Thomson Reuters to cut 2,000 jobs worldwide as it speeds up streamlining

TORONTO – Thomson Reuters (TSX:TRI) says it’s eliminating 2,000 positions around the world as it speeds up efforts to streamline and simplify its global information services organization.

The layoffs represent close to four per cent of the company’s global workforce of about 52,000 employees, 1,200 of which are in Canada.

The company, which has its principal executive office in New York City but retains a corporate headquarters in Toronto, says the reorganization will result in between US$200 million and US$250 million of accounting charges to be recorded in the fourth quarter.

The advanced notice was included with the company’s third-quarter financial report, which showed Thomson Reuters had US$2.7 billion of revenue and net income of US$286 million or 36 cent cents per diluted share for the three-month period.

The company’s statement provided little detail about its plans for an accelerated “transformation” program except that most of the charges will be taken in its core financial and risk services unit and a new enterprise, technology and operations group.

But a spokesman for Thomson Reuters confirmed by email that 2,000 positions will be cut in 39 countries and 150 locations.

The third quarter results — including discontinued operations and reported in U.S. currency — were little-changed from the third quarter of 2015, when revenue was $2.75 billion and net income was $293 million or 36 cents per share of diluted earnings.

Earnings from continuing operations rose to $268 million or 34 cents per diluted share from $263 million or 32 cents per share.

The company’s intellectual property and science business was sold for US$3.55 billion cash in a deal that closed on Oct. 3, providing about $3.2 billion in net proceeds that will be used to repay debt, buy back shares and invest in the business.

Thomson Reuters announced on Oct. 7 that it planned to establish a new technology centre in Toronto, with hiring of an initial 400 jobs to begin in December. The company’s CEO and other senior executives will also relocate to the city.

“Our core subscription businesses are moving in the right direction, our cost controls are working and we are increasingly confident in our execution capability,” Thomson Reuters CEO Jim Smith said in a statement. “That is why we are going to pick up the pace of our transformation efforts.”

In the third quarter ended Sept. 30, revenue at Financial & Risk was flat at US$1.5 billion, while revenue from legal services fell to $835 million from $851 million and revenue from tax and accounting services increased to $323 million from $307 million.

The segment that includes Reuters News had $73 million of revenue, down from $74 million in the third quarter of 2015.

Thomson Reuters originated in Canada and owned a national chain of newspapers before it diversified and evolved into an information services provider to the financial, legal and other professional communities.

It also owns Reuters — one of the world’s largest news organizations — which was acquired by Thomson Corp. in 2007. The Thomson family, through its private holdings, continues to be majority owner of the Globe and Mail but the publicly traded company Thomson Reuters no longer owns newspapers.