company's updated full-year 2020 outlook, Thomson Reuters expects to generate approximately of free cash flow this year. As of , Thomson Reuters had of cash on hand. As the economic crisis began to emerge, the company borrowed under its credit facility in the first quarter of 2020 primarily to repay commercial paper, but also as a precautionary measure given the economic uncertainty caused by the COVID-19 pandemic. Amounts borrowed under the credit facility are not due until 2024 although the company may consider replacing some of these borrowings with longer term debt in the near term. As of , the company had of outstanding commercial paper. $1.8 billion$1.8 billion$1.0 billion$823 million$1.0 billion$120 millionMarch 31, 2020March 31, 2020

Thomson Reuters does not have debt securities maturing until 2023. Its net debt to adjusted EBITDA leverage ratio as of was approximately 2.1x, which is lower than the company's target of 2.5x. As calculated under its credit facility covenant, the company's net debt to adjusted EBITDA leverage ratio was 1.9:1, well below the allowed maximum of 4.5x.March 31, 2020

The company does not anticipate any changes to its plans to pay the annualized dividend. In , the company announced that its Board of Directors approved a per share annualized increase in the dividend to per common share (representing the 27 consecutive year of dividend increases). A quarterly dividend of per share is payable on to common shareholders of record as of .February 2020June 15, 2020May 21, 2020$0.08$1.52$0.38th

In , the company announced that it planned to repurchase up to an additional of its common shares under its normal course issuer bid in 2020. These repurchases were completed in and the company does not anticipate repurchasing more of its shares in the near term. October 2019February 2020$200 million

The company believes that its existing sources of liquidity, cash on hand, cash generated from operations and funds available from its credit and commercial paper facilities, will be sufficient to fund its projected cash requirements for the next 12 months.

Refinitiv Ownership Interest and Proposed Sale to LSEG

On , the company sold a 55% interest in its F&R business to private equity funds affiliated with . Thomson Reuters retained a 45% interest in the business, which is now known as Refinitiv. Thomson Reuters includes its share of post-tax losses from its 45% interest in Refinitiv, an equity method investment, in its net earnings, however, it removes these amounts from its non-IFRS calculation of adjusted EPS. Refinitiv achieved run-rate savings of as of . Refinitiv believes it is on track to achieve its full annual cost savings run-rate target of by the end of 2020. Additional information regarding Refinitiv's financial results is provided in the appendix to this news release.October 1, 2018March 31, 2020Blackstone$538 million$650 million

On , Thomson Reuters and private equity funds affiliated with Blackstone agreed to sell Refinitiv to LSEG in an all share transaction for a total enterprise value of approximately (as of the announcement date). The proposed transaction is subject to regulatory clearances and other customary closing conditions and is expected to close in the second half of 2020. Upon the closing of this transaction, Thomson Reuters is projected to indirectly own approximately 82.5 million LSEG shares, which would have a market value of approximately .6 billion based on LSEG's closing share price on . August 1, 2019May 4, 2020$27 billion$7

Thomson Reuters

Thomson Reuters is a leading provider of business information services. Our products include highly specialized information-enabled software and tools for legal, tax, accounting and compliance professionals combined with the world's most global news service – Reuters. For more information on Thomson Reuters, visit  and for the latest world news, . tr.comreuters.com

NON-IFRS FINANCIAL MEASURES

Thomson Reuters prepares its financial statements in accordance with International Financial Reporting Standards (IFRS), as issued by the (IASB).International Accounting Standards Board

This news release includes certain non-IFRS financial measures, such as adjusted EBITDA and the related margin (other than at the customer segment level), net debt to adjusted EBITDA leverage ratio, free cash flow, adjusted EPS, selected measures excluding the impact of foreign currency, and changes in revenues computed on an organic basis. Thomson Reuters uses these non-IFRS financial measures as supplemental indicators of its operating performance and financial position. These measures do not have any standardized meanings prescribed by IFRS and therefore are unlikely to be comparable to the calculation 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 defined and 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 misleading and 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 to reconcile these non-IFRS measures to the most comparable IFRS measures because it cannot predict, with reasonable certainty, the 2020 impact of changes in foreign 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, the company cannot reasonably predict the occurrence or amount of other operating gains and losses, which include fair value adjustments relating to the warrants the company holds in Refinitiv as well as gains or 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 of 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 to rounding.U.S.

ADJUSTMENTS TO PRIOR-PERIOD SEGMENT RESULTS

The company adjusted its prior-period segment amounts to reflect the current presentation. In the first quarter of 2020, in connection with the completion of its program to reposition its businesses after the separation from Refinitiv, the company re-assessed its methodology for allocating costs to its business segments and adjusted its allocations. For comparative purposes, the prior period of 2019 was adjusted to reflect the current methodology, with the effect of increasing adjusted EBITDA for by and decreasing adjusted EBITDA for the Corporates segment by the same amount. The other customer segments reflected minor adjustments to adjusted EBITDA. Additionally, the 2019 segment amounts were adjusted to reflect the transfer of of revenues from the Corporates segment to the Legal Professionals segment, where they are better aligned. These changes impacted the 2019 financial results of the segments, but did not change consolidated 2019 financial results.Reuters News$7 million$6 million

REVISION OF PRIOR-PERIOD FINANCIAL STATEMENTS

Since , the company has included its share of post-tax losses from its 45% interest in Refinitiv, an equity method investment, in its net earnings. As initially disclosed by the company on , a misstatement was identified in the third quarter of 2019 that understated the company's share of Refinitiv's post-tax losses since the fourth quarter of 2018.  The misstatement related to an accounting principle difference for preferred stock issued by Refinitiv to the consortium between GAAP, the basis on which Refinitiv prepares its financial statements, and IFRS, the basis on which Thomson Reuters prepares its financial statements. The misstatement, which does not impact revenue, operating profit, segment measures, adjusted EBITDA, adjusted EPS, cash flow from operations or free cash flow, was immaterial to the company's previously issued financial statements.  As the correction of the cumulative misstatement in the third quarter of 2019 would have been material to net earnings in the quarter, the company revised its previously issued financial statements. In conjunction with correcting this misstatement, the company corrected other unrelated misstatements in the applicable prior periods which were also not material to the company's previously issued financial statements.October 1, 2018October 31, 2019BlackstoneU.S.

The company revised its previously issued financial statements for the nine months ended , the year ended , the three months ended and the six months ended .  September 30, 2018December 31, 2018March 31, 2019June 30, 2019

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS, MATERIAL RISKS AND MATERIAL ASSUMPTIONS

Certain statements in this news release, including, but not limited to, statements in the "Updated Business Outlook for 2020" section, statements regarding the potential or expected impact of the COVID-19 pandemic on Thomson Reuters, its customers and the general economy, comments, the company's expectations regarding dividends, share repurchases and its liquidity and capital resources, the number of LSEG shares that Thomson Reuters is projected to indirectly own upon closing of the proposed sale of Refinitiv, the company's current expectations regarding the timing for closing of the proposed LSEG/Refinitiv transaction, and Refinitiv's belief regarding achieving its full annual cost savings run-rate target by the end of 2020, are forward-looking. The words "will", "expect", "believe", "target", "estimate", "could", "should", "intend", "predict", "project" and similar expressions 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 no assurance that the proposed LSEG/Refinitiv transaction will be completed or that any of the other events described in any forward-looking statement will materialize. Forward-looking statements, including those related to the COVID-19 pandemic, are subject to a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially 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. In particular, the full extent of the impact of the COVID-19 pandemic on the company's business, operations and financial results will depend on numerous evolving factors that it may not be able to accurately predict.Mr. Hasker's

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 in this news release include, but are not limited to, the ongoing impact of the COVID-19 pandemic on the company's business and risks that the pandemic could have a longer duration or a more significant impact on Thomson Reuters than the company currently expects; changes in the general economy (including the impact of the pandemic on the and global economies); actions of competitors; fraudulent or unpermitted data access or other cyber-security or privacy breaches; failures or disruptions of data centers, network systems, telecommunications, or the Internet; failure to develop new products, services, applications and functionalities to meet customers' needs, attract new customers and retain existing ones, or expand into new geographic markets and identify areas of higher growth; changes to law and regulations; failure to adapt to organizational changes and effectively implement strategic initiatives; failure to attract, motivate and retain high quality management and key employees; failure to derive fully the anticipated benefits from existing or future acquisitions, joint ventures, investments or dispositions; failure to meet the challenges involved in operating globally; failure to maintain a high renewal rate for recurring, subscription-based services; dependency on third parties for data, information and other services; inadequate protection of intellectual property rights; tax matters, including changes to tax laws, regulations and treaties; fluctuations in foreign currency exchange and interest rates; failure to protect the brands and reputation of Thomson Reuters; threat of legal actions and claims; downgrading of credit ratings and adverse conditions in the credit markets; failure to efficiently complete the separation of Refinitiv from Thomson Reuters; failure to complete the proposed LSEG/Refinitiv transaction; the effect of factors outside of the control of Thomson Reuters on funding obligations in respect of pension and post-retirement benefit arrangements; risk of antitrust/competition-related claims or investigations; actions or potential actions that could be taken by the company's principal shareholder, The ; impairment of goodwill and other identifiable intangible assets; and the ability of to affect the company's governance and management. Many of the foregoing risks are, and could be, exacerbated by the COVID-19 pandemic and any worsening of the global business and economic environment as a result. These and other risk factors are discussed in materials that Thomson Reuters from time to time files with, or furnishes to, the Canadian securities regulatory authorities and the . Thomson Reuters annual and quarterly reports are also available in the "Investor Relations" section ofU.S.Woodbridge Company LimitedThomson Reuters Founders Share CompanyU.S. Securities and Exchange Commission.www.thomsonreuters.com

The company's updated 2020 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, current conditions and expected future developments (including those related to the COVID-19 pandemic), 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's expectations underlying its updated 2020 business outlook, which reflects the global economic crisis caused by the COVID-19 pandemic. Material assumptions related to the company's revenue outlook are that there will be diminished economic activity through the second quarter followed by a gradual recovery through the second half of 2020; the financial and operational health of the company's customer base in both the and global economies will gradually improve, which the company believes will coincide with the easing of lockdowns and other restrictions; the company will incur limited cancellations of subscription contracts during the economic crisis, as its products and services will remain critical for legal and tax professionals; during the extended work from home period, Thomson Reuters' customers will continue to access the company's products remotely and will value high quality information and tools that drive productivity and efficiency; the company will maintain its ability to acquire some new customers during the economic crisis, as it enhances its digital platforms and propositions or through other sales initiatives; will experience a significant reduction in demand in its Reuters Events business due to the cancellation of in-person events, as well as lower demand in its consumer and news agency business; Thomson Reuters' workforce will continue to be effective in a remote working environment for an extended period, including the ability to implement new products and service and support existing products for the company's customers; the company's Global Print facility will continue to remain open and its journalists will continue to be able to report on global events; customer requested shipment delays of print materials will be temporary and will peak in the second quarter and most delayed shipments will resume in the third and fourth quarters of 2020; related to customer use of Tax & Accounting Professionals' products, the original filing deadline for federal income tax returns is not further extended beyond and the segment's estimated tax product usage for the second quarter compared to the third quarter does not materially vary from expectations; a limited number of Thomson Reuters' smaller customers will be unable to pay the company or will seek financial accommodations or alternative payment terms due to their financial condition; and customers will continue to seek software-as-a-service or other cloud-based offerings. Material assumptions related to the company's adjusted EBITDA margin outlook are its ability to achieve revenue growth targets; the company's business mix continues to shift to higher-growth product offerings; continued investment in growth markets, customer service, product development and digital capabilities; and the company will be able to mitigate a significant portion of the impact of lost revenues on adjusted EBITDA margin through its cost savings programs, including reduced spending on consulting and advisory services, travel and entertainment, certain development initiatives and other discretionary spend. Material assumptions related to the company's free cash flow outlook are its ability to achieve its revenue and adjusted EBITDA margin targets; capital expenditures are expected to be approximately between 7.5% to 8.0% of revenues in 2020; a limited number of Thomson Reuters' smaller customers will be unable to pay the company or will seek financial accommodations or alternative payment terms due to their financial condition; and deferrals of payments from customers will be limited, and the company's access to credit facilities will be sufficient to bridge any gap. Material assumptions related to the company's effective tax rate on adjusted earnings outlook are its ability to achieve its adjusted EBITDA target; the mix of taxing jurisdictions where the company recognized pre-tax profit or losses in 2019 does not significantly change; no unexpected changes in tax laws or treaties within the jurisdictions where the company operates; the completion of the proposed sale of Refinitiv to LSEG or the sale of another significant, but non-strategic, equity investment at a significant gain in the second half of 2020; depreciation and amortization of computer software between and ; and interest expense between and .U.S.U.S.Reuters NewsReuters NewsApril 15, 2020July 15, 2020$625 million$650 million$190 million$215 million

.Material risks related to the company's revenue outlook are that business disruptions associated with the COVID-19 pandemic, including government enforced quarantines and stay-at-home orders, may continue longer than the company expects or may be interrupted by secondary outbreaks of the virus, delaying the anticipated recovery of the global economy; global economic uncertainty due to the COVID-19 pandemic as well as related regulatory reform and changes in the political environment may lead to limited business opportunities for the company's customers, creating significant cost pressures for them and potentially constraining the number of professionals employed, which could lead to lower demand for Thomson Reuters' products and services; competitive pricing actions and product innovation could impact the company's revenues; the company's sales, commercial simplification and product initiatives may be insufficient to retain customers or generate new sales; factors that the company cannot anticipate may reduce the effectiveness of its employees working remotely, including the inability to execute on key product or customer support initiatives or to perform implementation services remotely; factors that the company cannot anticipate may require it to suspend or cease operations at its Global Print facility or may limit the ability of journalists to report on certain global events; a decline in Global Print revenues may be larger than the company anticipates if customers do not resume shipments because they are not able to return to their business locations or for other reasons; and the expected seasonality of the company's second-quarter revenues and profit, in particular Tax & Accounting Professionals' results, could be further adversely impacted if the filing deadline for federal income tax returns is further extended beyond or if more tax product usage, which historically peaks around filing deadlines, occurs in the third quarter than expectedReuters NewsU.S.U.S.July 15, 2020Material risks related to the company's adjusted EBITDA margin outlook are the same as the risks above related to the revenue outlook; the costs of required investments exceed expectations or actual returns are below expectations; acquisition and disposal activity may dilute the company's adjusted EBITDA margin; and the company's cost savings programs may be insufficient to offset lost revenues. Material risks related to the company's free cash flow outlook are the same as the risks above related to the revenue and adjusted EBITDA margin outlook; capital expenditures may be higher than currently expected resulting in higher cash outflows; the timing and amount of tax payments to governments may differ from the company's expectations; a significant deterioration in the macroeconomic environment could negatively impact the ability of Thomson Reuters' customers to pay the company leading to reduced free cash flow and the tightening of credit markets could limit the company's ability to bridge gaps in payments leading to unexpected operational impacts on its business. Material risks related to the company's effective tax rate on adjusted earnings outlook are the same as the risks above related to adjusted EBITDA; a material change in the geographical mix of the company's pre-tax profits and losses; a material change in current tax laws or treaties to which the company is subject, and did not expect; the tax rates and calculations that apply to the company's taxable income could be impacted if the transactions described in the material assumptions for the effective tax rate on adjusted earnings outlook do not occur; and depreciation and amortization of computer software as well as interest expense may be significantly higher or lower than expected.

The company has provided an updated Outlook for the purpose of presenting information about current expectations for 2020. This information may not be appropriate 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, including those related to the COVID-19 pandemic.

CONTACTS

Thomson Reuters will webcast a discussion of its first-quarter 2020 results and updated business outlook for 2020 today beginning at (EDT). You can access the webcast by visiting . An archive of the webcast will be available following the presentation.8:30 a.m. Eastern Daylight Timeir.thomsonreuters.com

   

   

   

   

   

   

   

   

   

APPENDIX – INFORMATION ABOUT REFINITIV

Thomson Reuters owns a 45% interest in Refinitiv, which was formerly its wholly owned F&R business. 55% of Refinitiv is owned by private equity funds affiliated with . Thomson Reuters IFRS results include the company's 45% share of Refinitiv's results reported in a single line item on the company's consolidated income statement titled "Share of post-tax losses in equity method investments." Thomson Reuters non-IFRS measures, including adjusted earnings, exclude its share of post-tax results in Refinitiv and other equity method investments.Blackstone

The table below sets forth selected financial information for 100% of Refinitiv for the three months ended and 2019 on both an IFRS and non-IFRS basis. Refinitiv reports on a US GAAP basis and provides a reconciliation to IFRS in accordance with Thomson Reuters accounting policies. A reconciliation from these IFRS measures to the related non-IFRS measures is also included in this appendix.March 31, 2020

The following reconciliations of IFRS measures to non-IFRS measures are based on Refinitiv's definition of non-GAAP measures, which is not the same as the definitions used by Thomson Reuters.

   

Three Months Ended March 31,
(Millions of  dollars, except for adjusted EBITDA margin and
                              EPS)
                          (unaudited)

IFRS Financial Measures (1)        2020 2019(2) Change Change at
                                                       Constant
                                                       Currency

Revenues                              2%

Operating profit                          6%

Diluted earnings per share (EPS)       95%

Cash flow from operations               n/m

Non-IFRS Financial Measures (1)

Revenues                              2%      3%

Adjusted EBITDA                          21%      22%

Adjusted EBITDA margin            31.6%   26.7% 490bp    480bp

Adjusted EPS                           33%      36%

Free cash flow                          n/m

n/m: not meaningful

(1) In addition to results reported in accordance with
International Financial Reporting Standards (IFRS), the company
uses certain non-IFRS financial measures as supplemental
indicators of its operating performance and financial position.
These and other non-IFRS financial measures are defined and
reconciled to the most directly comparable IFRS measures in the
tables appended to this news release.
(2) 2019 results have been revised to correct for certain
immaterial misstatements. For additional information, see the
"Revision of Prior-Period Financial Statements" section of this
news release.U.S.$1,520$1,487$290$274$0.39$0.20$176$(30)$1,520$1,487$480$397$0.48$0.36$35$(177)
--  Organic revenue growth was 2%, driven by 4% growth in recurring
        revenues, which comprised 77% of total revenues. The company's "Big 3"
        segments (Legal Professionals, Corporates and Tax & Accounting
        Professionals), which collectively comprised approximately 80% of
        first-quarter revenues, reported organic revenue growth of 4%.
--  Adjusted EBITDA, which excludes the impact of the warrant revaluation
        among other items, increased 21%, reflecting the completion of the F&R
        separation program, which required significant costs and investments in
        the prior-year period. The related margin increased to 31.6% compared to
        26.7% in the prior-year period.
--  Adjusted EPS, which excludes the company's equity interest in Refinitiv,
        the currency revaluation benefits as well as other adjustments,
        increased to  from  in the prior-year period, primarily due to
        higher adjusted EBITDA.$0.48$0.36
--  Free cash flow increased for the same reason.
(Millions of  dollars, except for adjusted EBITDA margins)
                                (unaudited)

                            Three Months Ended

                                March 31,                  Change

                              2020    2019 (1)   Total  Constant Organic (2)
                                                        Currency

Revenues

Legal Professionals                          4%       5%          4%

Corporates                     367         346       6%       7%          5%

Tax & Accounting               218         222      -2%       0%          0%
Professionals

"Big 3" Segments Combined    1,211       1,168       4%       5%          4%

Reuters News                   155         155       0%       0%         -4%

Global Print                   155         165      -6%      -5%         -5%

Eliminations/Rounding          (1)         (1)

Revenues                                 2%       3%          2%

Adjusted EBITDA

Legal Professionals                          0%       1%

Corporates                     117         111       5%       5%

Tax & Accounting                84          92      -8%      -6%
Professionals

"Big 3" Segments Combined      431         432       0%       1%

Reuters News                    19          23     -14%     -27%

Global Print                    63          74     -15%     -15%

Corporate costs               (33)       (132)      n/a      n/a

Adjusted EBITDA                             21%      22%

Adjusted EBITDA Margin

Legal Professionals          36.7%       38.1%   -140bp   -130bp

Corporates                   31.9%       32.1%    -20bp    -60bp

Tax & Accounting             38.7%       41.4%   -270bp   -290bp
Professionals

"Big 3" Segments Combined    35.6%       37.0%   -140bp   -140bp

Reuters News                 12.6%       14.6%   -200bp   -400bp

Global Print                 40.5%       44.7%   -420bp   -450bp

Corporate costs                n/a         n/a      n/a      n/a

Adjusted EBITDA margin       31.6%       26.7%    490bp    480bp

n/a: not applicable
(1) For comparative purposes, 2019 segment results have been adjusted to
reflect the current period presentation. For additional information, see the
"Adjustments to Prior-Period Segment Results" section of this news release.
(2) Computed for revenue growth only.U.S.$626$600$1,520$1,487$230$229$480$397
--  Recurring revenues grew 6% (94% of total), driven by organic revenue
        growth of 5% and strong growth from HighQ, which was acquired in .
    --  Transactions revenues declined 11% (6% of total) due to the sale of
        several small businesses in 2019 and declined 5% organically.July
        2019
--  The margin decreased to 36.7% from 38.1%, primarily due to the dilutive
        impact of the HighQ acquisition and timing of expenses.
--  Recurring revenues grew 8% (77% of total), driven by organic revenue
        growth of 7% and revenues from the acquisition of HighQ.
    --  Transactions revenues grew 4% (23% of total), as revenues from the
        acquisition of Confirmation more than offset the loss of revenues
        following the sale of the /Legal Managed Services business.
        Transactions revenues declined 2% organically.Pangea3
--  The margin decreased from 32.1% to 31.9% reflecting slightly higher
        expenses.
--  Recurring revenues declined 7% (72% of total), driven by an organic
        revenue decline of 1%, due to the acceleration of UltraTax software
        releases and by the loss of revenues from the sale of the segment's
        Government business in .
    --  Transactions revenues grew 26% (28% of total), primarily due to revenues
        contributed by Confirmation. Transactions revenues grew 3% organically.November 2019
--  The margin decreased from 41.4% to 38.7% due to the UltraTax revenue
        timing.
    --  The Tax & Accounting Professionals segment is the company's most
        seasonal business with nearly 60% of full-year revenues typically
        generated in the first and fourth quarters. Because of this, the margin
        performance in this segment historically has been generally higher in
        the first and fourth quarters as costs historically have been incurred
        in a more linear fashion throughout the year.
--  Nearly all of Reuters Events in-person conferences have been postponed
        through , which is expected to result in lost revenues of
        approximately  in the second quarter, or about 50% of Reuters
        Events expected full-year revenues. The Reuters Events business could
        forgo an additional  of revenues in the fourth quarter of
        2020 if it is unable to resume in-person conferences.
    --   full-year 2020 revenues are expected to decline between 4%
        and 6%.August 2020$25 million$15 millionReuters News
--  The margin decreased from 44.7% to 40.5% due to the decline in revenues.
Total Thomson Reuters        Original 2020 Outlook      Updated
                                      (Communicated on       2020 Outlook
                                     February 25, 2020)

                                    Before currency and excluding the impact
                                                    of future
                                            acquisitions/dispositions

       Total Revenue Growth              4.5% - 5.5%          1.0% - 2.0%

      Organic Revenue Growth             4.0% - 4.5%           0% - 1.0%

      Adjusted EBITDA Margin            31.5% – 32.0%        31.0% – 32.0%

          Corporate Costs             -        Unchanged

          Free Cash Flow                .2+ billion        

Capital Expenditures - % of Revenue      7.5% - 8.0%           Unchanged

  Depreciation & Amortization of      -        Unchanged
         

      Interest Expense (P&L)          -    - 

  Effective Tax Rate on Adjusted      Approx. 17% - 19%        Unchanged
             Earnings$140$150 million$1~$1.0 billion$625$650 million$175$200 million$190$215 millionComputer Software
"Big 3" – Legal Professionals,               2020 Outlook
      Corporates and Tax
  & Accounting Professionals

                               Before currency and excluding the impact
                                              of future
                                      acquisitions/dispositions

     Total Revenue Growth                    3.0% - 4.0%

    Organic Revenue Growth                   3.0% - 4.0%

    Adjusted EBITDA Margin                  36.0% - 37.0%
--  Thomson Reuters main priority has been the health and safety of its
        employees and the company's actions have been driven by local health
        authority directions and government mandates and guidelines. The company
        is currently operating its business with approximately 98% of its
        employees working remotely from their homes. In parts of , the
        company is beginning a gradual phased return to work in the office.
        Staff returning to Thomson Reuters offices and essential employees
        around the world who are not working from home, such as 
        journalists and those running the company's print facilities, follow
        social distancing and cleaning protocols. The company has also expanded
        its health and welfare programs to help employees during the crisis and
        has transitioned recruiting, onboarding and training of new employees to
        a virtual experience. Thomson Reuters created a dedicated site for its
        employees on the company intranet to serve as a focal point for COVID-19
        related information, including updated company policies and Q&As, in
        multiple languages. Technology utilized across the company has allowed
        Thomson Reuters employees to continue to collaborate with customers and
        among themselves regardless of where they are in the world, with
        relatively little disruption.
    --  Thomson Reuters has approximately 500,000 customers that are largely
        comprised of legal and tax professionals in corporations and
        professional services firms. The  Federal Government is Thomson
        Reuters largest customer and comprised approximately 2% of its 2019
        revenues. As the company's customers can access most Thomson Reuters
        products and services remotely and through the Internet, the company has
        been able to help legal and tax professionals remain productive during
        the period that they work from home. Levels of product usage by
        customers remains high and the company remains focused on supporting
        customers who are also working in new operating environments by
        maintaining timely responsiveness in call centers and continuing to
        implement products into their infrastructures remotely. Thomson Reuters
        believes that COVID-19 may result in more lawyers and accountants
        accelerating their transformation to more technology-driven models on
        which the company's products are built, given the changes that they are
        experiencing in working remotely.
    --  Thomson Reuters relies on a global network of suppliers, including third
        party service providers for telecommunications, as well as other
        services that the company has outsourced, such as certain accounting
        services, human resources administrative functions, facilities
        management and IT services. Most of Thomson Reuters' suppliers have also
        been impacted by the COVID-19 pandemic and many of them are also working
        from home. Thomson Reuters has not experienced any significant COVID-19
        related supplier disruptions or issues as of the date of this news
        release.
    --  The company believes that its  journalists are delivering
        outstanding global reporting on COVID-19. In direct response to
        COVID-19, Thomson Reuters legal and tax editorial staff launched a
        COVID-19 resource center to support customers with free resources
        regarding emerging regulatory guidance. Additionally, Thomson Reuters
        court case management team is working to establish virtual court
        hearings in selected locations to enable court operations that otherwise
        would have ceased to continue. Thomson Reuters Government business
        leveraged its investigative analytic skills to help the  government
        prevent distribution of counterfeit COVID-19 testing kits and other
        unlicensed medical equipment.AsiaU.S.U.S.Reuters NewsReuters News
MEDIA                     INVESTORS
           
Head of Corporate Affairs Head of Investor Relations
+44 7909 898 605          +1 646 223 5288David CrundwellFrank J. Goldendavid.crundwell@tr.comfrank.golden@tr.com
Thomson Reuters Corporation
                         Consolidated Income Statement
               (millions of U.S. dollars, except per share data)
                                  (unaudited)

                                                           Three Months Ended

                                                                March 31,

                                                                2020        2019

CONTINUING OPERATIONS

Revenues                                                            

Operating expenses                                           (1,017)     (1,091)

Depreciation                                                    (40)        (34)

Amortization of computer software                              (111)       (105)

Amortization of other identifiable intangible assets            (30)        (27)

Other operating (losses) gains, net                             (32)          44

Operating profit                                                 290         274

Finance costs, net:

Net interest expense                                            (45)        (35)

Other finance income (costs)                                      47        (11)

Income before tax and equity method investments                  292         228

Share of post-tax losses in equity method investments           (54)       (113)

Tax expense                                                     (47)         (1)

Earnings from continuing operations                              191         114

Earnings (loss) from discontinued operations, net of tax           2        (10)

Net earnings                                                            

Earnings attributable to common shareholders                            

Earnings (loss) per share:

Basic earnings (loss) per share:

From continuing operations                                            

From discontinued operations                                    0.01      (0.02)

Basic earnings per share                                              

Diluted earnings (loss) per share:

From continuing operations                                            

From discontinued operations                                    0.01      (0.02)

Diluted earnings per share                                            

Basic weighted-average common shares                     496,205,027 501,888,688

Diluted weighted-average common shares                   498,145,078 503,649,290$1,520$1,487$193$104$193$104$0.38$0.23$0.39$0.21$0.38$0.22$0.39$0.20
Thomson Reuters Corporation
            Consolidated Statement of Financial Position
                     (millions of U.S. dollars)
                            (unaudited)

                                             March 31,  December 31,

                                               2020         2019

Assets

Cash and cash equivalents                                   

Trade and other receivables                      1,120         1,167

Other financial assets                             441           533

Prepaid expenses and other current assets          558           546

Current assets                                   2,942         3,071

Property and equipment, net                        591           615

Computer software, net                             901           900

Other identifiable intangible assets, net        3,476         3,518

Goodwill                                         5,823         5,853

Equity method investments                        1,387         1,551

Other non-current assets                           639           611

Deferred tax                                     1,157         1,176

Total assets                                          

Liabilities and equity

Liabilities

Current indebtedness                                      

Payables, accruals and provisions                1,143         1,373

Deferred revenue                                   780           833

Other financial liabilities                        131           434

Current liabilities                              3,175         3,219

Long-term indebtedness                           2,676         2,676

Provisions and other non-current liabilities     1,317         1,264

Deferred tax                                       512           576

Total liabilities                                7,680         7,735

Equity

Capital                                          5,385         5,377

Retained earnings                                4,934         4,965

Accumulated other comprehensive loss           (1,083)         (782)

Total equity                                     9,236         9,560

Total liabilities and equity$823$825$16,916$17,295$1,121$579$16,916$17,295
Thomson Reuters Corporation
                     Consolidated Statement of Cash Flow
                         (millions of U.S. dollars)
                                 (unaudited)

                                                                 Three Months
                                                                    Ended
                                                                  March 31,

                                                                  2020   2019

Cash provided by (used in):

Operating activities

Earnings from continuing operations                                  

Adjustments for:

Depreciation                                                        40     34

Amortization of computer software                                  111    105

Amortization of other identifiable intangible assets                30     27

Net losses (gains) on disposals of businesses and investments        3   (24)

Deferred tax                                                       (3)   (68)

Other                                                               62    144

Pension contribution                                                 -  (167)

Changes in working capital and other items                       (243)  (138)

Operating cash flows from continuing operations                    191     27

Operating cash flows from discontinued operations                 (15)   (57)

Net cash provided by (used in) operating activities                176   (30)

Investing activities

Acquisitions, net of cash acquired                               (124)    (4)

(Payments) proceeds from disposals of businesses and investments   (3)     34

Capital expenditures                                             (142)  (138)

Proceeds from disposals of property and equipment                   19      -

Other investing activities                                           1      3

Investing cash flows from continuing operations                  (249)  (105)

Investing cash flows from discontinued operations                    -     29

Net cash used in investing activities                            (249)   (76)

Financing activities

Proceeds from debt                                               1,020      -

Repayments of debt                                               (645)      -

Net borrowings under short-term loan facilities                    118      -

Payments of lease principal                                       (18)   (11)

Repurchases of common shares                                     (200)  (190)

Dividends paid on preference shares                                (1)    (1)

Dividends paid on common shares                                  (182)  (174)

Other financing activities                                        (12)     35

Net cash provided by (used in) financing activities                 80  (341)

Increase (decrease) in cash and bank overdrafts                      7  (447)

Translation adjustments                                           (10)      2

Cash and bank overdrafts at beginning of period                    825  2,703

Cash and bank overdrafts at end of period                          

Cash and bank overdrafts at end of period comprised of:

Cash and cash equivalents                                          

Bank overdrafts                                                    (1)      -$191$114$822$2,258$823$2,258$822$2,258
Thomson Reuters Corporation

 Reconciliation of Earnings from Continuing Operations to Adjusted
                             EBITDA(1)

           (millions of  dollars, except for margins)

                            (unaudited)

                                                         Three
                                                        Months
                                                         Ended

                                                       March 31,

                                                       2020  2019

Earnings from continuing operations                      

Adjustments to remove:

Tax expense                                              47     1

Other finance (income) costs                           (47)    11

Net interest expense                                     45    35

Amortization of other identifiable intangible assets     30    27

Amortization of computer software                       111   105

Depreciation                                             40    34

EBITDA                                                   

Adjustments to remove:

Share of post-tax losses in equity method investments    54   113

Other operating losses (gains), net                      32  (44)

Fair value adjustments                                 (23)     1

Adjusted EBITDA                                          

Adjusted EBITDA margin(1)                             31.6% 26.7%U.S.$191$114$417$327$480$397
Thomson Reuters Corporation

          Reconciliation of Net Earnings to Adjusted Earnings(2)

   Reconciliation of Total Change in Adjusted EPS to Change in Constant
                                Currency(4)

      (millions of  dollars, except for share and per share data)

                                (unaudited)

                                                            Three
                                                           Months
                                                            Ended

                                                          March 31,

                                                          2020  2019 Change

Net earnings                                                

Adjustments to remove:

Fair value adjustments                                    (23)     1

Amortization of other identifiable intangible assets        30    27

Other operating losses (gains), net                         32  (44)

Other finance (income) costs                              (47)    11

Share of post-tax losses in equity method investments       54   113

Tax on above items                                        (31)  (29)

Tax items impacting comparability                           30  (11)

(Earnings) loss from discontinued operations, net of tax   (2)    10

Interim period effective tax rate normalization(3)           4     -

Dividends declared on preference shares                    (1)   (1)

Adjusted earnings(2)                                        

Adjusted EPS(2)                                               33%

Foreign currency(4)                                                     -3%

Constant currency(4)                                                    36%

Diluted weighted-average common shares (millions)        498.1 503.6

Refer to page 19 for footnotes.U.S.$193$104$239$181$0.48$0.36
Thomson Reuters Corporation

   Reconciliation of Net Cash Provided By (Used In) Operating
                Activities to Free Cash Flow(5)

                   (millions of U.S. dollars)

                          (unaudited)

                                                    Three Months
                                                       Ended

                                                     March 31,

                                                     2020   2019

Net cash provided by (used in) operating activities    

Capital expenditures                                (142)  (138)

Proceeds from disposals of property and equipment      19      -

Other investing activities                              1      3

Payments of lease principal                          (18)   (11)

Dividends paid on preference shares                   (1)    (1)

Free cash flow$176$(30)$35$(177)
Reconciliation of Net Debt and Leverage Ratio of Net Debt to Adjusted
                               EBITDA(7)

                       (millions of  dollars)

                              (unaudited)

                                                                  

Current indebtedness                                              

Long-term indebtedness                                             2,676

Total debt                                                         3,797

Remove transaction costs and discounts included in the carrying       35
value of debt

Add: lease liabilities                                               321

Less: cash and cash equivalents                                    (823)

Net debt                                                          

Adjusted EBITDA*                                                  

Net Debt / Adjusted EBITDA*                                         2.1x

* Our target leverage ratio of 2.5:1 is a non-IFRS measure. For purposes
of this calculation, adjusted EBITDA is computed on a rolling
twelve-month basis and includes adjusted EBITDA of , ,  and  for the three months ended , ,  and ,
respectively. Refer to the tables appended to this news release and
Appendix C of the company's 2019 annual management's discussions and
analysis, which is contained in the company's 2019 annual report, for
additional information regarding the calculation of adjusted EBITDA in
each of these periods.

Refer to page 19 for footnotes.Thomson Reuters CorporationU.S.March 31,
                                                                       2020March
31, 2020December 31, 2019September 30, 2019June 30, 2019$1,121$3,330$1,576$480 million$396
million$345 million$355 million
Thomson Reuters Corporation

Reconciliation of Changes in Revenues (Total, Recurring and Transactions) to Changes
             in Revenues on a Constant Currency(4) and Organic Basis(6)

                             (millions of U.S. dollars)

                                    (unaudited)

                       Three Months
                           Ended

                         March 31,                        Change

                         2020  2019*  Total          SUBTOTAL                Organic
                                             Foreign Constant  Acquisitions/
                                            Currency Currency (Divestitures)

Total Revenues

Legal Professionals              4%      -1%       5%             1%      4%

Corporates                367    346     6%      -1%       7%             2%      5%

Tax & Accounting          218    222    -2%      -2%       0%             1%      0%
Professionals

"Big 3" Segments        1,211  1,168     4%      -1%       5%             1%      4%
Combined

Reuters News              155    155     0%       0%       0%             4%     -4%

Global Print              155    165    -6%      -1%      -5%             0%     -5%

Eliminations/Rounding     (1)    (1)

Revenues                     2%      -1%       3%             1%      2%

Recurring Revenues

Legal Professionals              6%      -1%       6%             1%      5%

Corporates                281    263     7%      -1%       8%             1%      7%

Tax & Accounting          158    173    -9%      -2%      -7%            -5%     -1%
Professionals

"Big 3" Segments        1,026    992     3%      -1%       4%             0%      4%
Combined

Reuters News              142    143    -1%      -1%      -1%             0%     -1%

Total Recurring              3%      -1%       4%             0%      4%
Revenues

Transactions Revenues

Legal Professionals              -12%      -1%     -11%            -6%     -5%

Corporates                 86     83     3%      -1%       4%             6%     -2%

Tax & Accounting           60     49    24%      -1%      26%            22%      3%
Professionals

"Big 3" Segments          185    176     5%      -1%       6%             7%     -1%
Combined

Reuters News               13     12     9%       5%       4%            36%    -32%

Total Transactions               5%      -1%       6%            10%     -4%
Revenues

* For comparative purposes, 2019 segment results have been adjusted to reflect the
current period presentation. For additional information, see the "Adjustments to
Prior-Period Segment Results" section of this news release.

Growth percentages are computed using whole dollars. As a result, percentages
calculated from reported amounts may differ from those presented, and growth
components may not total due to rounding.

Refer to page 19 for footnotes.$626$600$1,520$1,487$587$556$1,168$1,135$39$44$198$188
Thomson Reuters Corporation

Reconciliation of Changes in Adjusted EBITDA to Changes on a Constant Currency
                                   Basis(4)

                          (millions of U.S. dollars)

                                 (unaudited)

                                 Three Months Ended

                                     March 31,                 Change

                                  2020        2019*    Total Foreign  Constant
                                                             Currency
                                                                      Currency

Adjusted EBITDA

Legal Professionals                               0%      -1%       1%

Corporates                         117          111       5%       0%       5%

Tax & Accounting Professionals      84           92      -8%      -2%      -6%

"Big 3" Segments Combined          431          432       0%      -1%       1%

Reuters News                        19           23     -14%      12%     -27%

Global Print                        63           74     -15%       0%     -15%

Corporate costs                   (33)        (132)      n/a      n/a      n/a

Adjusted EBITDA                                  21%      -1%      22%

Adjusted EBITDA Margin

Legal Professionals              36.7%        38.1%   -140bp    -10bp   -130bp

Corporates                       31.9%        32.1%    -20bp     40bp    -60bp

Tax & Accounting Professionals   38.7%        41.4%   -270bp     20bp   -290bp

"Big 3" Segments Combined        35.6%        37.0%   -140bp      0bp   -140bp

Reuters News                     12.6%        14.6%   -200bp    200bp   -400bp

Global Print                     40.5%        44.7%   -420bp     30bp   -450bp

Corporate costs                    n/a          n/a      n/a      n/a      n/a

Adjusted EBITDA margin           31.6%        26.7%    490bp     10bp    480bp

n/a: not applicable

* For comparative purposes, 2019 segment results have been adjusted to reflect
the current period presentation. For additional information, see the
"Adjustments to Prior-Period Segment Results" section of this news release.

Growth percentages and margins 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.

Refer to page 19 for footnotes.$230$229$480$397
Footnotes

(1) Thomson Reuters defines adjusted EBITDA for its business segments as
    earnings or losses from continuing operations before tax expense or benefit,
    net interest expense, other finance costs or income, depreciation,
    amortization of software and other identifiable intangible assets, Thomson
    Reuters share of post-tax earnings or losses in equity method investments,
    other operating gains and losses, certain asset impairment charges, fair
    value adjustments and corporate related items. Consolidated adjusted EBITDA
    is comprised of adjusted EBITDA for its business segments and corporate
    costs. Adjusted EBITDA margin is adjusted EBITDA expressed as a percentage
    of revenues. Thomson Reuters uses adjusted EBITDA because it provides a
    consistent basis to evaluate operating profitability and performance trends
    by excluding items that the company does not consider to be controllable
    activities for this purpose. Adjusted EBITDA also represents a measure
    commonly reported and widely used by investors as a valuation metric.
    Additionally, this measure is used by Thomson Reuters and investors to
    assess a company's ability to incur and service debt.

(2) Thomson Reuters defines adjusted earnings as net earnings or loss including
    dividends declared on preference shares but excluding the post-tax impacts
    of fair value adjustments, amortization of other identifiable intangible
    assets, other operating gains and losses, certain asset impairment charges,
    other finance costs or income, Thomson Reuters share of post-tax earnings or
    losses in equity method investments, discontinued operations and other items
    affecting comparability. Thomson Reuters calculates the post-tax amount of
    each item excluded from adjusted earnings based on the specific tax rules
    and tax rates associated with the nature and jurisdiction of each item.
    Adjusted EPS is calculated from adjusted earnings using diluted
    weighted-average shares and does not represent actual earnings or loss per
    share attributable to shareholders. Thomson Reuters uses adjusted earnings
    and adjusted EPS as they provide a more comparable basis to analyze earnings
    and they are also measures commonly used by shareholders to measure the
    company's performance.

(3) Adjustment to reflect income taxes based on 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.

(4) The changes in revenues, adjusted EBITDA and the related margins, and
    adjusted earnings per share before currency (at constant currency or
    excluding the effects of currency) are determined by converting the current
    and prior-year period's local currency equivalent using the same exchange
    rates.

(5) Free cash flow is net cash provided by operating activities, proceeds from
    disposals of property and equipment, and other investing activities less
    capital expenditures, payments of lease principal, dividends paid on the
    company's preference shares, and dividends paid to non-controlling
    interests. Thomson Reuters uses free cash flow as it helps assess the
    company's ability, over the long term, to create value for its shareholders
    as it represents cash available to repay debt, pay common dividends and fund
    share repurchases and new acquisitions.

(6) Represents changes in revenues of our existing businesses at constant
    currency. The metric excludes the distortive impacts of acquisitions and
    dispositions from not owning the business in both comparable periods.
    Thomson Reuters uses organic growth because it provides further insight into
    the performance of its existing businesses by excluding distortive impacts
    and serves as a better measure of the company's ability to grow its business
    over the long term.

(7) Net debt is total indebtedness (including the associated fair value of
    hedging instruments, but excluding the associated unamortized transaction
    costs and premiums or discounts and the interest-related fair value
    component of hedging instruments), and lease liabilities less cash and cash
    equivalents. For purposes of calculating the leverage ratio, net debt is
    divided by adjusted EBITDA for the previous twelve-month period ending with
    the current fiscal quarter.
(millions of U.S. dollars, except for margins)                      Change

(unaudited)                                       2020    2019 Total   Before
                                                                      Currency
                                                                     & Excluding

Three months ended March 31,                                         Businesses
                                                                      Disposed

IFRS Measures

Revenues                                            4%       5%

Net loss                                           

Cash flow from operations                          

Capital expenditures, less proceeds from              
disposals

Debt at March 31, 2020 and March 31, 2019       

Non-IFRS Measures

Adjusted EBITDA                                       

Adjusted EBITDA margin                           38.0%   35.5%

Free cash flow$1,633$1,567$(93)$(243)$(54)$(200)$186$131$13,698$13,895$620$557$(245)$(341)
Refinitiv

           Reconciliation of Net Loss to Adjusted EBITDA

           (millions of  dollars, except for margins)

                            (unaudited)

                                                        Three Months
                                                           Ended
                                                         March 31,

                                                         2020   2019

Net loss                                                 

Adjustments to remove:

Tax benefit                                                 -   (22)

Finance costs                                             166    235

Depreciation and amortization                             471    463

EBITDA                                                      

Adjustments to remove:

Share of post-tax earnings in equity method investments   (1)      -

Other operating (gains) losses                           (54)      1

Fair value adjustments                                      6     22

Share-based compensation                                   13      4

Transformation-related costs                              112     97

Adjusted EBITDA                                             

Adjusted EBITDA margin                                  38.0%  35.5%U.S.$(93)$(243)$544$433$620$557
Refinitiv

Reconciliation of  In Operating Activities to Free
                           Cash Flow

                   (millions of U.S. dollars)

                          (unaudited)

                                                   Three Months
                                                       Ended

                                                     March 31,

                                                     2020   2019

Net cash used in operating activities                

Capital expenditures, less proceeds from disposals  (186)  (131)

Other investing activities                              1    (1)

Dividends paid to non-controlling interests           (6)    (9)

Free cash flowNet Cash Used$(54)$(200)$(245)$(341)
NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of...

FOR OUR FULL DISCLAIMER CLICK HERE

108 min read