Reuters Stock Falls On Slower Q2 Warning

News and information group Reuters has this morning posted a strong set of financial results that show first quarter revenues rising 17% to £970 million. However, chief executive Peter Job warned that growth in the second quarter would be at a “slightly lower rate”.

The group says that good performances at its Reuters Financial and Instinet divisions contributed to the underlying revenue growth (which excludes the impact of acquisitions, disposals and currency movements) of 10%. Subscription-based information products grew to £458 million, up 7% on an underlying basis, in line with growth levels achieved through 2000. Revenue growth was strong in the main economies of continental Europe and in the US.

Despite the results coming at the top end of expectations, shares in Reuters dipped heavily this morning as a result of the warning of slower growth in the second quarter. By 11:45am stock was down 39p (4%) at 936p.

“Revenue growth from Reuters core financial business in the first quarter continued the strong trend of the second half of last year. We anticipate that growth will continue in the current quarter at a slightly lower rate. Our business model remains robust based on repeat revenues which show no sign of eroding. The financial customer base is well diversified across many different types of institutions in over 50,000 locations worldwide,” said Peter Job in this morning’s statement.

Reuters: 020 7250 1122