Thomson Reuters Corp said it expects revenue to rise in 2011 after stronger growth in the fourth quarter and more signs that its financial and professional customers are recovering from the recession.
The company, which provides news and information to financial, legal, accounting and healthcare professionals, said on Thursday it expects 2011 revenue to rise by a mid-single digit percentage. Analysts on average expect 2011 revenue to rise about 4 percent, according to Thomson Reuters I/B/E/S.
Highlighting the brighter outlook, the company raised its annual dividend by 7 percent to $1.24 per share.
The outlook suggests that the company's customers are recovering from the economic downturn that caused a pullback in spending and widespread layoffs.
Still, the adjusted earnings per share of 43 cents missed the average analyst forecast of 46 cents.
Total revenue from ongoing businesses rose 4 percent in the fourth quarter to $3.46 billion, before currency adjustments, led by a 7 percent increase in revenue from the Professional division, whose customers include lawyers and accountants. Revenue in the Markets division rose 2 percent.
Analysts had forecast total revenue of $3.43 billion.
Thomson Reuters has invested heavily in new products such as its financial desktop Eikon, online video news service Reuters Insider and its legal database service WestlawNext.
With this period of heavy investment now successfully completed and our markets improving, we have set our sights on accelerating growth and delivering strong returns on our investments, Chief Executive Tom Glocer said in a statement.
We have targeted mid-single digit revenue growth for 2011, accompanied by strongly expanding margins and increasing levels of free cash flow, he said.
PROFESSIONAL DIVISION LEADS GROWTH
Growth in the Professional division was driven in part by an 8 percent increase in legal revenue. The company said that WestlawNext, launched in February 2010, has been sold to more than 15,000 customers.
The company also said it planned to sell its legal education business BARBRI and its Scandinavian legal and tax and accounting business.
In the Markets division, which competes with Bloomberg LP and News Corp's Dow Jones unit, revenue rose to $1.92 billion. Like Bloomberg, Thomson Reuters gets much if its revenue from long-term subscriptions.
The company said it has sold more than 12,000 of its latest flagship financial desktop product Eikon to new and existing customers.
Underlying operating profit rose 3 percent to $669 million, driven in part by higher revenue in the Professional division.
The company raised its 2011 savings target by $100 million to $1.7 billion.
(Reporting by Jennifer Saba; Editing by Ted Kerr)