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UPDATE 4-Thomson Reuters on offense as Blackstone deal nears

Published 2018-08-08, 10:36 a/m
© Reuters.  UPDATE 4-Thomson Reuters on offense as Blackstone deal nears
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* CEO says evaluating a couple of acquisition opportunities

* CEO says company "in position to play offense"

* Company says on track for "solid year"

* Q2 EPS $0.17 vs forecast $0.11 (Adds CEO comment from conference call, analyst comment)

By Matt Scuffham

TORONTO, Aug 8 (Reuters) - Thomson Reuters Corp TRI.TO TRI.N said it was thinking about acquisition opportunities after reporting quarterly earnings that were ahead of expectations on Wednesday and reaffirming its 2018 forecast.

The news and information provider agreed in January to sell a 55-percent stake in the Financial & Risk unit, which provides data and news primarily to financial customers, to private equity firm Blackstone (NYSE:BX) Group LP BX.N . It expects to use $1 billion to $3 billion from the proceeds of the Blackstone deal to make acquisitions in legal and accounting.

"There are a couple that look quite interesting to us and we'll continue to evaluate them," Chief Executive Officer Jim Smith said in an interview, adding that the firm was "not going to let the money burn a hole in our pockets."

Thomson Reuters said it expects to complete the $20 billion Blackstone deal in the fourth quarter and Smith told analysts on a conference call that will clear the path for expansion.

"Following the closure of the deal with Blackstone, Thomson Reuters will be in a position to play offense," he said.

The company said that, adjusted for special items, earnings were 17 cents per share, down from 19 cents per share a year ago. That was ahead of the average analyst forecast of 11 cents a share, according to Thomson Reuters I/B/E/S.

Shares in Thomson Reuters, which have risen by 14 percent since May, were up 3 percent to C$55.19 at 10.00 a.m. ET. The U.S.-listed shares rose 3 percent to $42.20.

"We were encouraged by growth in Thomson Reuters' core businesses," said analyst Brittany Weissman of Edward Jones.

Quarterly revenue rose by 2 percent to $1.31 billion, in line with market forecasts.

Operating profit fell by 6 percent to $204 million, which the company said was primarily due to costs ahead of the Blackstone deal.

Blackstone is making its biggest bet since the financial crisis with the acquisition, which pits co-founder Stephen Schwarzman against fellow billionaire and former New York Mayor Michael Bloomberg. the quarter, the Financial & Risk business - now counted as a discontinued operation - grew revenues by 2 percent in constant currency to $1.55 billion.

The company's legal business reported revenue of $882 million in the second quarter, up 2 percent when factoring out currency. The Tax & Accounting unit reported revenue of $359 million, up 4 percent when factoring out currency.

Reuters News reported $72 million in revenues, down 5 percent from a year earlier in constant currency.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Blackstone sees data, not desktop products, as future of Thomson Reuters F&R unit

Blackstone fourth-quarter profit up 5 pct on private equity gains

Blackstone bets big on Wall St. information business with Thomson Reuters deal

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