Release of Thomson Reuters Second-Quarter 2009 Report

NEW YORK, NY - August 10, 2009 - Thomson Reuters (NYSE: TRI; TSX: TRI; LSE: TRIL; NASDAQ: TRIN) today announced that it has filed a quarterly report for the period ended June 30, 2009 containing management's discussion and analysis and related financial statements. Thomson Reuters previously announced its second-quarter earnings through a news release on August 6, 2009. Please see Appendix A of this announcement for a copy of the second-quarter report. 

The second-quarter report is also available at www.thomsonreuters.com within the "Investor Relations" section of the website.  The report is being filed with the Canadian securities regulatory authorities and will be available on the SEDAR website at www.sedar.com, and it is being furnished to the U.S. Securities and Exchange Commission on Form 6-K and will be available at www.sec.gov.  A copy of the report will be available shortly at the UKLA Document Viewing Facility of the Financial Services Authority at 25 The North Colonnade, London E14 5HS, United Kingdom. 

Thomson Reuters primary financial statements are the consolidated financial statements of Thomson Reuters Corporation contained in the second-quarter report. Those statements account for Thomson Reuters PLC as a subsidiary and have been prepared in accordance with IFRS. The second-quarter report announced today also comprises the Thomson Reuters PLC half-yearly financial report for purposes of the U.K. Disclosure and Transparency Rules. 

About Thomson Reuters:

Thomson Reuters is the world's leading source of intelligent information for businesses and professionals.  We combine industry expertise with innovative technology to deliver critical information to leading decision makers in the financial, legal, tax and accounting, healthcare and science and media markets, powered by the world's most trusted news organization. With headquarters in New York and major operations in London and Eagan, Minnesota, Thomson Reuters employs more than 50,000 people and operates in over 100 countries.  Thomson Reuters shares are listed on the New York Stock Exchange (NYSE: TRI); Toronto Stock Exchange (TSX: TRI); London Stock Exchange (LSE: TRIL); and Nasdaq (NASDAQ: TRIN). For more information, go to www.thomsonreuters.com.

Contacts:

  Appendix A

MANAGEMENT'S DISCUSSION AND ANALYSIS

This management's discussion and analysis is designed to provide you with a narrative explanation of our financial condition and results of operations through the eyes of our management. We recommend that you read this in conjunction with our consolidated financial statements for the period ended June 30, 2009. We also recommend that you read our amended management's discussion and analysis and amended consolidated financial statements for the three months ended March 31, 2009, which reflect the initial presentation of our results and financial position under International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB), as well as our consolidated financial statements for the year ended December 31, 2008, which were prepared in accordance with generally accepted accounting principles in Canada (Canadian GAAP), and our management's discussion and analysis for the year ended December 31, 2008. References in this discussion to "$" and "US$" are to U.S. dollars, references to "C$" are to Canadian dollars and references to "£" are to British pounds sterling. References to our "2008 annual report" are to Thomson Reuters Corporation's annual information form and annual report on Form 40-F for the year ended December 31, 2008, which information was also included in Thomson Reuters PLC annual report on Form 20-F for the year ended December 31, 2008. Unless otherwise indicated or the context otherwise requires, references in this discussion to "we," "our," "us" and "Thomson Reuters" are to Thomson Reuters Corporation, Thomson Reuters PLC and their respective subsidiaries which operated as a unified group under a dual listed company (DLC) structure for the periods covered by this report. References to "Reuters" are to Reuters Group PLC, which we acquired on April 17, 2008. In order to provide comparable information to our 2009 results, we have included 2008 pro forma financial information in the section entitled "Results of Operations". This management's discussion and analysis also contains forward-looking statements. Readers are cautioned that these forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements. Some of these factors include those identified in the section entitled "Cautionary Note Concerning Factors That May Affect Future Results". This management's discussion and analysis is dated as of August 7, 2009.

OVERVIEW

Our Business and Strategy

Who we are and what we do - We are the leading source of intelligent information for businesses and professionals. We combine industry expertise with innovative technology to deliver critical information to leading decision-makers. Through more than 50,000 people in over 100 countries, we deliver this must-have insight to the financial, legal, tax and accounting, healthcare and science and media markets, powered by the world's most trusted news organization.

April 17, 2009 marked the one-year anniversary of our acquisition of Reuters for approximately $16 billion. As a result of this transaction, we are a much larger and more global company.

How we make money - We serve a wide variety of customers with a single, tested business model. We derive the majority of our revenues from selling electronic content and services to professionals, primarily on a subscription basis. Over the years, this has proven to be capital efficient and cash flow generative, and it has enabled us to maintain leading and scalable positions in our chosen markets. Within each of the markets we serve, we bring in-depth understanding of our customers' needs, flexible technology platforms, proprietary content and scale. We believe our ability to embed our solutions into customers' workflows is a significant competitive advantage as it leads to strong customer retention.

Our operational structure - We are organized in two divisions:

In the first quarter of 2009, we reorganized certain parts of our Professional division to reflect the global nature of our business, focus on key growth opportunities and increase efficiency.

We have restated our 2008 segment results to be comparable to our 2009 presentation.

We also report a Corporate and Other category that principally includes corporate expenses, certain share-based compensation costs, certain fair value adjustments and integration program costs. In 2008, this category also included transaction costs associated with the Reuters acquisition.

Our business environment - We are a global business and many of our customers have operations around the world. This is an important element of our growth strategy. We operate in over 100 countries and, accordingly, we need to ensure our offerings reflect the global economy, our brand has international appeal, and our global footprint allows us to capitalize on new opportunities such as the growth of professional workers in emerging economies and the expansion of our existing customers into new geographic areas.

As a global organization, we are affected by economic and market dynamics, governmental regulations and business conditions of each market and country in which we operate. The global economic environment continues to be fragile and remains challenging to our business. However, there are indications of economic stabilization as government interventions around the world helped to curtail the economic decline that began last September. Bank collapses and emergency mergers lessened and large law firm layoffs decreased significantly from levels in the first quarter of 2009.

Despite the weak global economy and its impact on our customers, our revenues continued to grow organically in the second quarter of 2009. The recurring revenues from our core products and services increased, while revenues from ancillary, transaction-based and outright offerings declined. We believe that the resilient performance of our recurring offerings and our diverse product portfolio and geographic presence will enable us to achieve our 2009 outlook, which is discussed in the "Outlook" section of this management's discussion and analysis.

In the second quarter of 2009, the U.S. dollar strengthened against other major currencies, such as the British pound and Euro, compared to the second quarter of 2008. This strengthening negatively impacted the amount of revenues we reported in U.S. dollars, but had a positive effect on operating profit margins.

Our 2009 priorities - Despite the challenging business environment, we continue to focus on our priorities for 2009 which are to:

Our corporate structure - We currently operate under a DLC structure, with shareholders in two publicly listed entities, Thomson Reuters Corporation, an Ontario, Canada corporation and Thomson Reuters PLC, a public limited company registered in England and Wales. The DLC structure was created as a means for Reuters shareholders to stay invested in our shares and participate in our growth as well as a way to attract and retain new U.K. investors. When we created the DLC structure, we believed these advantages outweighed the division of our trading liquidity into two principal pools and maintaining a more complicated capital structure.

However, since the DLC was announced, U.K. shareholder ownership has declined and now only represents approximately 5% of our total outstanding shares. Given these changes to our shareholder base, in June 2009 we announced a plan to unify the DLC. We believe unification is in the best interests of shareholders, as it will consolidate and improve the trading of our shares in a single deep, global pool of liquidity and simplify our capital structure. Unification will also reduce costs and complexity across our company.

On August 7, 2009, our shareholders approved the unification proposal. Unification also requires U.K. court approval, which we intend to seek on August 25, 2009. We expect unification to close on or about September 10, 2009 and the last day of trading of Thomson Reuters PLC ordinary shares and American Depositary Shares (ADSs) on the London Stock Exchange and Nasdaq, respectively, would be September 9, 2009. See the "Subsequent Events" section of this management's discussion and analysis for additional information.

Under the unification proposal, we will exchange each outstanding Thomson Reuters PLC ordinary share for one Thomson Reuters Corporation common share. Each outstanding Thomson Reuters PLC ADS will be exchanged for six Thomson Reuters Corporation common shares. Current holders of Thomson Reuters Corporation common shares will continue to hold their existing shares. Following unification, our shares will remain listed on the Toronto and New York stock exchanges. Thomson Reuters PLC (to be renamed Thomson Reuters UK Limited following unification) will become a wholly-owned subsidiary of Thomson Reuters Corporation. Unification is a change to our corporate structure that will have no impact on our global businesses, operations, strategy, financial position or employees.

As of August 7, 2009, The Woodbridge Company Limited and other companies affiliated with it (Woodbridge) had a voting interest in Thomson Reuters of approximately 55% based on the aggregate issued share capital of Thomson Reuters Corporation and Thomson Reuters PLC. The former holders of Thomson Reuters PLC ordinary shares and existing holders of Thomson Reuters Corporation common shares, including our controlling shareholder, Woodbridge, will continue to have the same ownership interest in Thomson Reuters after the unification as they currently do under the DLC structure. See the section entitled "Related Party Transactions" for additional information about our recent transactions with Woodbridge.

Our financial statements - Our primary financial statements are the consolidated financial statements of Thomson Reuters Corporation. These statements account for Thomson Reuters PLC as a subsidiary and have been prepared in accordance with IFRS. We recently adopted IFRS commencing with our amended interim financial statements for the three months ended March 31, 2009 that were filed on July 23, 2009. Previously, our financial statements were prepared in accordance with Canadian GAAP.

Results for Reuters are included in our consolidated financial statements beginning April 17, 2008. For informational purposes, we have also included Thomson Reuters results for 2008 on a pro forma basis in this management's discussion and analysis, which present the hypothetical performance of our business as if Thomson had acquired Reuters on January 1, 2007. See the sections of this management's discussion and analysis entitled "Acquisition of Reuters" and "Results of Operations" for more information.

As required by our DLC structure, we also prepare standalone Thomson Reuters PLC consolidated financial statements. If unification occurs, we will no longer prepare these financial statements.

Seasonality

Prior to the acquisition of Reuters, our revenues and operating profits from continuing operations were proportionately the smallest in the first quarter and the largest in the fourth quarter, as certain product releases were concentrated at the end of the year, particularly in the regulatory and healthcare markets. Costs were incurred more evenly throughout the year. Our operating margins historically increased as the year progressed. For these reasons, performance was not comparable quarter to consecutive quarter and was best considered on the basis of results for the whole year or by comparing results in a quarter with the results in the same quarter for the previous year. As Reuters revenues and profits have not historically fluctuated as significantly throughout the year, the seasonality of our revenues and operating profits is now less pronounced. However, performance remains not comparable quarter to consecutive quarter and is best considered on the basis of results for the whole year or by comparing results in a quarter with the results in the same quarter for the previous year.

Acquisition of Reuters

On April 17, 2008, we acquired Reuters for approximately $16 billion. We combined the operations of Reuters with the former Thomson Financial segment to create a global leader in electronic information services, trading systems and news.

The components of the purchase consideration were as follows:

For additional details on the acquisition of Reuters, see note 6 to our financial statements for the six months ended June 30, 2009.

Integration Program

Given the accelerated progress we continue to make in our integration program, we now expect to achieve run-rate savings of at least $1 billion by year-end 2009, up from our previous estimate of $975 million. We have achieved $925 million of run-rate savings (against a total program target of $1.4 billion by 2011) as of June 30, 2009.

The savings we have achieved thus far are primarily associated with reductions in headcount. The remaining savings expected to be achieved by the program are focused on technology and product rationalization. In 2009, we have been focused on this next phase of the Reuters acquisition integration, which includes:

Since these projects are longer in term, we expect increases in the program's run rate savings to be slower than what has been achieved thus far.

The table below summarizes the run-rate savings we have achieved and the minimum savings targets (including legacy efficiency programs) we expect to achieve by the end of 2009. Additionally, we set forth the savings targets we expect by program completion in 2011 and the actual and projected costs to achieve these savings.

* 2008 and total program costs exclude $68 million of transaction-related expenses.

Costs associated with these efforts primarily include severance and consulting expenses as well as costs associated with certain technology initiatives and branding. Because these are corporate initiatives, integration program expenses are reported within the Corporate and Other.

Use of Non-IFRS and Pro Forma Financial Measures

In addition to our results reported in accordance with IFRS, we use certain non-IFRS financial measures as supplemental indicators of our operating performance and financial position and for internal planning purposes. We have historically reported on non-IFRS financial results as we believe their use provides more insight into our performance.

As the Reuters acquisition closed on April 17, 2008, our 2009 results include the impact of the acquisition for the entire period, whereas 2008 only includes results from the closing date. Due to the significant impact of the Reuters acquisition on our results, we also include 2008 results on a pro forma basis to reflect the acquisition from the beginning of the period. This provides a more meaningful comparison of our performance in 2009 to 2008. Pro forma results do not reflect the actual results of our business.

The following is a description of our non-IFRS financial measures, including an explanation of why we believe they are useful measures of our performance, including our ability to generate cash flow.

In interim periods, we adjust our reported earnings and earnings per share to reflect a normalized effective tax rate. Specifically, the normalized effective rate is computed as the estimated full-year effective tax rate applied to the consolidated pre-tax income of the interim period. The reported effective tax rate is based on separate annual effective income tax rates for each taxing jurisdiction that are applied to each interim period's pre-tax income. Because the seasonality of certain of our businesses affects our geographical mix of profits in interim periods and therefore distorts the reported effective tax rate, we believe that using the expected full-year effective tax rate provides a more meaningful comparison among interim periods. The adjustment to normalize the effective tax rate reallocates estimated full-year income taxes between interim periods, but has no effect on full year tax expense or on cash taxes paid.

See the reconciliation of adjusted earnings from continuing operations to the most directly comparable IFRS measure in the "Results of Operations" section of this management's discussion and analysis.

Non-IFRS measures do not have any standardized meaning prescribed by IFRS and, therefore, are unlikely to be comparable with the calculation of similar measures used by other companies. You should not view these measures as alternatives to measures of financial performance calculated in accordance with IFRS.

RESULTS OF OPERATIONS

Basis of Presentation

We discuss our results from continuing operations as presented in our income statement. Our results from continuing operations include the performance of acquired businesses from the date of their purchase and exclude results from businesses classified as discontinued operations. In order to compare the performance of our ongoing businesses, we remove the results of businesses that could not be classified as discontinued operations. Therefore, our results from ongoing businesses exclude both discontinued operations and other businesses sold or held for sale. In analyzing our revenues, we measure the performance of existing businesses, the impact of acquired businesses and of foreign currency.

Consolidated Results - 2009 IFRS Basis Compared to 2008 Pro Forma Basis

The following table summarizes selected financial information:

We compare our 2009 results of operations to 2008 pro forma financial information because the period-to-period comparison of our IFRS results did not allow for a sufficient understanding of the underlying trends of our business due to the timing of the closing of the Reuters acquisition and certain special items. Because our 2008 pro forma results include the effects of the Reuters acquisition from the beginning of the period, we believe they provide a more meaningful basis of comparison against our 2009 performance. Our 2008 pro forma information:

Revenues. Revenues decreased 4% in both the three-month and six-month periods ended June 30, 2009 compared to the prior year periods. The following table provides information about our revenues from ongoing businesses:

n/m = not meaningful.

Revenues from ongoing businesses decreased 4% in both the three and six months ended June 30, 2009. Excluding the effects of foreign currency, these revenues increased 2% in the respective periods. In general, the trends within our businesses from the first quarter of 2009 continued through the second quarter. Recurring revenues from our core products increased and were partly offset by decreased print, ancillary and transaction-related revenues that have been more sensitive to the economic environment. Revenues from acquired businesses were primarily from our December 31, 2008 acquisition of Paisley, a provider of governance, risk and compliance solutions in our Tax & Accounting segment, as well as other tactical acquisitions.

Operating profit. The following table provides information about our operating profit, including a reconciliation to underlying operating profit:

For the three months ended June 30, 2009, operating profit increased $183 million, or 63%, compared to the prior year period. For the six months ended June 30, 2009, operating profit increased $95 million, or 13%, compared to the prior year period. Comparability was affected by an impairment charge in the prior year, spending on integration program costs and fair value adjustments. Operating profit in 2008 included impairment charges of $89 million related to our Dialog business, which was sold in July 2008. Integration program costs varied in each period due to the timing of spending. Fair value adjustments were associated with foreign currency embedded derivatives, and reflected foreign currency exchange rates of the respective periods.

For the three months ended June 30, 2009, underlying operating profit increased $80 million, or 11%, compared to the prior year period and the corresponding profit margin increased 330 basis points to 24.2%. For the six months ended June 30, 2009, underlying operating profit increased $81 million, or 6%, compared to the prior year period and the corresponding profit margin increased 200 basis points to 21.6%. These increases were principally due to lower expense as a result of integration-related savings and cost control efforts across our businesses, as well as a favorable impact from foreign currency. Foreign currency was attributable to approximately one-third of to the improvement in our underlying operating profit margin for the three-month period and approximately half for the six-month period.

Adjusted earnings and adjusted earnings per share from continuing operations. The table below presents our adjusted earnings calculation for the three months and six months ended June 30, 2009 compared to our pro forma adjusted earnings for the comparable periods in 2008. 

Our adjusted earnings and adjusted earnings per share from continuing operations increased compared to the prior year period principally due to higher underlying operating profit and lower integration related costs. A lower effective tax rate also contributed to the increase in adjusted earnings.

Consolidated Results - IFRS Basis

The following table summarizes selected financial results for the periods indicated:

Revenues. Revenues increased 5% and 29% in the three months and six months ended June 30, 2009, respectively, compared to the prior year periods. For the three month period, the increase was comprised of the following:

For the six month period, the increase as comprised of the following:

The contributions from acquired businesses were primarily attributable to the Reuters acquisition, which was completed April 17, 2008, as well as our acquisition of Paisley, which is part of our Tax & Accounting segment. Revenue increases were also attributable to increases from existing businesses in our Professional division, particularly in our Tax & Accounting and Healthcare & Science segments.

Operating profit. Operating profit increased 87% and 77% in the three months and six months ended June 30, 2009, respectively, compared to the prior year periods due to the increase in revenues, the favorable impact of savings from integration programs and the inclusion of an impairment charge in our prior year results. Operating profit also benefited from the favorable effects of foreign currency compared to the prior year periods. The effects of higher revenues on operating profit were partially offset by integration program costs. However, the current three-month period reflects lower integration program costs, offset by unfavorable fair value adjustments. Due to the timing of the closing of the Reuters acquisition, the six-month period reflects significant increases to depreciation and amortization of computer software and amortization of other intangible assets, whereas the effects on the three-month period were more moderate compared to the prior year.

Operating expenses. Operating expenses increased 1% and 25% in the three months and six months ended June 30, 2009, respectively, compared to the prior year periods. These increases primarily reflected additional expenses associated with the acquired Reuters business partially offset by the impact of foreign currency. Staff costs, which include salaries, bonuses, commissions, benefits, payroll taxes and share-based compensation, represented the largest category of expenditures. Excluding the effects of foreign currency, staff costs decreased as a percentage of total operating expenses due to the impact of our integration programs. Staff costs decreased as a percentage of revenues as a result of the impact of our integration programs and the benefits of scale from increased revenues.

Depreciation. Depreciation expense for the three months ended June 30, 2009 approximated that of the prior year period. For the six months ended June 30, 2009, depreciation expense increased $75 million, or 45%, compared to the prior year period. These results reflected increased expense associated with the acquired Reuters assets, as well as capital expenditures from existing businesses. The effects of foreign currency offset the increased expense in the three-month period and partially offset the increased expense in the six-month period.

Amortization of computer software. Amortization of computer software for the three months ended June 30, 2009 approximated that of the comparable prior year period. For the six months ended June 30, 2009, amortization of computer software increased $65 million, or 32%, compared to the prior year period. These results reflected increased expense associated with the acquired Reuters assets, as well as capital expenditures from existing businesses. The effects of foreign currency offset the increased expense in the three-month period and partially offset the increased expense in the six-month period.

Amortization of other intangible assets. Amortization of other intangible assets increased $6 million, or 5%, and $63 million, or 35%, for the three months and six months ended June 30, 2009, respectively, compared to the prior year periods. These increases reflected amortization of the acquired Reuters assets. The effects of foreign currency partially offset these increases. Relative to our other businesses, amortization of other intangible assets approximated that of the prior year as increased expense from newly-acquired assets was offset by the completion of amortization for certain identifiable intangible assets acquired in previous years.

Impairment of assets held for sale. In conjunction with our decision to sell our Dialog business, we recognized a charge of $89 million for the impairment of its intangible assets in the three months ended June 30, 2008.

Net interest expense. Net interest expense of $104 million and $200 million for the three months and six months ended June 30, 2009, respectively, reflected higher borrowings associated with financing the Reuters acquisition as compared to the prior year periods. Net interest expense for the three months and six months ended June 30, 2008 also reflected interest income from the investment of the proceeds from the sale of our former Learning businesses in money market funds prior to using these funds towards the cash portion of the Reuters acquisition consideration on May 1, 2008.

Other finance costs. Other finance costs were $34 million and $57 million for the three months and six months ended June 30, 2009, respectively. These amounts primarily consisted of losses on freestanding derivatives and ineffectiveness on certain hedging derivative instruments and losses from changes in foreign currency exchange rates on certain intercompany funding arrangements. Accounting rules require that foreign currency gains and losses on intercompany arrangements are recognized in earnings when these arrangements are settled, or when they are not considered permanent in nature.

Other finance costs were $44 million and $72 million for the three months and six months ended June 30, 2008, respectively. These amounts primarily consisted of losses from changes in foreign currency exchange rates associated with the cash consideration for the Reuters acquisition. See the section entitled "Hedging Program for Reuters Consideration" for further discussion.

Share of post-tax earnings in equity method investees. For the three months ended June 30, 2009, our share of earnings in equity method investees was negligible. For the six months ended June 30, 2009, our share of earnings in equity method investees was $1 million. For the three months and six months ended June 30, 2008, our share of earnings in equity method investees was $1 million.

Tax expense. Tax expense for the three-month and six-month periods ended June 30, 2009 and 2008 reflected the mix of taxing jurisdictions in which pre-tax profits and losses were recognized. The consolidated effective tax rates in respect of continuing operations for the three months ended June 30, 2009 and 2008 were 4.2% and 0.6%, respectively, and for the six months ended June 30, 2009 and 2008 were 13.9% and 11.5%, respectively. Seasonality in our businesses can affect our geographic mix of pre-tax profits and losses in interim periods and, therefore, distort our reported tax rate. Consequently, our effective tax rate in interim periods is not necessarily indicative of our estimated effective tax rate for the full year.

In the third quarter of 2009, we expect to record tax benefits of approximately $550 million related to the release of deferred tax liabilities that will no longer be required as a result of an anticipated intercompany sale of assets. This transaction will have no cash impact. Excluding this benefit, we expect the full year effective income tax rate on our adjusted earnings to be in the range of 20% to 22% compared to 25% in the prior year.

Net earnings and earnings per share. Net earnings were $325 million in the three months ended June 30, 2009 compared to net earnings of $154 million in the prior year period. Diluted earnings per share were $0.38 in the three months ended June 30, 2009 compared to $0.19 in the prior year period. Net earnings were $518 million in the six months ended June 30, 2009 compared to net earnings of $349 million in the prior year period. Diluted earnings per share were $0.60 in the six months ended June 30, 2009 compared to $0.47 in the prior year period. Net earnings increased in both periods as higher operating profit exceeded increased interest expense and higher tax expense. Diluted earnings per share in both the three-month and six-month periods ended June 30, 2009 also reflected an increase in our number of shares outstanding, as we issued approximately 194 million shares as part of the Reuters acquisition consideration on April 17, 2008.

Segment Results

A discussion of the operating results of each segment follows. Our definition of segment operating profit as reflected below may not be comparable to that of other companies. We define segment operating profit as operating profit before (i) amortization of other intangible assets; (ii) other operating gains and losses; and (iii) asset impairment charges. We use this measure for our segments because we do not consider these excluded items to be controllable operating activities for purposes of assessing the current performance of our segments. We also use segment operating profit margin, which we define as segment operating profit as a percentage of revenues.

As with our consolidated results, we compare the 2009 results of our Markets division to 2008 pro forma financial information because the period-to-period comparison of our IFRS results does not allow for a sufficient understanding of the underlying trends of our business due to the timing of the closing of the Reuters acquisition. Results for our Professional division were not impacted by the Reuters acquisition.

We have reclassified certain revenue streams within our Markets segment from our Media business unit to our Sales & Trading business unit as described within the "Markets division" results of operations discussion below. We have also restated our 2008 segment results to be comparable to our 2009 presentation as described within the "Professional division" results of operations discussion below.

Markets division

2009 IFRS Basis Compared to 2008 Pro Forma Basis Results

The following tables provide information about revenues and segment operating profit calculated in accordance with IFRS for 2009 results and on a pro forma basis for 2008 results:

Revenues decreased 7% in both the three months and six months ended June 30, 2009 as a result of unfavorable changes in foreign currency exchange rates. Revenues from existing businesses, which exclude the effects of foreign currency, were comparable to the prior year period as an increase in recurring revenues was offset by lower transaction-based revenues and lower outright revenues.

The increase in recurring revenues was driven by Enterprise information partially offset by lower recoveries.  Recoveries are low margin revenues that we collect and forward to a third-party provider, such as stock exchange fees.  Non-recurring transaction-based revenues decreased due to lower volumes in our foreign exchange business and Omgeo, our trade processing joint venture, partially offset by increased Tradeweb revenues. Outright revenues declined as a result of lower sales of our large software systems. In the three month period ended June 30, 2009, we also benefitted from certain one-time revenues. Geographically, revenues increased in Asia and Europe, the Middle East and Africa (EMEA) offsetting decreased revenues in the Americas.

An analysis of revenues from our existing businesses is as follows:

The increases in segment operating profit and the related margin for the three months and six months ended June 30, 2009 were principally due to savings from integration programs and cost control efforts, as well as favorable effects from foreign currency, which more than offset the impact of lower revenues. In the three-month period, approximately one quarter of the improvement in the segment operating profit margin was attributable to foreign currency. In the six-month period, approximately one third of the improvement in the segment operating profit margin was attributable to foreign currency.

We believe segment operating profit margin has reached a peak until revenues increase in conjunction with the economic recovery.

IFRS Results

The following table provides information about revenues and segment operating profit on an IFRS basis:

Compared to 2008 results on an IFRS basis, revenues for the three months and six months ended June 30, 2009 increased 10% and 63%, respectively, compared to the prior year periods. Excluding the effect of foreign currency, revenues for the three months and six months ended June 30, 2009 increased 18% and 75%, respectively, compared to the prior year periods. These increases were due to the acquisition of Reuters as in both periods revenues from existing businesses approximated that of the prior year. Segment operating profit for the three months and six months ended June 30, 2009 increased 50% and 94%, respectively, compared to the prior year periods primarily due to the acquisition of Reuters. The increases in segment operating profit and the related margin also reflected the realization of benefits from our integration program, as well as a favorable effect from foreign currency.

Professional division

In the first quarter of 2009, we reorganized the Professional division into three segments: Legal, Tax & Accounting and Healthcare & Science. The Tax & Accounting segment now includes certain international businesses previously reported in the Legal segment. An intellectual property business that combines Professional division-wide capabilities related to patents, trademarks and standards is now managed within the Legal segment. The Healthcare & Science segment now manages the Healthcare businesses as well as the operations of the former Scientific segment which serve the pharmaceutical, academic and government markets. Segment information for the three and six months ended June 30, 2008 was restated to reflect this organizational structure.

The following tables summarize revenues for the three and six months ended June 30, 2009 and 2008:

n/m = not meaningful.

The following table summarizes operating profit for the three and six months ended June 30, 2009 and 2008:

n/m = not meaningful.

Revenues for our Professional division decreased 1% in the three months ended June 30, 2009 as compared to the prior year. For the six months ended June 30, 2009, revenues were comparable to that of the prior year. These results include our Dialog business that was sold in July 2008 as well as our PDR (Physicians' Desk Reference) and PLM (a provider of drug information in Latin America) businesses, which we intend to sell. We report these businesses as disposals as they do not qualify to be reported as discontinued operations. The following discussion regarding our performance is related to our ongoing businesses.

In both the three months and six months ended June 30, 2009, revenues from ongoing businesses increased 1% compared to the prior year. Excluding the effects of foreign currency, revenues from ongoing businesses in both periods increased 4% compared to the prior year. In the three months ended June 30, 2009, this increase was comprised of 2% from existing businesses and 2% from acquired businesses while, in the six months ended June 30, 2009, the increase was comprised of 3% from existing businesses and 1% from acquired businesses. The increases in revenues from existing businesses were primarily from our non-print subscription-based online products and software and services. These increases were partially offset by lower print, ancillary and other discrete revenues which have been more sensitive to the economic downturn. Revenues from acquired businesses reflected contributions from acquisition of Paisley and other tactical acquisitions.

In both the three months and six months ended June 30, 2009, segment operating profit from ongoing businesses increased 3% compared to the prior year. The related margins increased 80 basis points to 31.3% for the three-month period of 2009 and 40 basis points to 28.0% for the six-month period of 2009. For the three months ended June 30, 2009, the increases in segment operating profit and the related margin were due to a favorable impact of foreign currency, as well as the impact of efficiency programs and cost controls, partially offset by the impact of lower initial margins from acquisitions. For the six months ended June 30, 2009, the increases in operating profit and the related margin were due to favorable foreign currency.

The segment operating profit margin is expected to decrease slightly in the second half of 2009 due to a shift in revenue mix to higher-growth, but lower-margin software and services products, lower initial margins from acquisitions and investments in global expansion initiatives and technology infrastructure.

Legal

In the three months and six months ended June 30, 2009, revenues decreased 2% and 1%, respectively, compared to the prior year. Excluding the effects of foreign currency, revenues for the three months and six months ended June 30, 2009 increased 2% and 3%, respectively. Revenues from existing businesses increased 1% in both periods as a result of the following:

Within our West business, revenues increased from small law firms and government agencies for both the three months and six months ended June 30, 2009 compared to the prior year periods. However, revenues from large law firms were comparable to the prior year periods reflecting cost controls by those firms, which has resulted in the lower ancillary revenues described above. Results from our intellectual property customers were mixed as increased revenues from our managed services offerings offset decreased revenues from our transaction-based trademarks business.

Segment operating profit for the three months ended June 30, 2009 was comparable to that of the prior year. For the six months ended June 30, 2009, segment operating profit increased 2% compared to the prior year. These results reflected the benefits of cost controls and efficiency initiatives begun earlier in the year. In the three months ended June 30, 2009, segment operating profit margin increases were attributable to favorable foreign currency and the effects of tight cost controls and efficiency initiatives. For the six months ended June 30, 2009, segment operating margin increases were attributable to favorable currency.

The segment operating profit margin is expected to decline in the second half of 2009 due to a less favorable revenue mix and investments in new products.

Tax & Accounting