By Dave Sebastian
Thomson Reuters Corp. said it plans to transition into an operating company from a holding entity and to enhance its technology focus, as part of a two-year roadmap to streamline the company.
The program, expected to run from 2021 to 2022, could require an investment of $500 million to $600 million, the Toronto-based news and information company said Tuesday. The company said it expects the program to grow organic revenue by 5% to 6% in 2023, including additional annual revenues of $100 million.
Thomson Reuters said it sees operating-expense savings of $600 million, a third of which it expects to reinvest in growth initiatives, in 2023. It said it is targeting to reduce capital expenditures as a percentage of revenue to between 6% and 6.5%. The company expects to achieve an adjusted earnings before interest, taxes, depreciation and amortization margin of 38% to 40% and free cash flow of $1.8 billion to $2 billion.
The transition would take the company from a content provider to a content-driven technology company, Thomson Reuters said.
President and Chief Executive Steve Hasker said the company is starting the program with strength in its legal, tax and accounting and government businesses.
"Prevailing tailwinds are favorable and play to our strengths," Mr. Hasker said. "Covid-19 has changed how, when and where professionals work."
For the first quarter of 2021, the company said it expects revenue to rise 1.5%, or 2.5% on an organic basis. It expects to take a hit from the 13% to 15% decline in global print revenue. It sees first-quarter revenue growth of 4%, or 5% on an organic basis, in its three largest segments combined: legal professionals, corporates and tax and accounting professionals.
The company expects global print revenue to fall 4% to 7% for the full year.
Write to Dave Sebastian at email@example.com
(END) Dow Jones Newswires