Thomson Reuters to cut 2,500 jobs; no impact in Eagan
- Wire services
- February 13, 2013 - 10:23 PM
NEW YORK – Shares of Thomson Reuters Corp. declined the most in more than six months after the provider of news and information services predicted slow growth and narrowing profit margins in 2013, and announced plans to cut 2,500 jobs.
Revenue will increase in the “low single digits,” the company said Wednesday. Its adjusted profit margin — based on earnings before interest, taxes, depreciation and amortization — will range between 26 percent and 27 percent this year. It was 28.2 percent in the fourth quarter.
Thomson Reuters shares fell 2.3 percent to close at $29.96, marking the biggest one-day decline since July 2012. The shares have gained 3.1 percent this year, compared with a 6.6 percent increase for the Standard & Poor’s 500 index.
Thomson Reuters is midway through an effort to turn around its financial and risk-management operations, CEO James C. Smith said.
The company is relying on cost cutting to improve its profitability, though it continues to invest in some areas such as customer service. The job cuts, which Thomson Reuters announced on a conference call Wednesday, will come from the finance and risk business, affecting about 4 percent of the company’s total employees. The move will result in severance costs of about $100 million.
The 2,500 job cuts will not affect the company’s campus in Eagan, where about 7,000 people work. The Eagan operations focus primarily on legal work, and the company has scores of job openings in Eagan listed on its website.
© 2013 Star Tribune