Toronto, Canada based Thomson Reuters announced on Tuesday that it will cut its workforce by 12% in the next two years, axing 3200 jobs as part of a plan to streamline the business and reduce costs.
The news and information provider, which recently sold 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, in which it outlined its future strategy and growth plans.
The company 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.
The company aims to grow annual sales by 3.5 percent to 4.5 percent by 2020, excluding the impact of any acquisitions. Chief Executive Officer Jim Smith said it plans to cross-sell more products to existing customers and to attract new customers. “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 organization,” he said. “We believe he can make Reuters News an even greater part of our growth story going forward.”
“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.”
Thomson Reuters has 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 Blackstone deal to make purchases to help grow its legal and tax businesses.
Shares in Thomson Reuters have risen by 40 percent since May, benefiting from the company buying back $10 billion worth of shares. Following the news, shares in Thomson Reuters rose as much as 3.7% on Tuesday, hitting an all-time high.