Thomson Reuters to slash 3,200 jobs in next 2 years

TORONTO: Thomson Reuters Corp said on Tuesday that it would cut its workforce by 12% in the next two years, axing 3,200 jobs, as part of a plan to streamline the business and reduce costs.

The news and information provider, which completed the sale of a 55% stake in its Financial & Risk (F&R) unit to private equity firm Blackstone Group LP, announced the cuts during an investor day in Toronto.

The company, which is focusing on its legal and tax businesses following the F&R deal, declined to say where the job cuts were being made.

However, co-chief operating officer Neil Masterson told investors that staff had already been informed about 90% of the planned cuts.

“They laid out some good plans for the next couple of years,” said Edward Jones analyst Brittany Weissman. “I think there is still a long road ahead, but it was positive. They explained in more detail the pathway to more organic growth.”

The company aims to grow annual sales by 3.5% to 4.5% by 2020, excluding the impact of any acquisitions.

Chief executive Jim Smith said the company planned to cross-sell more products to existing customers and to attract new customers.

“It will also cut the number of products it sells,’’ he said.

“We’re going to simplify the company in every way that we can, working on sales effectiveness and on ways to make it easier both for our customers to do business with us and for our frontline troops to navigate inside the organisation,” Smith said.

As part of the streamlining, the company said it planned to reduce the number of offices around the world by 30% to 133 locations by 2020.

Following the F&R deal, about 43% of Thomson Reuters revenues come from its legal business, with 23% of sales coming from corporate clients and 15% of sales coming from its tax business.

Reuters News accounts for only 6% of sales but Smith said it remained a key part of the business under Michael Friedenberg, who joined the company on Monday as president of its news and media operations.

“We believe he can make Reuters News an even greater part of our growth story going forward,” Smith said.

Thomson Reuters set a target to reduce its capital expenditure to between 7% and 8% of revenue in 2020 from 10% currently.

The company has set aside $2 billion of the $17 billion proceeds from the F&R deal to make purchases to help grow its legal and tax businesses.