Final Results - Part 2

Reed International PLC
22 February 2001

PART 2

COMBINED PROFIT AND LOSS  ACCOUNT

FOR THE YEAR ENDED 31 DECEMBER 2000
                                                       2000   1999   2000   1999
                                              Note      £m     £m Euro m  Euro m
Turnover

Including share of turnover of joint ventures        3,836  3,464  6,291  5,265
Less: share of turnover of joint ventures              (68)   (74)  (111)  (112)
                                                3    3,768  3,390  6,180  5,153
   Continuing operations before acquisitions         3,589  3,390  5,886  5,153
   Acquisitions                                        179      -    294      -
Cost of sales                                       (1,332)        (2,185)
(1,801)
                                                           (1,185)
Gross profit                                         2,436  2,205  3,995  3,352
Operating expenses                                         (2,028) (3,672)
(3,083)
                                                    (2,239)
   Before amortisation and exceptional items        (1,659)(1,420) (2,721)
(2,159)
   Amortisation of goodwill and intangible            (465)  (369)  (762)  (561)
assets
   Exceptional items                            4     (115)  (239)  (189)  (363)
Operating profit (before joint ventures)               197    177    323    269
   Continuing operations before acquisitions           282    177    462    269
   Acquisitions                                        (85)     -   (139)     -
Share of operating profit of joint ventures             13      3     21      5
Operating profit including joint ventures              210    180    344    274
Non operating exceptional items                 4
Net profit on sale of fixed asset investments           85      7    140     11
and businesses
Profit on ordinary activities before interest          295    187    484    285
Net interest expense                                  (103)   (82)  (169)  (125)
Profit on ordinary activities before taxation          192    105    315    160
Tax on profit on ordinary activities                  (159)  (167)  (261)  (254)
Profit/(loss) on ordinary activities after              33    (62)    54    (94)
taxation
Minority interests                                       -     (1)     -     (1)
Profit/(loss) attributable to parent                    33    (63)    54    (95)
companies' shareholders
Equity dividends paid and proposed                    (245)  (234)  (402)  (356)
Retained loss taken to combined reserves              (212)  (297)  (348)  (451)

ADJUSTED FIGURES                                      2000   1999   2000   1999

                                              Note     £m     £m  Euro m Euro m
Adjusted operating profit                       5      793    792  1,301  1,204

Adjusted profit before tax                      5      690    710  1,132  1,079
Adjusted profit attributable to parent          5      511    527    838    801
companies' shareholders

Adjusted figures, which exclude the amortisation of goodwill and intangible
assets, exceptional items and related tax effects, and are presented as
additional performance measures.

Combined cash flow statement

FOR THE YEAR ENDED 31 DECEMBER 2000
                                                         2000  1999  2000  1999
                                                   Note   £m    £m Euro m Euro m
Net cash inflow from operating activities before      6   907   898 1,487 1,365
exceptional items
Payments relating to exceptional items charged to     6   (94) (138) (154) (210)
operating profit
Net cash inflow from operating activities                 813   760 1,333 1,155

Dividends received from joint ventures                      6     4    10     6

Interest received                                          20    33    33    50
Interest paid                                            (124) (114) (204) (173)
Returns on investments and servicing of finance          (104)  (81) (171) (123)



Taxation (including £31m/Euro51m (1999 £74m/Euro         (110)  (99) (180) (150)
112m) exceptional inflow)


Purchase of tangible fixed assets                        (141) (137) (231) (208)
Proceeds from sale of tangible fixed assets                 3    15     5    23
Capital expenditure                                      (138) (122) (226) (185)



Acquisitions                                             (914) (167)(1,499)(254)
Exceptional net proceeds from sale of fixed asset
investments and businesses                                153     3    251    5
Acquisitions and disposals                               (761) (164)(1,248)(249)

Equity dividends paid to the shareholders of the         (196) (339)  (321)(515)
parent companies



Cash outflow before changes in short term                (490)  (41)  (803) (61)
investments and financing
(Increase)/decrease in short term investments          (1,137)  297 (1,865) 451
Financing                                               1,634  (197) 2,679 (300)
Increase in cash                                            7    59     11   90

Short term investments include deposits of under one year if the maturity or
notice period exceeds 24 hours, commercial paper investments and interest
bearing securities that can be realised without significant loss at short
notice.

ADJUSTED FIGURES
                                                   2000     1999   2000   1999
                                          Note      £m       £m  Euro m  Euro m
Adjusted operating cash flow                 5      775      780  1,271  1,186

Adjusted operating cash flow conversion             98%      98%    98%    98%

Reed Elsevier businesses focus on adjusted operating cash flow as the key cash
flow measure. Adjusted operating cash flow is measured after dividends from
joint ventures, tangible fixed asset spend and proceeds from the sale of fixed
assets but before exceptional payments and proceeds. Adjusted operating cash
flow conversion expresses adjusted operating cash flow as a percentage of
adjusted operating profit.

COMBINED BALANCE SHEET

AS AT 31 DECEMBER 2000
                                                   2000    1999    2000    1999
                                                    £m      £m   Euro m   Euro m
Fixed assets

Goodwill and intangible assets                    4,127   3,400   6,644   5,474
Tangible assets                                     416     386     670     622
Investments                                         153     119     247     192
                                                  4,696   3,905   7,561   6,288
Current assets

Stocks                                              114     113     184     183
Debtors - amounts falling due within one year       860     666   1,385   1,072
Debtors - amounts falling due after more than       164     148     264     238
one year
Cash and short term investments                   1,594     440   2,566     708
                                                  2,732   1,367   4,399   2,201
Creditors: amounts falling due within one year   (3,379) (2,676) (5,441) (4,308)

Net current liabilities                            (647) (1,309) (1,042) (2,107)



Total assets less current liabilities             4,049   2,596   6,519   4,181

Creditors: amounts falling due after more than     (873)   (620) (1,406)   (998)
one year
Provisions for liabilities and charges             (128)   (113)   (206)   (182)
Minority interests                                   (7)     (8)    (11)    (14)
Net assets                                        3,041   1,855   4,896   2,987


Capital and reserves

Combined share capitals                             185     168     298     270
Combined share premium accounts                   1,621     341   2,610     549
Combined reserves                                 1,235   1,346   1,988   2,168
Combined shareholders' funds                      3,041   1,855   4,896   2,987

Net borrowings                                      433   1,066     697   1,717

Approved by the Boards of Reed International P.L.C. and Elsevier NV, 21
February 2001

Combined statement of total recognised gains and losses

FOR THE YEAR ENDED 31 DECEMBER 2000
                                                         2000  1999  2000  1999
                                                           £m   £m Euro m Euro m
Profit/(loss) attributable to parent companies'            33  (63)    54   (95)
shareholders
Exchange translation differences                          113   17    150   405
Total recognised gains and losses for the year            146  (46)   204   310


Combined shareholders' funds reconciliation

FOR THE YEAR ENDED 31 DECEMBER 2000
                                                         2000 1999 2000 1999
                                                           £m   £m Euro m Euro m
                                                                      
Profit/(loss) attributable to parent companies'             33   (63)   54  (95)
shareholders
Equity dividends paid and proposed                        (245) (234) (402)(356)
Issue of ordinary shares, net of expenses and less       1,285     5 2,107    8
capital redemptions
Exchange translation differences                           113    17   150  405
Net increase/(decrease) in combined shareholders' funds  1,186  (275)1,909  (38)
Combined shareholders' funds at 1 January                1,855 2,130 2,987 3,025
Combined shareholders' funds at 31 December              3,041 1,855 4,896 2,987


COMBINED FINANCIAL STATEMENTS

NOTES TO THE COMBINED FINANCIAL STATEMENTS

1   Basis of preparation

The Reed Elsevier combined financial statements encompass the businesses of
Reed Elsevier plc and Elsevier Reed Finance BV and their respective
subsidiaries, joint ventures and associates, together with the parent
companies, Reed International and Elsevier. Financial information is presented
in both sterling and euros.

2   Exchange rates

                                             Profit & loss       Balance sheet
                                               2000        1999    2000    1999
Euros to sterling                              1.64        1.52    1.61    1.61
US dollars to sterling                         1.51        1.62    1.49    1.62
Euros to US dollars                            1.09        0.94    1.08    0.99

3   Segment analysis
              Turnover   Adjusted operating   Turnover    Adjusted operating
                               profit                           profit
              2000  1999      2000      1999  2000  1999       2000       1999
                £m    £m        £m        £m Eurom Eurom      Eurom      Eurom
Geographical
origin
North        2,098 1,836       335       359 3,441 2,791        549        547
America
United         734   698       191       191 1,204 1,061        313        290
Kingdom
The            399   391       136       135   654   594        223        205
Netherlands
Rest of        356   307       102        87   584   467        167        132
Europe
Rest of        181   158        29        20   297   240         49         30
World
Total        3,768 3,390       793       792 6,180 5,153      1,301      1,204



              2000  1999                      2000  1999
                £m    £m                     Eurom Eurom
Geographical
market
North        2,152 1,906                     3,529 2,898
America
United         521   484                       855   736
Kingdom
The            234   237                       384   360
Netherlands
Rest of        478   418                       784   635
Europe
Rest of        383   345                       628   524
World
Total        3,768 3,390                     6,180 5,153






4   Exceptional items
                                                        2000  1999  2000  1999
                                                          £m    £m Eurom Eurom
Reorganisation costs                                    (77) (161) (126) (244)
Acquisition related costs                               (38)  (28)  (63)  (43)
Year 2000 compliance costs                                 -  (50)     -  (76)
Charged to operating profit                            (115) (239) (189) (363)
Net profit on sale of fixed asset investments and         85     7   140    11
businesses
Total exceptional charge                                (30) (232)  (49) (352)

Net tax credit                                            20    15    33    23




5   Adjusted figures

Adjusted profit and cash flow figures are used by the Reed Elsevier businesses
as additional performance measures. These exclude the amortisation of goodwill
and intangible assets, exceptional items and related tax effects, and are
derived as follows:
                                                         2000  1999  2000  1999
                                                          £m    £m Euro m Euro m
Operating profit including joint ventures                 210   180   344   274
Adjustments:
Amortisation of goodwill and intangible assets            468   373   768   567
Exceptional items                                         115   239   189   363
Adjusted operating profit                                 793   792 1,301 1,204



Profit before tax                                         192   105   315   160
Adjustments:
Amortisation of goodwill and intangible assets            468   373   768   567
Exceptional items                                          30   232    49   352
Adjusted profit before tax                                690   710 1,132 1,079



Profit/(loss) attributable to parent companies'            33   (63)   54   (95)
shareholders
Adjustments:
Amortisation of goodwill and intangible assets            468   373   768   567
Exceptional items                                          10   217    16   329
Adjusted profit attributable to parent companies'         511   527   838   801
shareholders


Net cash inflow from operating activities                 813   760 1,333 1,155
Dividends received from joint ventures                      6     4    10     6
Purchase of tangible fixed assets                        (141) (137) (231) (208)
Proceeds from sale of fixed assets                          3    15     5    23
Payments in relation to exceptional items charged to       94   138   154   210
operating profit
Adjusted operating cash flow                              775   780 1,271 1,186


6.   Reconciliation of net cash inflow from operating activities
                                               2000  1999       2000       1999
                                                 £m    £m      Euro m     Euro m
Operating profit (before joint ventures)        197   177        323        269
Exceptional charges to operating profit         115   239        189        363
Operating profit before exceptional items       312   416        512        632



Amortisation of goodwill and intangible assets            465   369   762   561
Depreciation                                              118   117   194   178
Net SSAP24 pension credit                                  (1)   (3)   (2)   (5)
Total non cash items                                      582   483   954   734



Increase in stocks                                         (3)   (9)   (5)  (14)
Increase in debtors                                      (110)   (8) (181)  (12)
Increase in creditors                                     126    16   207    25
Movement in working capital                                13    (1)   21    (1)



Net cash inflow from operating activities before          907   898 1,487 1,365
exceptional items
Payments relating to exceptional items charged to         (94) (138) (154) (210)
operating profit
Net cash inflow from operating activities                 813   760 1,333 1,155

7   Reconciliation of net borrowings

                                                  2000    1999    2000    1999
                                                    £m      £m   Euro m   Euro m
Net borrowings at 1 January                     (1,066)   (962) (1,717) (1,366)


Increase in cash                                     7      59      11      90
Increase/(decrease) in short term investments    1,137    (297)  1,865    (451)
(Increase)/decrease in borrowings                 (347)    202    (569)    308
Change in net borrowings resulting from cash       797     (36)  1,307     (53)
flows
Loans in acquired business                         (48)       -    (79)       -
Inception of finance leases                         (3)    (11)     (5)    (17)
Exchange translation differences                  (113)    (57)   (203)   (281)
Net borrowings at 31 December                     (433) (1,066)   (697) (1,717)


REED INTERNATIONAL P.L.C.

SUMMARY FINANCIAL INFORMATION

Basis of preparation

The results for the year ended 31 December 2000 reflect the 52.9% economic
interest of Reed International's shareholders in the Reed Elsevier combined
businesses, after taking account of results arising in Reed International and
its subsidiary undertakings. These interests have been accounted for on an
equity basis.  Adjusted figures, which exclude the amortisation of goodwill
and intangible assets, exceptional items and related tax effects, are
presented as additional performance measures.

Summary consolidated profit and loss account


FOR THE YEAR ENDED 31 DECEMBER 2000                              2000     1999
                                                                   £m       £m
Share in combined turnover                                      1,994    1,793
Share of combined adjusted profit before tax                      365      376
Share of amortisation                                            (248)    (197)
Share of exceptional items before tax                             (15)    (122)
Elsevier's share of UK tax credit on distributed earnings          (6)      (6)
Profit on ordinary activities before taxation                      96       51
Tax on profit on ordinary activities                              (85)     (90)
Profit/(loss) attributable to ordinary shareholders                11      (39)
Equity dividends paid and proposed                               (123)    (116)
Retained loss taken to reserves                                  (112)    (155)
Basic earnings/(loss) per share                                  1.0p    (3.4)p
Diluted earnings/(loss) per share                                1.0p    (3.4)p
Adjusted earnings per share                                     23.3p    24.4p

Adjusted earnings per share is based upon the Reed International's
shareholders' 52.9% share of the adjusted profit attributable of the Reed
Elsevier combined businesses. Tax on profit on ordinary activities includes £
83m (1999 £95m) in respect of joint ventures.

Dividends

The directors of Reed International have proposed a final dividend of 6.9p per
ordinary share (1999 5.4p) which when added to the interim dividend already
paid of 3.1p per ordinary share (1999 4.6p), amounts to a total 2000 dividend
of 10.0p per ordinary share (1999 10.0p). The Reed International final
dividend will be paid on 14 May 2001, with an ex-dividend and record date of
18 April and 20 April 2001, respectively  Dividends paid to Reed International
and Elsevier shareholders are equalised at the gross level inclusive of the UK
tax credit received by certain Reed International shareholders. The
equalisation adjustment equalises the benefit of the tax credit between the
two sets of shareholders in accordance with the equalisation agreement.

Summary consolidated cashflow statement

                                                                    2000   1999
FOR THE YEAR ENDED 31 DECEMBER 2000                                   £m     £m
Net cash outflow from operating activities                            (1)    (2)
Dividends received from Reed Elsevier plc                             97    172
Equity dividends paid                                                (98)  (173)
(Increase)/decrease in short term investments                       (431)     2
Financing (including issue of ordinary shares £709m (1999 £nil))     430     (9)
Other cash flows                                                       3     10
Change in net cash                                                     -      -

Summary consolidated balance sheet
                                                                    2000   1999
AS AT 31 DECEMBER 2000                                                £m     £m
Fixed asset investment in joint ventures                             801    857
Net current assets                                                   844    160
Creditors: amounts falling due after more than one year              (36)   (36)
Net assets                                                         1,609    981

Net current assets includes short term investments of £431m (1999 £nil) and
amounts owed by Reed Elsevier plc group of £512m (1999 £233m).

On 5 December 2000, the company issued 113,700,000 new 12.5 pence ordinary
shares at 625 pence each following a joint international offering by Reed
International and Elsevier.  The purpose of the offering was to finance the
proposed acquisition by Reed Elsevier of the Scientific, Technical and Medical
business and the Schools Education and Testing business of Harcourt General,
Inc.  The aggregate nominal value of the shares issued was £14.2m and the
total net proceeds were £694m.

The financial information set out above has been abridged from the financial
statements for the year ended 31 December 2000, which have been audited by
Deloitte & Touche, and will be filed with the UK Registrar of Companies
following the Annual General Meeting.  The audit report was unqualified and
did not contain statements under S237(2) or (3) Companies Act 1985.


ELSEVIER NV

SUMMARY FINANCIAL INFORMATION

Basis of preparation

The results for the year ended 31 December 2000 reflect the 50% economic
interest of Elsevier's shareholders in the Reed Elsevier combined businesses,
which is accounted for on an equity basis.  Adjusted figures, which exclude
the amortisation of goodwill and intangible assets, exceptional items and
related tax effects, are presented as additional performance measures.

Summary profit and loss account

FOR THE YEAR ENDED 31 DECEMBER 2000                              2000      1999
                                                                Euro m   Euro m
Share of combined turnover                                      3,091     2,577

Share of combined adjusted profit before tax                      566       540
Share of amortisation                                            (384)     (284)
Share of exceptional items before tax                             (25)     (176)
Taxation                                                         (130)     (128)
Profit/(loss) attributable to shareholders                         27       (48)
Allocation of profit/(loss)
Equity dividends paid and proposed                                200       179
Transfer from reserves                                           (173)     (227)
Profit/(loss) attributable to shareholders                         27       (48)
Adjusted earnings per share (in euros)                           0.59      0.57

Adjusted earnings per share is based upon the Elsevier shareholders' 50% share
of the adjusted profit attributable of the Reed Elsevier combined businesses.

Dividends

The directors of Elsevier have proposed a final dividend of Euro0.19 per
ordinary share (1999 Euro0.15), which when added to the interim dividend
already paid of Euro0.09 per ordinary share (1999 Euro0.12), amounts to a
total 2000 dividend of Euro0.28 per ordinary share (1999 Euro0.27), an
increase of 4%.  The Elsevier final dividend will be paid on 14 May 2001, with
an ex-dividend date of 18 April 2001.  Dividends paid to Reed International
and Elsevier shareholders are equalised at the gross level inclusive of the UK
tax credit received by certain Reed International shareholders.

Summary cash flow statement
                                                                    2000  1999
FOR THE YEAR ENDED 31 DECEMBER 2000                               Euro m Euro m
Net cash outflow from operating activities                            (2)   (5)
Dividends received from joint ventures                               623   254
Equity dividends paid                                               (160) (255)
Increase in short term investments                                  (952)   (2)
Investment in joint venture                                         (533)    -
Financing (including issue of ordinary shares Euro956m (1999 Euro  1,016     5
8m))
Other cash flows                                                       8     3
Change in net cash                                                     -     -

Summary balance sheet
                                                                    2000  1999
AS AT 31 DECEMBER 2000                                            Euro m Euro m
Fixed assets                                                       1,674 1,559
Net current assets/(liabilities)                                     822   (22)
Creditors: amounts falling due after more than one year               (6)   (8)
Provisions                                                           (42)  (36)
Net assets                                                         2,448 1,493

Net current assets includes short term investments of Euro971m (1999 Euro19m).

On 5 December 2000, the company issued 66,255,000 new Euro0.06 ordinary shares
at Euro14.50 each following a joint international offering by Reed
International and Elsevier.  The purpose of the offering was to finance the
proposed acquisition by Reed Elsevier of the Scientific, Technical and Medical
business and the Schools Education and Testing business of Harcourt General,
Inc.  The aggregate nominal value of the shares issued was Euro4.0m and the
total net proceeds were Euro933m.

The financial information in respect of the year ended 31 December 2000 has
been extracted from the stutory accounts of Elsevier which have been audited
by Deloitte & Touche.

ADDITIONAL INFORMATION FOR US INVESTORS

REED ELSEVIER SUMMARY COMBINED FINANCIAL INFORMATION UNDER US GAAP

SUMMARY OF PRINCIPAL differences between UK and Dutch GAAP and US GAAP

Basis of preparation

The combined financial statements for Reed Elsevier are prepared in accordance
with UK and Dutch GAAP, which differ in certain significant respects from US
GAAP. The principal differences relate to the US GAAP requirements in respect
of the capitalisation and amortisation of goodwill and other intangible assets
and deferred taxes. A more complete explanation of accounting policies used by
the combined businesses and the differences between UK and Dutch GAAP and US
GAAP will be set out in the 2000 Reed Elsevier Annual Report and Reed Elsevier
Annual Report on Form 20-F.

Net income

FOR THE YEAR ENDED 31 DECEMBER 2000                    2000  1999  2000  1999
                                                         £m    £m Euro m Euro m
Net income/(loss) under UK and Dutch GAAP                33   (63)   54   (95)
US GAAP adjustments:
   Amortisation of goodwill and other intangible        (78)  (83) (128) (126)
assets
   Deferred taxation                                     85    67   139   101
   Pensions                                              22     6    36     9
   Other items                                           (2)     -   (3)     -
Net income/ (loss) under US GAAP                         60   (73)   98  (111)


Combined shareholders' funds
As at 31 December 2000                                 2000  1999  2000  1999
                                                         £m    £m Euro m Euro m
Combined shareholders' funds under UK and Dutch GAAP  3,041 1,855 4,896 2,987
US GAAP adjustments:
   Goodwill and other intangible assets                 604   553   973   890
   Deferred taxation                                   (203) (180) (327) (290)
   Pensions                                              86    63   138   102
   Other items                                            2     5     3     8
   Ordinary dividends not declared in the period        177   127   285   204
Combined shareholders' funds under US GAAP            3,707 2,423 5,968 3,901


Both Reed International ('RUK', CUSIP No. 758212872) and Elsevier ('ENL',
CUSIP No. 290259100) have American Depositary Shares (ADSs) listed on the New
York Stock Exchange (Depositary: Citibank NA). An ADS in Elsevier represents
two ordinary shares in Elsevier, while a Reed International ADS represents
four ordinary shares in Reed International. Final dividends on Reed
International and Elsevier ADSs will be paid on 21 May 2001.

NOTES FOR EDITORS

Reed Elsevier is a world leading publisher and information provider and its
principal operations are in North America and Europe. Its two parent companies
- Reed International P.L.C. ('Reed International') and Elsevier NV ('
Elsevier') - are listed on the Amsterdam, London and New York Stock Exchanges
and the returns to their respective shareholders are equalised in terms of
dividend and capital rights. 'Reed Elsevier' and 'the combined businesses'
comprise Reed International and Elsevier plus their two jointly owned
companies, Reed Elsevier plc and Elsevier Reed Finance BV and their respective
subsidiaries and joint ventures.

The Reed Elsevier Annual Review 2000 and Reed International P.L.C. 2000 Report
and Accounts are being posted to Reed International shareholders on 10 March
2001. Copies of the Reed Elsevier Annual Review 2000 and Elsevier NV Annual
Report 2000 will be available to shareholders in Elsevier on request. Copies
of the Preliminary Statement are available to the public from the respective
companies:

Reed International P.L.C.           Elsevier NV

25 Victoria Street                  Van de Sande Bakhuyzenstraat 4

London SW1H 0EX                     1061 AG, Amsterdam

UK                                  The Netherlands

Copies of all recent announcements, including this Preliminary Statement, and
additional information

on Reed Elsevier can be found on the Reed Elsevier Home Page on the World Wide
Web:

http://www.reedelsevier.com