1. REED ELSEVIER Preliminary Results 1999 Strategy Presentation to Analysts 24 February 2000

2. Mark Armour Chief Financial Officer

3. Adjusted Profit and Loss 1999 1998 £m constant Turnover 3,3903,1915,1534,749+5% Adjusted operating profit 7928131,2041,210 -3% Operating margin 23.4% 25.5% 23.4% 25.5% Net interest expense(82)(40) (125)(60) Adjusted profit before tax7107731,0791,150-9% Adjusted figures exclude amortisation of goodwill and intangibles and exceptional items % change 1999 1998 m m

4. £m - Turnover - m£m - Operating Profit - m Science Underlying turnover and operating profit up 2% Adverse impact on subscription renewals of currency Over 25% of journal revenues include ScienceDirect Weakness in Excerpta Medica and France Turnover up 5%; Operating profit up 5%; Margin 35.4% 19981999199819991998199919981999

5. Legal Underlying revenue up 5%; operating profit down 12% Low revenue growth and increased investment at LEXIS-NEXIS Non US performed strongly, particularly UK and France Good sales and profit growth at Educational Turnover up 13%; Operating profit down 4%; Margin 24.9% 19981999199819991998199919981999 £m - Turnover - m£m - Operating Profit - m

6. Business Underlying revenue up 1%; operating profit down 11% Cahners revenues flat; profits down 40%; restructuring implemented in second half Recovery in advertising demand in Europe in second half Strong growth in annual exhibitions and launches Turnover up 2%; Operating profit down 9%; Margin 16.7% 19981999199819991998199919981999 £m - Turnover - m£m - Operating Profit - m

7. Adjusted Profit Before Tax - Reconciliation 1998 Adjusted profit before tax 773 1,150 Base businesses (58) -8% (86)-8% Acquisitions1-1 - Disposals (9)-1% (13)-1% Currency translation effect3 +1% 27+3% 1999 Adjusted profit before tax710-8%1,079-6% % % £m change mchange

8. Cash Flow 1999 199819991998 £m £mmm Adjusted operating cash flow780 8081,1861,203 % conversion 98% 99% 98% 99% Free cash flow186246284366 Acquisition spend(166)(1,232)(252)(1,833) Exceptional items (61)647(93)962 Total cash outflow(41)(339)(61)(505)

9. Earnings and Dividends Adjusted EPS-8%-5% Equalised dividends-33%-31% Growth versus 1998

10. Dividend Policy Policy realignment to support investment in Internet driven growth strategy Reduction by one third from 1998 level £115m/185m funds released 1999 total dividend 10.0p/0.27 2000 interim and final dividends realigned Long term dividend cover target of at least two times

11. Crispin Davis Chief Executive Officer

12. Highlights New Internet based strategy for growth Three core businesses supported by brands, content, market reach and scale Significant, detailed £750m/1,200m 3 year investment programme Strengthened management, re-emphasis of core disciplines and cost savings Commitment to superior shareholder returns

13. Vision Indispensable partner of scientist, lawyer and business professional Demonstrably superior information driven services and solutions, increasingly via the Internet Global capability and leadership in targeted sectors Organisational focus on customer, innovation and speed 2002 : Above market revenue growth Double digit earnings growth

14. Focus on Science, Legal and Business $6bn $7bn $10bn+ $8bn Science and Medical Legal and Tax Business Magazines Business Exhibitions Global Market Size 4-5% 5-6% 5% 6-7% Future Growth Large and Growing Markets 1

15. Focus on Science, Legal and Business Strong Market Positions 1

16. Leading Brands and Premium Content Focus on Science, Legal and Business 1

17. Upgrade Management Effectiveness Unitary management structure Creation of 3 global business divisions New management appointments to drive strategy Organisational separation of Internet activities Redefinition of head office structure and role Significantly enhanced incentive schemes 2

18. Deliver Demonstrably Superior Products and Services Internet is prime focus High value-added content Ease of use and functionality Customisation Solutions, not just information 3

19. Internet Revenue Development £1bn/1.6bn Internet revenues in 2002 through migration/new revenue streams 120 400 700 1000 £mm

20. Substantial Upgrade of Marketing and Sales Programmes Significant expansion of sales and customer service Focus on new user opportunities; expansion into new markets Customised pricing to reflect product value and customer needs Innovative, stand-out marketing behind e initiatives 4

21. Significant Increase in Investment Spend 5 50 60 80 260 £mm

22. Investment Spend by Division £mm 240 180 120 60 0 35 115 110

23. Aggressive Cost Saving Programme Total savings of over £170m/270m – 7% of 1999 cost base – headcount reduction of 1,500+ – over £130m/210m to be realised in 2000 Total restructuring cost up to £250m/400m – £161m/244m has been charged in 1999 6

24. Cost Savings - By Division

25. Build Global Capability and Leadership Global leadership is target in all 3 sectors Increasing globalisation driven by Internet Global divisional management and brand development Legal expansion in Continental Europe and South America Business to Business expansion in Continental Europe, Asia and South America 7

26. USSouthUKContAsia AmericaEurope Science Legal Business Geographical Presence

27. Target In-fill Acquisitions/Alliances to Accelerate Progress Enhance content/services for Internet portals Accelerate geographical expansion Increase emphasis on alliances for Internet capabilities $100m venture investment fund to support 3 core businesses Strong balance sheet to support investment 8

28. Key Acquisitions and Internet Alliances Science Legal Business Acquisitions Cell Press Library Tools Eclipse FT Profile Market Cast Interbev Internet Alliances Links to STM publishers Justice Link IBM Partminer U-bid Microsoft

29. Science: Strategic Initiatives Development of ScienceDirect; content and functionality Expansion and customisation to new usage groups Accelerated migration to electronic, supported by revised pricing Strengthened sales operation Upgrade back office and editorial systems

30. Family of Solutions Academic & Government Science Navigator Science Navigator Pro SD Onsite SD Online Physics Direct ScienceDirect Web Editions PhysicsWeb Editions SciTech Web Industrial & Corporate Engineering Navigator Chem. Navigator BioMed Navigator Engineering Web Editions ChemWeb Editions BioMed Web Editions Tech Web Chem Web BioMed Net Professional & Society Medical Village Paper Village Computer Village MedWeb Editions CardioWeb Editions NeuroWeb Editions Med Web CardioSource Neuro Web SOLUTIONSETSSOLUTIONSETS Growth in Core Markets Migration of Print Customers New Market Development MARKETS

31. Increased customer loyalty Science: Growth Path Migration to ScienceDirect Better product/ Higher usage New sectors Infill acquisitions Opportunity Today Over 60% of Scientific revenues from Internet by 2002

32. Legal: Key Initiatives Deliver demonstrable product superiority for online legal research Customisation of online products, e.g. large law, small law More aggressive and targeted sales and marketing Focus on early adoption at law schools Expansion into related professional areas Build global capability, brands and leadership

33. Aggressive marketing and sales programmes Legal: Growth Path Superior online research product User preference and share shift New geographic and sector markets Infill acquisitions Opportunity Today 40% of Legal revenues from Internet by 2002

34. Business to Business: Strategic Initiatives Create sector leading Internet portals Expand value chain into e-commerce Improve growth from core magazines and exhibitions portfolio Expansion in Continental Europe, Asia and South America Rationalisation of print and exhibition portfolio

35. Business to Business: Internet Focus Global Vertical Priorities (Learn, Find, Buy) EntertainmentEntertainment Horizontal Opportunities Jobs, News, etc. New Organisation & Technology Alliances ManufacturIngManufacturIng ElectronicsElectronics ConstructionConstruction etc.

36. Business to Business: Linking to e-Transactions Internet Trading Manufacturing. Net Chemical News Interactive Air Transport Intelligence @Computer Weekly Estates Gazette Interactive Totaljobs. com Variety.com E-Insite Buildingteam. com Chemicals Aerospace IT Real Estate Recruitment Entertainment Electronics Construction Manufacturing

37. Print and exhibitions investment Business to Business: Growth Path Full service Internet portals Traffic and e- commerce expansion Infill acquisitions Opportunity Today 10+% of Business to Business revenues from Internet by 2002 Geographical expansion

38. Reed Elsevier: Conclusions Strongly positioned businesses Robust, customer led growth strategy and plans Internet opportunity is fundamental Major investment programme Organisational issues being addressed Clear and progressive growth targets Total commitment to execution

39. APPENDICES

40. Turnover - Reconciliation % £m change m change 1998 Turnover3,1914,749 Base businesses 77+3% 115 +3% 1998 & 1999 acquisitions134+4% 198 +4% Disposals(46)-1% (68) -1% Currency translation effect34- 159 +3% 1999 Turnover3,390+6%5,153 +9%

41. Dividends InterimFinal 1999 1998% change 19991998% change Reed Int (p)4.604.60 0%5.4010.40-48% UK tax credit rate 10%20%10%10% Reed Int (gross) (p)5.115.75 -11%6.0011.56-48% Equalisation ratio1.5381.538 1.5381.538 Exchange rate (:£)1.501.501.621.47 Elsevier ()0.120.13 -8%0.150.26 -42%

42. Reported Profit Attributable 19991998 £m Adjusted profit attributable527571801 850 Amortisation of goodwill and intangible assets(373)(332) (567) (494) Exceptional items(217)533(329) 793 Reported profit attributable(63)772(95) 1,149 Reed International EPS(3.4)p34.7p Elsevier EPS(0.07)0.81 19991998 m m

43. Sales by Market and Type - Continuing Businesses Sales by Market Sales by Type

44. Currency Profile Adjusted Profit Before Tax Exchange rate to £1: 19991998 US Dollar1.621.66 Dutch guilder3.353.28 Euro 1.521.49 Swiss franc2.432.40

45. Free Cash Flow 1999199819991998 £m £m m m Adjusted operating cash flow7808081,1861,203 Interest (81)(45)(123)(67) Tax(173)(144)(262)(214) Dividends(339)(362)(515)(540) Other(1)(11)(2)(16) Free cash inflow 186246284366

46. www.reedelsevier.com