LONDON (AFP) – The news and financial information group Reuters has posted a better-than-expected increase in revenues over the third quarter.
Reuters also announced the sale of its 50-percent stake in online business information service Factiva to US partner Dow Jones.
Group revenues climbed by 3.3 percent to 631 million pounds (939 million euros, 1.18 billion dollars) in the three months to September 30, 2006, compared with the same period the previous fiscal year, Reuters said in an earnings release.
That was modestly higher than analysts’ consensus forecasts of 625 million pounds.
Revenue growth in the group’s current fiscal year was now forecast to hit the top end of its guidance of 5.0-6.0 percent.
Analysts expect Reuters to be able to achieve that thanks to a continuing boom in the investment banking industry.
Revenue grew by 5.3 percent on an underlying basis, which strips out the effects of currency movements, acquisitions and disposals.
“I am pleased with our progress in the third quarter, which was our strongest quarter of net sales so far this year,” Reuters chief executive Tom Glocer said in the results statement.
“Our underlying revenue growth of 5.3 percent demonstrates that Reuters’ core business is responding well to generally favourable market conditions.”
In a separate statement, Reuters said it would sell its Factiva stake to Dow Jones for 160 million dollars.
Glocer added: “We view this transaction as the natural conclusion to this successful joint venture.”
The Factiva online subscription news service was set up by the two companies in 1999, and will become a subsidiary of Dow Jones.
Reuters will continue to supply its news as a paid supplier, and has agreed not to compete with Factiva’s core business for a two-year period.
The company meanwhile revealed it has bought back 654 million pounds worth of stock under a 1.0-billion-pound share buy-back plan.