Reuters has reported a 34 per cent fall in annual profits for 2001, and warned that revenues will continue to decline through the coming year as spending cuts at investment banking clients begin to bite.
The news and information group is reporting pre-tax profit before goodwill amortisation and one-off items of £304 million, some way below market forecasts of around £330 million.
Full-year group revenue rose 8.2% to £3.89 billion, but was flat in the final quarter. Tom Glocer, Reuters' CEO says the worst is yet to come, with revenues from subscriptions expected to drop by as much as three per cent in the first half of 2002. The company has raised its estimate of total job losses to 1800 from 1600.
Shares in Reuters fell three per cent to stand at £5.57 in early trading.
The prolonged market slump has also hit Reuters' electronic brokerage subsidiary Instinet, which reported seperate results in New York on Monday. The company, which posted a 27 percent rise in quarterly profit, is to lose a further 200 jobs as part of a cost-cutting exercise aimed at countering an 11% drop in revenue. Instinet's share of trading volume in the Nasdaq stock market fell to 11.7% from 13.5% in the fourth quarter as the company was overtaken by rival electronic communications network Island for Nasdaq market share.