Earnings: Reuters’ Profit Down 26 Percent For 1H06; Sales Up 12 Percent

Reuters Group’s [RTRSY) 1H06 numbers reflect the company’s transition as it sold several operations and acquired Telerate. First-half profit dropped 26 percent to 96 million pounds but sales rose 12 percent to 1.28 billion pounds while operating profit was up 16 percent to 122 million pounds. Reuters CEO Tom Glocer added some perspective during the analysts’ call: “As I’ve said all year, Reuters is a stock you should buy based on your belief on what we can achieve in 2007/2008 and beyond.”
John Blossom: The brightest story is in the growth of Reuters’ media sales, where revenues grew 14 percent in 1H06 and are up 47 percent from 1H05. At GBP 87 million the media division is still a relatively small contributor to overall profits but with a top 300 Web site and a successful syndication strategy Reuters news is managing both strong profits and strong brand development.
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