Reuters reports favourable outlook for 2007

Reuters reports favourable outlook for 2007

Reuters shares moved up three per cent in early trading on forecasts of strong growth in the next fiscal year as the company reported an eight per cent dip in trading profits for 2006.

The news and information group says it expects underlying revenue growth of at least 6 percent this year, up from 4.8 percent in 2006.

Trading profit for the year to end-December fell to £308 million pounds from £334 million last year, following a £77 million outlay on its CorePlus growth strategy. The dip in trading profit was well-previewed and does not reflect changes due to acquisitions, notably Telerate.

Group revenue in 2006 rose 6.5 percent to £2.566 billion pounds and 6.2 percent on a constant currency basis,

Shares in the group moved up 3.2 percent to 450 pence in early trade, as investors digested the better-than-expected guidance.

Chief executive Tom Glocer took an optimistic view of the year ahead basing his forecasts on improving conditions in core financial markets and new initiatives in prime brokerage, emerging markets and consumer media sales.

"We are off to a strong start in 2007, including the recently announced enterprise agreement with HSBC," says Glocer. "I am determined to pursue my twin goals of growth and simplification under the Core Plus strategy. This will allow us to deliver strong, sustainable revenue growth and 17-20% trading margins over the medium term.”

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