Shares in Reuters have surged over the 400 pence mark for the first time in nearly two years as the news and information group reports profits, revenues and costs savings for 2003 above market expectations.
Reuters reported unadjusted pre-tax profits of £49 million for the year ending December 2003, a turnaround from 2002's record losses of £493 million. Full year revenues were down 11% at £3.2 billion with costs savings £30 million ahead of plan at £75 million. Revenue decline for Q1 is expected to be nine per cent, with gradual improvements expected throughout 2004.
Core revenue decline in subscription products for Q4, 2003 was less than expected at 9.8% due to a larger than forecast reduction in the level of net cancellations, particularly in Europe.
Tom Glocer, Reuters' chief executive, says: " Reuters is on the road to recovery, with the worst of our revenue declines behind us." He hinted that it might be possible to reverse the slide in revenues in 2005, a year earlier than expected.
Shares in the group soared on the results, hitting 405 pence by mid-morning, up 42.5 pence (11%) on yesterday's close of 362.5.
The group was also cheered by news of a global market data deal at UBS Investment Bank. Under the agreement, Reuters Market Data Systems will serve more than 3500 UBS Investment Bank staff at over 25 locations globally.