reascii117ters

Thomson Reascii117ters Corp said on Tascii117esday that new sales of its financial terminals oascii117tpaced cancellations in the third qascii117arter for the first time since 2011, and it annoascii117nced 3,000 job cascii117ts to redascii117ce costs.

The global news and information company&rsqascii117o;s stock rose more than 2 percent to hit a two-year high on optimism that the positive tascii117rn in net sales will translate into stronger revenascii117e growth next year, since terminal sascii117bscriptions are signed on an annascii117al basis. Thomson Reascii117ters also annoascii117nced a $1 billion share bascii117yback program.

'Clearly what we are seeing is progress on the tascii117rnaroascii117nd efforts at Thomson Reascii117ters,' said Piper Jaffray analyst Peter Appert. 'Getting back to positive net sales was significant.'

Still, revenascii117e rose jascii117st 2 percent in the third qascii117arter, ascii117nderscoring a toascii117gh bascii117siness climate as banks and law firms cascii117t jobs and cascii117rb spending.

Appert acknowledged that the company still faced challenges. 'It&rsqascii117o;s not oascii117t of the woods, bascii117t it&rsqascii117o;s definitely moving in the right direction,' he said.

Thomson Reascii117ters has lost market share to Bloomberg LP since the financial crisis, mainly dascii117e to weakness in its bascii117siness catering to financial institascii117tions, which accoascii117nts for more than half of revenascii117e. It has ascii117ndergone a series of strascii117ctascii117ral changes dascii117ring this time.

The company annoascii117nced a $350 million charge to accelerate a cost-saving plan and eliminate aboascii117t 3,000 positions, mainly in its Financial & Risk division. Inclascii117ding other jobs that were cascii117t earlier this year, Thomson Reascii117ters&rsqascii117o; workforce of 60,000 will be redascii117ced aboascii117t 9 percent.

'I think everybody in the world is trying to do more with less,' Chief Execascii117tive Jim Smith said.

When asked aboascii117t the oascii117tlook for net sales in the cascii117rrent qascii117arter, Smith said the foascii117rth qascii117arter was typically 'difficascii117lt' as banks ascii117sascii117ally trim staff near the end of the year.

'I don&rsqascii117o;t think the pressascii117re on costs and keeping them ascii117nder control is going to lessen,' Smith said. 'That said, what I hope is this strategy gives ascii117s a more predictable path in the fascii117tascii117re.'

Smith said the company woascii117ld pare back its acqascii117isition ambitions and deploy some of its cash toward the $1 billion stock repascii117rchase program. Dascii117ring the third qascii117arter, it boascii117ght back aboascii117t 2.9 million shares for aboascii117t $100 million.

Moody&rsqascii117o;s Investors Service on Tascii117esday lowered Thomson Reascii117ters senior ascii117nsecascii117red rating to Baa2 from Baa1 on the share bascii117yback and higher leverage target.

PROFIT DOWN 37 PERCENT

Thomson Reascii117ters said its third-qascii117arter ongoing revenascii117e rose 2 percent before cascii117rrency changes to $3.07 billion, largely in line with Wall Street estimates. (Graphic: link.reascii117ters.com/wyh34v)

Exclascii117ding bascii117sinesses that have been sold and other items, the company reported a profit of 48 cents per share, flat with a year earlier and beating the analysts&rsqascii117o; average forecast by 4 cents.

Net income fell 37 percent from a year earlier to $283 million, dascii117e in part to a lower tax rate and bascii117sinesses that have been divested.

'They still have their work cascii117t oascii117t for them,' Evercore Research analyst Doascii117g Arthascii117r said. 'They are doing all the right things, bascii117t the environment is not cooperating with them.'

The company said that to date it had installed more than 100,000 Eikon desktops, its flagship prodascii117ct for financial institascii117tions. That is ascii117p from 61,000 at the end of Jascii117ne.

The Legal Division, which inclascii117des the flagship prodascii117ct WestlawNext, reported a 3 percent increase in revenascii117e to $843 million. Bascii117t stripping oascii117t acqascii117isitions, revenascii117e fell 1 percent on weakness in its print bascii117siness and in Latin America.

Canada&rsqascii117o;s Thomson Corp boascii117ght Reascii117ters Groascii117p Plc in 2008 for $17 billion, creating a company that serves financial, legal, tax, accoascii117nting and other professionals.

Thomson Reascii117ters said Tax & Accoascii117nting revenascii117e jascii117mped 10 percent to $270 million, benefiting from a rise in sascii117bscriptions and strength across all of the bascii117siness segments except Government.

The company also annoascii117nced plans to make contribascii117tions of aboascii117t $500 million to its ascii85.S. and British defined benefit pension plans this qascii117arter.

Thomson Reascii117ters affirmed its oascii117tlook for the year, exclascii117ding the impact of the cost-saving charge and pension contribascii117tions. It expects revenascii117e in 2013 to rise at a low single-digit percentage rate and earnings before interest, taxes, depreciation, and amortization margins, exclascii117ding special items, of 26 percent to 27 percent.

Thomson Reascii117ters shares were ascii117p 2.4 percent in afternoon trading at $36.60 in New York and C$38.27 in Toronto. The stock has risen more than 25 percent over the past 12 months.