Issued on behalf of Reed Elsevier PLC and Reed Elsevier NV
OVERALL SUCCESSFUL YEAR; GOOD GROWTH MOMENTUM; ACTIONS TAKEN AT HARCOURT EDUCATION
Revenues up 7%, adjusted pre-tax profits up 9% and earnings per share up 11% at constant exchange rates; cash flow conversion 95%
Good performances in Elsevier, LexisNexis and Reed Business; Harcourt Education disappointing
Demand strong for scientific research and medical information in more supportive funding environment at Elsevier
Good performance at LexisNexis with strong growth from online total practice solutions, risk management and in international markets
Rapid online growth at Reed Business and exhibitions performing strongly as markets recover
Strong US basal growth at Harcourt Education offset by significant weakness in supplemental and assessment; actions taken to address performance issues
Targets reiterated for 2006: organic revenue growth of 5% and double digit growth in adjusted earnings per share at constant currencies
Focus on capital efficiency: Reed Elsevier PLC dividend up 11%, Reed Elsevier NV dividend up 9%; share repurchase programme introduced
Annual repurchase programme of $350m; c$1bn over three years
Dividends and share repurchases expected to equate to approximately 70-80% of 2006 free cashflow

Dividend per share 14.4p 13.0p +11% €0.359 €0.330 +9%

Sir Crispin Davis, Chief Executive Officer of Reed Elsevier, commented:
“Three of our four divisions are performing well and delivered on or exceeded their individual divisional targets for organic revenue growth. The Education business, however, disappointed in two significant markets and firm action is being taken to address the related product, marketing and organisational issues. Overall, revenue growth has accelerated, underlying operating margins have continued to improve, cash generation is strong, and good and growing returns achieved on invested capital.

The longer term outlook is promising. The digital environment continues to expand our opportunity and we are very focused on exploiting our content, brands, market positions and technology to drive sustainable long term growth for the benefit of our customers and shareholders alike. We will also continue to focus on increasing the returns on capital and believe that the share repurchase plan announced today will enhance shareholder returns whilst retaining financial flexibility.”