Reuters jumps the gun

19 October 2004 By Fiona Maharg-Bravo

The information services provider has benefited from an uptick in hiring in the investment banking industry earlier this year. But the outlook for jobs has since soured. That s what matters most for Reuters sales and its share price next year.

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Reuters said third quarter sales fell 13% to £570m compared to the same period a year ago. Stripping out the effect of exchange rates and the impact of acquisitions and disposals, the drop was 5%. Recurring revenue was down 4.4.% ahead of the 5% forecast by the company. This was driven by lower cancellations, which were outpaced by new subscriptions for the first time since the first quarter of 2001.

The company said it expects recurring revenue to be down by 5.5% for the year as a whole, implying they would fall 3% in the fourth quarter compared with the same period last year.

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