Thomson Reuters Corporation · TSX:TRI
Thomson Reuters — Q1 2022 Earnings Presentation
25 slides from Thomson Reuters's earnings presentation, May 3, 2022
Slide 1: Thomson Reuters 2022 First-Quarter Results
REUTERS / Mike Hutchings Thomson Reuters 2022 FIRST-QUARTER RESULTS May 3, 2022 THOMSON REUTERS ?
Slide 2: Agenda
Agenda • Welcome / Introduction Gary Bisbee • First-Quarter 2022 Highlights Steve Hasker Legal Professionals & Practical Law Discussion • Financial Review Mike Eastwood First-Quarter 2022 Results 2022 Full-Year Outlook Update • Q&A 2 THOMSON REUTERS ?
Slide 3: Special Note Regarding Forward-Looking Statements
Special Note Special Note Regarding Forward-Looking Statements, Material Assumptions and Material Risks This presentation consists of these slides and the associated remarks and comments, which are related and intended to be presented and understood together. Certain statements in this presentation
Slide 4: First-Quarter 2022 Highlights
THOMSON REUTERS First-Quarter 2022 Highlights Steve Hasker President & CEO 4 THOMSON REUTERS
Slide 5: First-Quarter 2022 Highlights
First-Quarter 2022 Highlights 1. Strong organic revenue & sales growth continued in Q1 2022 • Four of five Business Segments grew 6%+ organically • “Big 3” Business Segments (Legal, Corporates and Tax & Accounting) revenues grew 7% organically 2. Strong Prevailing Tailwinds Play to Our Strengths & C
Slide 6: First-Quarter 2022 Consolidated Results
First-Quarter 2022 Consolidated Results IFRS Financial Measures ($ millions) 2022 2021 Change Revenues $1,674 $1,580 Up 6% Operating profit $414 $387 Up 7% Diluted earnings per share (EPS) $2.06 $10.13 Down 80% Cash flow from operations $275 $380 Down 28% Change at Constant Organic Non-IFRS Financia
Slide 7: First-Quarter 2022 Revenue Growth by Segment
First-Quarter 2022 Revenue Growth by Segment Reported revenues up 6% to $1.7 billion Organic revenues up 7% Organic recurring revenues up 7% Tax Corporates Reuters News Global Print Professionals Legal Tax & Accounting Corporates Reuters News Global Print Professionals Professionals $0.7B $0.4B $0.3
Slide 8: Legal Professionals & Practical Law Discussion
Legal Professionals & Practical Law Discussion 8 THOMSON REUTERS
Slide 9: Legal Professionals Revenue Mix
Legal Professionals Revenue Mix Legal Professionals revenue growth has accelerated with four consecutive quarters of 6% organic growth -- driven by both Westlaw and non-Westlaw; We see multiple levers driving sustained momentum 2017 – 2021 2021 2021 Revenue CAGR Org. Growth Westlaw +3% +4% Non-Westl
Slide 10: What is Practical Law?
What is Practical Law? Practical Law provides quick access to relevant, comprehensive and accurate know-how resources that help professionals work more effectively and efficiently What content is offered? How is it created? Standard Documents & Clauses Full-Time Editorial Staff Model agreements and
Slide 11: Practical Law: A powerful growth story with room to run
Practical Law: A powerful growth story with room to run Practical Law has grown at a 16% revenue CAGR since it was acquired in 2013; We expect continued double-digit growth driven by sales execution and product innovation Revenue Growth 2013 - 2021 Business Case / Growth Drivers ~$445M • New Content
Slide 12: Who uses Practical Law and how is it used?
Who uses Practical Law and how is it used? Persona Key Responsibilities Emotional Pain Points Needs PL Content Used (PL Role) • Advise clients Make money; • Know the most up to date law • Current Awareness S Partner • Develop business Get things beat billing • Be a strategic advisor • What’s Market
Slide 13: Financial Review
Financial Review First-Quarter 2022 Results Updated 2022 Outlook Mike Eastwood Chief Financial Officer 13 THOMSON REUTERS
Slide 14: First-Quarter 2022 Legal, Corporates, Tax & Accounting Professionals Revenues
First-Quarter 2022 Legal, Corporates, Tax & Accounting Professionals Revenues ($ millions) First Quarter Constant Revenues 2022 2021 Total Currency Organic Legal Professionals 698 668 +4% +5% +6% Corporates 411 382 +8% +8% +8% Tax & Accounting Professionals 253 227 +11% +11% +11% Big 3 Revenues 1,36
Slide 15: First-Quarter 2022 Consolidated Revenues
First-Quarter 2022 Consolidated Revenues ($ millions) First Quarter Constant Revenues 2022 2021 Total Currency Organic Reuters News 176 165 +7% +9% +9% Global Print 142 143 -1% - - Eliminations / Rounding (6) (5) Total Revenues 1,674 1,580 +6% +7% +7% 15 THOMSON REUTERS ?
Slide 16: First-Quarter 2022 Consolidated Adjusted EBITDA
First-Quarter 2022 Consolidated Adjusted EBITDA ($ millions) First Quarter Constant Adjusted EBITDA 2022 2021 Total Currency Legal Professionals 305 279 +9% +10% Margin 43.7% 41.8% Corporates 157 145 +8% +7% Margin 38.1% 38.0% Tax & Accounting Professionals 122 99 +23% +22% Margin 48.3% 43.8% Big 3
Slide 17: Adjusted Earnings Per Share (EPS)
Adjusted Earnings Per Share (EPS) ($ millions except per share amounts & share count) First Quarter 2022 Change % Change Adjusted EBITDA $600 $42 Depreciation & Amortization ($152) $9 Interest Expense ($48) $3 Income Tax ($77) ($20) Dividend declared on preference shares ($1) - Adjusted Earnings $32
Slide 18: Consolidated Free Cash Flow
Consolidated Free Cash Flow ($ millions) First Quarter 2022 2021 Change Comparable Free Cash Flow (Continuing Operations) 259 288 (29) Other Items (Change Program Costs) (114) (12) (102) Free Cash Flow (Continuing Operations) 145 276 (131) Free Cash Flow – Discontinued Operations (59) (37) (22) Free
Slide 19: Drivers of 2023 Variance Between Free Cash Flow & Adjusted Earnings
Drivers of 2023 Variance Between Free Cash Flow & Adjusted Earnings We forecast 2023 Free Cash Flow continuing to comfortably exceed Adjusted Earnings due to Capital vs. D&A, Taxes and Non-Cash Charges $ Millions Factors • Reduction in Capital Intensity has immediate impact Capital vs. on Free Cash
Slide 20: Change Program Investments & Savings
Change Program Investments & Savings 20 THOMSON REUTERS
Slide 21: Change Program FY 2022 Forecast & Cumulative Run-Rate Savings
Change Program FY 2022 Forecast & Cumulative Run-Rate Savings Achieved Annualized Run-Rate Operating Expense Savings of $305M as of March 31, 2022 FY 2022 Annualized Run-Rate Savings Forecast of ~$500M ~$500M $305M $217M FY-2021 Q1-2022 FY-2022 Cumulative Cumulative Cumulative Outlook 21 THOMSON REU
Slide 22: Change Program Investments
Change Program Investments Forecast ~$305M of Change Program Investments in 2022; ~$600M of cumulative Change Program investments over 2021 - 2022 2022 Phasing ~$305M Operating Expenditures H1-2022: ~60% (OpEx) ~$130M - $150M ~$160M - $180M ~60% $62M ~$70M - $90M ~40% Capital Expenditures ~60% $34M
Slide 23: 2022 Outlook Update
2022 Outlook Update 23 THOMSON REUTERS
Slide 24: 2022 Updated Outlook
2022 Updated Outlook FY 2021 FY 2022 Outlook(2) FY 2022 Outlook(2) FY 2022 Outlook(2) Total Thomson Reuters Reported 2/23/21 2/8/22 5/3/22 Total Revenue Growth 6.1% 4.0% - 5.0% ~ 5% ~5.5% Organic Revenue Growth (1) 5.2% 4.0% - 5.0% ~ 5% ~5.5% Adjusted EBITDA Margin (1) 31.0% 34% - 35% ~ 35% Unchange
Slide 25: Q&A
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