Tax & accounting sales drive Thomson Reuters profit
By Jennifer Saba
(Reuters) - Thomson Reuters Corp's quarterly results beat analysts' expectations as the company racked up strong software sales to tax professionals, accountants and financial institutions looking to comply with government regulations.
The company's Tax & Accounting unit posted a 31 percent rise in first-quarter revenue to $310 million, citing growth in the United States and Latin America and through acquisitions like property and real estate tax software Manatron.
While Thomson Reuters' business serving the financial industry remained under pressure from layoffs and other cost cuts at banks, its overall results were lifted by the Tax & Accounting and Legal divisions.
The global news and information provider reported on Tuesday that first-quarter adjusted earnings per share rose to 44 cents, up from 37 cents a year earlier and above the average analyst forecast of 41 cents per share, according to Thomson Reuters I/B/E/S. Shares rose 1.8 percent to $30.37 in New York trading.
"Everything seems to be working in line or better than expected and that is really good news," said Claudio Aspesi, an analyst with Sanford Bernstein.
Thomson Reuters said first-quarter revenue at its Financial & Risk division, which serves financial institutions, grew 1 percent to $1.8 billion, as declines in sales to traders and wealth managers were offset by increases in sales to risk and compliance customers, as well as acquisitions.
"I am really pleased with how the team has responded and the progress we are making inside the company," Thomson Reuters Chief Executive James Smith said. "The biggest challenges right now are outside the company, the macroeconomic environment, particularly in Europe."
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