Thomson Reuters reports large 4Q loss

NEW YORK (AP) — Thomson Reuters reported a large fourth-quarter loss on Thursday, weighed down by a $3 billion charge related to the declining value of its financial services business, which accounts for more than half of its revenue.

The company lost $2.57 billion, or $3.11 per share, in the last three months of 2011. That's down from earnings of $224 million, or 27 cents per share, a year earlier.

Excluding one-time items, Thomson Reuters earned 59 cents in the latest quarter, better than the 56 cents that analysts polled by FactSet had expected.

Besides the hefty $3 billion charge for financial services, the company took a $50 million charge mainly for the reorganization of its financial services business. Bernstein analyst Claudio Aspesi said the hefty impairment charge came as no surprise.

Thomson Reuters booked the writedown because its financial services business is not worth as much as the company expected when Thomson Corp. bought Reuters Group PLC in 2008 for more than $16 billion.

That was before the global financial turmoil hit and large customers such as Lehman Brothers and Merrill Lynch collapsed. The division also suffered from a recession in 2010 as demand for financial information waned and from competition from rivals such as Bloomberg and News Corp.'s Dow Jones.

"The fact of the matter is the external world and market valuations have changed since we completed the Reuters acquisition in 2008," CEO James Smith said in a conference call with analysts. "The fact also is that we did not execute up to our expectations and we've yet to achieve the performance we expected from certain parts of the markets business," or financial services.

In December, Thomson Reuters replaced CEO Tom Glocer with Smith, an executive with closer ties to the family that owns a controlling interest in the company.

The company's revenue rose 3 percent to $3.58 billion from $3.46 billion. Aspesi said revenue showed resilience, even in the "challenged" financial services business, where revenue grew nearly 2 percent to $1.86 billion. The Reuters news service is part of that division.

Revenue at the company's other business segment, its professional division, grew 9 percent to $1.5 billion.

Thomson Reuters, which is based in New York, expects 2012 revenue to grow in the low single digits.

Shares of Thomson Reuters Corp. slid 34 cents to close at $27.43 on Thursday, after the release of results. The stock is down nearly 20 percent since the end of July.