Reuters shares fall 8% despite better news on revenue decline
Wednesday 23 July 2003
Reuters, the financial information and news giant, said its rate of revenue decline should ease in the second half of this year, as it reported a 12 per cent fall in underlying revenues for the first six months of 2003.
The news group failed to convince the market its prospects have significantly improved, however, after admitting that next year would see another fall in sales.
The shares ended a rally that has seen them double since mid-March, closing down 8 per cent to 200.75p even though the group's interim results came in above market expectations.
The company warned the cycle of job losses among its customers in Europe had not bottomed out, although it appeared to have turned the corner in the US.
The group said its operating margin came in at 14.7 per cent, ahead of previous guidance, while pre-tax profit was £16m, from a loss of £88m last year. The company raised the cost-savings target for this year by £10m to £55m.
Simon Baker, analyst at SG Securities, said Reuters had delivered "great profit number" but the positive news from the company had largely been anticipated.
David Grigson, group finance director, said Reuters was "on target" but it would take a "remarkable turnaround in events" for the company to see revenue growth in 2004 compared with 2003.
"This is not a cycle with a V-shaped recovery. We are not going to see things fire up again in 2004. The next couple of years are going to be reasonably tough," Mr Grigson said.
Johnathan Barrett, analyst at Teather & Greenwood, forecast that revenues would contract some 7 per cent next year.
He said: "People had got far too excited [about Reuters shares]. There's a very large restructuring programme here. The size of the task should not be underestimated."
Sales of the tablet are set to fall again, say analysts
Met Police confirm there was a 'minor disturbance' and that no-one was arrested
George Lucas criticises the major Hollywood film studios
Does Chris Grayling realise what a vague concept he is dealing with?
Trend which requires crisps, a fork and a strong stomach is sweeping Mexico's streets
Parties threaten resort's image as a family destination
I Am Bread could actually be a challenging and nuanced title
- 1 Indian footballer Peter Biaksangzuala dies after injuring spine doing somersault celebration
- 4 Drink alcohol and eat meat to improve male fertility - but cut down on coffee, studies suggest
- 5 Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
Banksy arrest hoax: Internet duped by fake report claiming that the street artist's identity has been revealed
'Russian submarine spotted' by Swedish military off coast of Stockholm
Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
Kentucky gang rape: 15-year-old boy left in critical condition after sexual attack by group at party
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Residents should throw a street party and mix with immigrant neighbours, councils told
Russell Brand threatened with arrest after filming outside Fox News headquarters
London bus driver allegedly kicks gay couple off for kissing
Amal Alamuddin calls for the return of the Elgin Marbles from Britain: 'Injustice has persisted for too long'
Lord Freud: Tory welfare minister apologises after saying disabled people are 'not worth’ the minimum wage
iJobs Money & Business
£18 - 23k + Benefits: Guru Careers: We are seeking a Customer Service Executiv...
£60 - 65k + Benefits: Guru Careers: We are seeking a ASP.NET Web Developer / ....
£60,000 - £80,000: Saxton Leigh: Our client is an leading Asset Manager based...
£27000 - £32000 Per Annum: Clearwater People Solutions Ltd: Our large charity ...