1. I N T E R I M R E S U L T S 2 0 0 3

2. Highlights Good performance in challenging markets Good performance in challenging markets Continuing strong progress against strategic priorities Continuing strong progress against strategic priorities Acceleration of growth in second half Acceleration of growth in second half On track to deliver 2003 targets On track to deliver 2003 targets

3. Financial Update Mark Armour Chief Financial Officer

4. Adjusted figures exclude amortisation of goodwill and intangible assets and exceptional items Turnover Adjusted operating profit Operating margin Net interest expense Adjusted profit before tax % % % % change constant 2002 m 2003 m 2002 £m 2003 £m 2,467 813505 20.5%20.5% (172)(107) 641398 6 months to 30 June 3,9722,345 496 21.2% (88) 408 3,424 724 21.2% (128) 596 0 0 +3 Adjusted Profit And Loss Reported results reflect currency translation effects Reported results reflect currency translation effects

5. Revenues Operating profit 20022003200220032002200320022003 Science & Medical Revenues up 6% - operating profit up 5% - margin 33.9% Underlying revenues up 4%; operating profit up 5% Underlying revenues up 4%; operating profit up 5% Strong subscription renewals and growing online sales Strong subscription renewals and growing online sales Science & Technology revenues up 4% Science & Technology revenues up 4% Health Sciences revenues up 3% Health Sciences revenues up 3% Book publishing programme to accelerate second half Book publishing programme to accelerate second half £mm£mm

6. Legal Revenues up 4% - operating profit up 17% - margin 20.7% Underlying revenues up 2%; operating profit up 13% Underlying revenues up 2%; operating profit up 13% Strong operating margin improvement in first half Strong operating margin improvement in first half US Legal revenues up 3%; Online up 7% - strong small law US Legal revenues up 3%; Online up 7% - strong small law US Corporate & Federal Markets flat; strong risk solutions US Corporate & Federal Markets flat; strong risk solutions International underlying revenues up 3%; accelerating demand for online International underlying revenues up 3%; accelerating demand for online20022003200220032002200320022003£m£mmm Revenues Operating profit

7. Education Revenues down 5% - operating profit down 32% - margin 7.5% Underlying revenues down 6%; operating profit down 35% Underlying revenues down 6%; operating profit down 35% First half growth unrepresentative; revenues and profit second half weighted First half growth unrepresentative; revenues and profit second half weighted US K-12 revenues flat; orders deferred to second half US K-12 revenues flat; orders deferred to second half Testing revenues down 27%; loss of California contract Testing revenues down 27%; loss of California contract International revenues up 1%; UK funding shortfalls International revenues up 1%; UK funding shortfalls20022003200220032002200320022003£m£mmm Revenues Operating profit

8. Business Revenues down 6% - operating profit down 12% - margin 17.2% Underlying revenues down 6%; operating profit 12% Underlying revenues down 6%; operating profit 12% Rate of decline in advertising markets slowed; few signs of recovery Rate of decline in advertising markets slowed; few signs of recovery Margins defended through continued cost actions Margins defended through continued cost actions Investment in product quality and disciplined yield management Investment in product quality and disciplined yield management Exhibitions resilient: revenues down 3% excluding cycling Exhibitions resilient: revenues down 3% excluding cycling20022003200220032002200320022003£m£mmm Revenues Operating profit

9. Adjusted Profit Before Tax: Reconciliation -7%596+3%408 2003 Adjusted profit before tax -10% (64) -(3) Currency translation effect +1%7+1% 5 Acquisitions/Disposals +2%12+2%8 Base business 641398 2002 Adjusted profit before tax %changem%change£m 6 months to 30 June Adjusted figures exclude amortisation of goodwill and intangibles and exceptional items

10. Cash Flow Total cash outflow before financing Free cash flow after dividends Other exceptional items Disposals Acquisition spend % conversion 2002 m2003 m2002£m2003£m 6 months to 30 June Adjusted operating cash flow 17736%(5) (209) (209) (214) (214)(97)89(41)(263)16032% (36) (36) (190) (190)(226)(90)113(37)(240)25836% (8) (8) (305) (305)(313)(141)130(59)(383)25832% (58) (58) (306) (306)(364)(145)182(59)(386) Dividends Free cash flow before dividends

11. Reported Profit Attributable 0.100.100.09 Reed Elsevier NV EPS 3.9p3.9p Reed Elsevier PLC EPS 1561429797 Reported profit attributable 117367325 Exceptional items (433)(332)(269)(228) Amortisation of goodwill and intangible assets 472438293300 Adjusted profit attributable 2002 m2003 m2002£m2003£m 6 months to 30 June

12. Adjusted Earnings and Dividends -11%0.08+3% 3.3p Equalised dividends +3%-7%0.28+2%12.6p Adjusted EPS % change constant ReedElsevierNVReed Elsevier ElsevierPLC

13. Strategy & Execution Crispin Davis Chief Executive Officer

14. Reed Elsevier: Key Objectives For 2003 Maximise above market organic growth from four core businesses Maximise above market organic growth from four core businesses Execute and deliver on all strategic milestones Execute and deliver on all strategic milestones Improve operating margin further through increased efficiency Improve operating margin further through increased efficiency Deliver double digit earnings growth Deliver double digit earnings growth ON TRACK

15. Science & Medical: ScienceDirect: Increasing Usage Article downloads (millions) Article downloads (millions)161999 282000 502001 862002 2003*124 * 12 months to 30 June

16. Science & Medical: ScienceDirect: Expanding Content Full text articles (millions) Full text articles (millions)1.22000 1.82001 3.32002 2003*4.5 * At 30 June

17. Science & Technology: Science & Technology: Continued Low Attrition * Full Year Estimate 5.2% 4.0%4.0% 8.5% 2003* 2003* 2001 2001 2000 20001999 2002 20024.0%

18. Science & Medical: Health Sciences Successful front list publishing programme Successful front list publishing programme Accelerating electronic information business Accelerating electronic information business –MD Consult 13% ahead –Wide ranging introduction of new products –Significant online education training opportunities Accelerating international expansion Accelerating international expansion –Local versioning of authoritative content –Acquisition of Holtzbrinck STM in Germany Integration of book production and distribution on track Integration of book production and distribution on track

19. Science & Medical: 2003 Outlook Revenue growth to accelerate Revenue growth to accelerate –Strong 2003 book publishing programme –Continued growth in electronic sales Cost efficiencies and operational gearing to drive further margin improvement Cost efficiencies and operational gearing to drive further margin improvement Expansion of content and innovative electronic services Expansion of content and innovative electronic services

20. Legal: US Legal Online Usage Growing Growth in commercial searches Growth in commercial searches+22% +17% +31% Online revenues up 7% 1999200220012000 2003* 2003*+20% * To 30 June

21. Legal: Risk Solutions: Long Term Growth Enterprise/Lib. Total LN Risk Mgmt. Legal/Tax Law Firms CFM Growth in public records

22. Legal: Optimising Cost Efficiency Operating margin Operating margin24.9%1999 20.1%2001 19.7%2000 2003* 2003* c.22.5% *Full Year Estimate 200221.3%

23. Legal: 2003 Outlook Maintain above market revenue momentum in US markets Maintain above market revenue momentum in US markets Acceleration of growth from new product initiatives and acquired businesses Acceleration of growth from new product initiatives and acquired businesses Margin improvement from focused cost actions, releasing funds for investment Margin improvement from focused cost actions, releasing funds for investment International – strong growth in online sales mitigated by print migration and weak corporate markets International – strong growth in online sales mitigated by print migration and weak corporate markets

24. Education: US Schools Market Attractive long term growth market Attractive long term growth market Strong federal and state commitment Strong federal and state commitment Short term market weakness in 2003/2004 Short term market weakness in 2003/2004 –Low point in adoption cycle –State budget pressures 2003 impact from federal funding modest 2003 impact from federal funding modest

25. Education: Winning Performance in 2003 Adoption Revenues # 1 Science # 4 # 1 Social Studies # 3 # 1 Mathematics Language Arts # 1 # 3 Reading/Literature SecondaryElementary Overall # 1 Overall # 1 = Based on estimated share of total available adoption revenues

26. Education: Harcourt Assessment 2003 revenues impacted by loss of California 2003 revenues impacted by loss of California Momentum regenerated: management, product, scoring, operations Momentum regenerated: management, product, scoring, operations New edition of Stanford Achievement Test launched New edition of Stanford Achievement Test launched Awarded 7 out of 11 state contracts tendered Awarded 7 out of 11 state contracts tendered Strong pipeline of state level bids Strong pipeline of state level bids

27. Education: 2003 Outlook US schools market broadly flat; small decline possible US schools market broadly flat; small decline possible Success in state adoptions will come through as second half sales Success in state adoptions will come through as second half sales Continued success in state Testing contracts Continued success in state Testing contracts Margin improvement through continuing process efficiency Margin improvement through continuing process efficiency

28. Business: Trading environment No marked deterioration; no real sign of recovery No marked deterioration; no real sign of recovery Overall Variability by sector: Growth in Entertainment; Manufacturing and Electronics still weak; Construction late cycle Variability by sector: Growth in Entertainment; Manufacturing and Electronics still weak; Construction late cycle US Economic conditions weaker; resilient subscription revenues mitigated advertising declines across all sectors Economic conditions weaker; resilient subscription revenues mitigated advertising declines across all sectors Continental Europe UK Variability by sector; Aerospace, Social Services and Property holding up Variability by sector; Aerospace, Social Services and Property holding up Impact of economic weakness, SARS and Iraq; cycling out of non-annual shows Impact of economic weakness, SARS and Iraq; cycling out of non-annual shows Global Exhibitions

29. Business: Online Revenue Growth $57m $95m $115m $22m20022001200019992003*$140m * Full year estimate

30. Business: Market Outperformance Continuing to build market share on magazines Further improvement in yield management Tight control of costs Exhibitions challenging, but showing resilience

31. Business: 2003 Outlook Continued tough trading conditions across markets Product quality, sales effectiveness and yield management restrict revenue decline Continued margin improvement, mitigating impact on profitability Significant upside as economy recovers

32. State annotated codes State annotated codes e-Filing, e- Access, e- Discovery e-Filing, e- Access, e- Discovery Integrated Risk Solutions capability Integrated Risk Solutions capability Industry Dossier Industry Dossier Global Legal Platform Global Legal Platform Reference works online Reference works online Scirus search engine Scirus search engine MD Consult upgrade MD Consult upgrade EVOLVE medical education platform EVOLVE medical education platform ScienceDirect multimedia capability ScienceDirect multimedia capability Market leading adoption programmes Market leading adoption programmes Online HRW Basal Online HRW Basal Stanford 10 Stanford 10 Texas STARgate Texas STARgate Alzheimer Quicktest Alzheimer Quicktest Totaljobs.com Totaljobs.com KellySearch KellySearch 14 magazines relaunched 14 magazines relaunched RCD Connect RCD Connect 16 new exhibitions launched 16 new exhibitions launched Product Upgrade Initiatives:

33. Elsevier Dedicated Engineering/ Dedicated Engineering/ Life Sciences/Chemistry sales forces Reed Business Customer research programme for all magazines LexisNexis LexisNexis Strengthened small law programme All Divisions Execution of sales audit programmes ElsevierCoordinated global price increase programme Elsevier/LexisNexis Elsevier/LexisNexis Implementation of global branding programme Harcourt Major upgrade of Major upgrade of Open Territories sales force Harcourt Global Library marketing programme Reed Business Reed Business RCD national accounts programme Reed Business Successful yield management programme LexisNexis Key account relationship programme Elsevier Introduction of Health Sciences telesales Sales and Marketing Initiatives:

34. Infrastructure and Cost Initiatives: New content management systems New content management systems New customer fulfilment systems New customer fulfilment systems New editorial systems New editorial systems Off-shore printing/outsourcing Off-shore printing/outsourcing Pre-plate restructuring Pre-plate restructuring Electronic author workbench Electronic author workbench New CRM systems New CRM systems 2000-2002: $500m of savings achieved 2000-2002: $500m of savings achieved 2003: $150m further savings 2003: $150m further savings

35. Risk Management Risk Management e-Discovery, e- Filing, e-Access e-Discovery, e- Filing, e-Access Endeavor Library Services Endeavor Library Services International Healthcare International Healthcare e-Healthcare e-Healthcare Clinical Testing Clinical Testing Customised State Testing Customised State Testing On-line recruitment, directories On-line recruitment, directories Variety franchise Variety franchise Shooting Stars All businesses outperforming in dynamic growth sectors All businesses outperforming in dynamic growth sectors Annual revenue growth at high single/double digit Annual revenue growth at high single/double digit Total revenue c.$700m Total revenue c.$700m

36. Reed Elsevier: Key Objectives For 2003 Unchanged Maximise above market organic growth from four core businesses Maximise above market organic growth from four core businesses Execute and deliver on all strategic milestones Execute and deliver on all strategic milestones Improve operating margin further through increased efficiency Improve operating margin further through increased efficiency Deliver double digit earnings growth Deliver double digit earnings growth ON TRACK

37. I N T E R I M R E S U L T S 2 0 0 3

38. Appendices

39. Turnover: Reconciliation %change m%change£m -14%3,424-5%2,345 2003 Turnover -14%(541)-5%(117) Currency translation effect -(19)-(13)Disposals +1%54+1%37Acquisitions -1%(42)-1%(29) Base businesses 3,9722,467 2002 Turnover 6 months to 30 June

40. First half average rates: 20032002 $:£1.611.44 $: 1.100.90 :£ 1.46 1.61 Full year average rates: 2003* 2002 2003* 2002 $:£1.62 1.50 $: 1.13 0.94 :£ 1.43 1.59 Currency Profile: Adjusted Profit Before Tax LTM to 30 June 2003 Euro41% Sterling21% US Dollar 33% Other5% *2003 average rates (approx) if recent spot rates continue ($1.62:£1; $1.15:1; 1.41:£1)

41. 2003200220032002 £m£m m m Adjusted operating cash flow177 160258258 Interest (85)(108)(124)(174) Tax(97)(88)(142)(142) Dividends(209)(190)(305)(306) Free cash outflow(214)(226) (313)(364) 6 months to 30 June Free Cash Flow

42. Cash Flow Seasonality Cash flow conversion % 90%36% 136% 1,027177 850 £m£m£m£m 12 months to 30 June £m £m 2003 2002 2003 90%36% 136% 1,499258 1,241 m 12 months to 30 June m m 2003 2002 2003 H1 H2 Adjusted operating cash flow

43. Exceptional Items 153(12)95(9) Net tax (charge)/credit (36)48(22)34 Exceptional credit/(charge) before tax 1482957 Net profit on sale of fixed asset investments and businesses (50)(34)(31)(23) Charged to operating profit (36)(22)(22)(15) Acquisition related costs (14)(12)(9)(8) Reorganisation costs 2002 m2003 m2002£m2003£m 6 months to 30 June 117367325 Total exceptional credit

44. Balance Sheet 1,0301,000669694 Net debt 5,0764,2093,2962,923 Other net liabilities/minorities 4,4033,7672,8592,616 Shareholders funds 10,5098,9766,8246,233 248206161143Investments 764704496489 Tangible fixed assets 9,5637,9796,2105,541 Goodwill/intangible assets 2002 m2003 m2002£m2003£m (66)87(43)60 Working capital 10,5098,9766,8246,233 At 30 June

45. Dividend Equalisation Reed Elsevier PLC (p) 2003 2002 % Change Interim 3.33.2 UK tax credit rate Gross (p) Equalisation ratio Exchange rate (:£) Reed Elsevier NV () 10%10% 3.673.56 1.538 1.41 0.08 1.538 1.59 0.09-11% +3%

47. I N T E R I M R E S U L T S 2 0 0 3