UPDATE 4-Thomson Reuters profit beats, finance unit shows growth

(Adds context on financial sector, more CEO comment, updates
shares)
By Lewis Krauskopf
July 29 (Reuters) - Thomson Reuters Corp TRI.N TRI.TO on
Wednesday reported higher-than-expected quarterly profit as the
company's biggest division that serves banks and financial
institutions showed underlying revenue growth for the first time
since 2011.
Revenue at its Financial & Risk segment rose 1 percent in the
second quarter when excluding currency and acquisitions.
"It was very encouraging to see organic growth in F&R," said
Jefferies analyst Dan Dolev. "Everybody has been waiting for it.
They delivered it."
Thomson Reuters shares, which had been down more than 6
percent in 2015 through Tuesday, rose 4 percent after the
results, their best one-day move in about four years.
The news and information company posted underlying revenue
increases across its four main divisions.
"The quarter and the first half just confirms the momentum
that is building inside the business," Chief Executive Jim Smith
said in an interview.
Thomson Reuters has struggled to expand since Thomson Corp
acquired Reuters Group Plc in 2008, a $17 billion merger that
was completed just as the financial industry crisis started.
More recently, since the end of January, U.S. financial
shares .SPSY have outperformed the broader market .SPX . Much
of that optimism has come from investors preparing for the
Federal Reserve to raise interest rates, boosting the rates at
which banks can lend and therefore their profits.
Smith, in the interview, pointed to more stability in the
banking and financial services sectors than a few years ago. He
also said Thomson Reuters had benefited from increasing
regulation as customers seek out the company's risk products.
Second-quarter net earnings were $281 million, or 33 cents
per share, compared with $260 million, or 31 cents per share, a
year ago.
Adjusted for special items, earnings were 52 cents per
share. Analysts, on average, were looking for 50 cents per
share, according to Thomson Reuters I/B/E/S.
Revenues fell 4 percent to $3.04 billion, but rose when
factoring out currency rate swings. That was slightly below Wall
Street estimates of $3.07 billion, based on a survey of 12
analysts who follow the New York-listed shares.
In its Financial & Risk segment, revenue was $1.55 billion.
Revenues in the Americas and Asia each rose by 1 percent, while
they were flat in Europe, Middle East and Africa. The division's
net sales outpaced cancellations - a key indicator of future
growth.
"We have seen the underlying momentum now over the past
couple of years," Smith said about the key division, which
represents more than half of the company's overall revenue. "I
am confident in the trajectory, and we will maintain that
trajectory of continued improvement."
Jefferies' Dolev said the company has been successful in
migrating customers to new versions of its Eikon financial
platform.
Revenue in its Legal business, which includes the Westlaw
legal database, was $840 million, rising 2 percent on an organic
basis. Tax & Accounting sales increased 5 percent organically.
The company reaffirmed its 2015 forecast, including the
expectation for positive organic revenue growth. It said it
continues to project that currency is likely to have a
higher-than-usual impact on 2015 results.
Thomson Reuters, which is the parent of Reuters News,
competes for financial customers with Bloomberg LP, as well as
News Corp's NWSA.O Dow Jones unit.
Shares were up 3.8 percent at C$50.54 in Toronto and 4
percent at $39.17 in New York trading.
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