Thomson Reuters Expects FY24 Revenue Growth of ~ 6.5% Vs $7.19B Est and Organic Revenue Growth of ~ 6%, Q1 Organic Revenue Growth of ~8%
Thomson Reuters expects FY24 revenue growth of approximately 6.5% and organic revenue growth of around 6%. Q1 organic revenue growth is projected to be about 8%. The company anticipates an adjusted EBITDA margin of around 40% and operates in an uncertain macroeconomic environment. The 2025-2026 financial framework targets organic revenue growth of 6.5%-8% and adjusted EBITDA margin expansion.
2024 Outlook
The company's outlook for 2024 in the table below assumes constant currency rates and incorporates the recent Pagero and World Business Media acquisitions but excludes the impact of any future acquisitions or dispositions that may occur during the remainder of the year. Thomson Reuters believes that this type of guidance provides useful insight into the anticipated performance of its businesses.
The company expects its first-quarter 2024 organic revenue growth to be approximately 8%, boosted by the expectation for additional AI licensing revenue at Reuters. The company also anticipates an adjusted EBITDA margin of approximately 40%, benefiting from normal seasonal strength and the Reuters licensing revenue, partially offset by M&A dilution and select growth investments.
The company continues to operate in an uncertain macroeconomic environment, reflecting ongoing geopolitical risk, uneven economic growth and an evolving interest rate and inflationary backdrop. Any worsening of the global economic or business environment could impact the company's ability to achieve its outlook.
Reported Full-Year 2023 Results and Full-Year 2024 Outlook
| Total Thomson Reuters | FY 2023 Reported | FY 2024 Outlook |
| Total Revenue Growth | 3 % | ~ 6.5% |
| Organic Revenue Growth(1) | 6 % | ~ 6% |
| Adjusted EBITDA Margin(1) | 39.3 % | ~ 38% |
| Corporate Costs | $115 million | $120 - $130 million |
| Free Cash Flow(1) | $1.9 billion | ~ $1.8 billion |
| Accrued Capex as % of Revenue(1) | 7.8 % | ~ 8.5% |
| Depreciation & Amortization of Computer Software Depreciation & Amortization of Internally Developed Software Amortization of Acquired Software | $628 million $556 million $72 million | $730 - $750 million $595 - $615 million ~ $135 million |
| Interest Expense (P&L) | $164 million(2) | $150 - $170 million |
| Effective Tax Rate on Adjusted Earnings(1) | 16.5 % | ~ 18% |
| "Big 3" Segments(1) | FY 2023 Reported | FY 2024 Outlook |
| Total Revenue Growth | 3 % | ~ 8% |
| Organic Revenue Growth | 7 % | ~ 7.5% |
| Adjusted EBITDA Margin | 43.8 % | ~ 43% |
| (1) | Non-IFRS financial measures. See the "Non-IFRS Financial Measures" section below as well as the tables and footnotes appended to this news release for more information. |
| (2) | Full-year 2023 interest expense excludes a $12 million benefit from the release of a tax reserve that is removed from adjusted earnings. |
2025-2026 Financial Framework
For the 2025-2026 period, the company targets an organic revenue growth range of 6.5%-8%, driven by 8%-9% for the "Big 3" segments. The company targets adjusted EBITDA margin expansion of approximately 75 basis points in 2025, followed by at least 50 basis points in 2026. It anticipates accrued capital expenditures as a percentage of revenues to be approximately 8%, and 2026 free cash flow to range from $2.0-$2.1 billion.
